[House Report 111-299]
[From the U.S. Government Publishing Office]
111th Congress Rept. 111-299
HOUSE OF REPRESENTATIVES
1st Session Part 1
_______________________________________________________________________
AMERICA'S AFFORDABLE HEALTH CHOICES ACT OF 2009
----------
R E P O R T
of the
COMMITTEE ON ENERGY AND COMMERCE
on
H.R. 3200
together with
DISSENTING VIEWS
October 14, 2009.--Ordered to be printed
AMERICA'S AFFORDABLE HEALTH CHOICES ACT OF 2009--PART 1
For Sale by the Superintendent of Documents, U.S. Government Printing Office
Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; (202) 512�091800
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111th Congress
1st Session HOUSE OF REPRESENTATIVES Rept. 111-299
Part 1
_______________________________________________________________________
AMERICA'S AFFORDABLE HEALTH CHOICES ACT OF 2009
__________
R E P O R T
of the
COMMITTEE ON ENERGY AND COMMERCE
on
H.R. 3200
together with
DISSENTING VIEWS
October 14, 2009.--Ordered to be printed
111th Congress Rept. 111-299
HOUSE OF REPRESENTATIVES
1st Session Part 1
======================================================================
AMERICA'S AFFORDABLE HEALTH CHOICES ACT OF 2009
_______
October 14, 2009.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Waxman, from the Committee on Energy and Commerce, submitted the
following
R E P O R T
together with
DISSENTING VIEWS
[To accompany H.R. 3200]
The Committee on Energy and Commerce, to whom was referred
the bill (H.R. 3200) to provide affordable, quality health care
for all Americans and reduce the growth in health care
spending, and for other purposes, having considered the same,
report favorably thereon with an amendment and recommend that
the bill as amended do pass.
CONTENTS
Page
Amendment........................................................ 2
Purpose and Summary.............................................. 318
Background and Need for Legislation.............................. 320
Legislative History.............................................. 328
Committee Consideration.......................................... 329
Committee Votes.................................................. 329
Committee Oversight Findings and Recommendations................. 368
New Budget Authority, Entitlement Authority, and Tax Expenditures 368
Statement of General Performance Goals and Objectives............ 368
Constitutional Authority Statement............................... 368
Earmarks and Tax and Tariff Benefits............................. 368
Advisory Committee Statement..................................... 368
Applicability of Law to Legislative Branch....................... 369
Federal Mandates Statement....................................... 369
Committee Cost Estimate.......................................... 369
Congressional Budget Office Estimate............................. 369
Section-by-Section Analysis of the Legislation................... 369
Additional Committee Action Relating to H.R. 3200................ 746
Changes in Existing Law Made by the Bill, as Reported............ 748
Dissenting Views................................................. 1167
Appendix A--Text of Motion to Instruct the Chairman on H.R. 3200. 1183
Amendment
The amendment is as follows:
Strike all after the enacting clause (other than sections 321
and 322, title IV of division A, subtitle A of title I of
division B, and title VIII of division B) and insert the
following:
SECTION 1. SHORT TITLE; TABLE OF DIVISIONS, TITLES, AND SUBTITLES.
(a) Short Title.--This Act may be cited as the ``America's Affordable
Health Choices Act of 2009''.
(b) Table of Divisions, Titles, and Subtitles.--This Act is divided
into divisions, titles, and subtitles as follows:
DIVISION A--AFFORDABLE HEALTH CARE CHOICES
TITLE I--PROTECTIONS AND STANDARDS FOR QUALIFIED HEALTH BENEFITS PLANS
Subtitle A--General Standards
Subtitle B--Standards Guaranteeing Access to Affordable Coverage
Subtitle C--Standards Guaranteeing Access to Essential Benefits
Subtitle D--Additional Consumer Protections
Subtitle E--Governance
Subtitle F--Relation to Other Requirements; Miscellaneous
Subtitle G--Early Investments
TITLE II--HEALTH INSURANCE EXCHANGE AND RELATED PROVISIONS
Subtitle A--Health Insurance Exchange
Subtitle B--Public Health Insurance Option
Subtitle C--Individual Affordability Credits
Subtitle D--Health Insurance Cooperatives
TITLE III--SHARED RESPONSIBILITY
Subtitle A--Individual Responsibility
Subtitle B--Employer Responsibility
TITLE IV--AMENDMENTS TO INTERNAL REVENUE CODE OF 1986
Subtitle A--Shared Responsibility
Subtitle B--Credit for Small Business Employee Health Coverage Expenses
Subtitle C--Disclosures To Carry Out Health Insurance Exchange
Subsidies
Subtitle D--Other Revenue Provisions
DIVISION B--MEDICARE AND MEDICAID IMPROVEMENTS
TITLE I--IMPROVING HEALTH CARE VALUE
Subtitle A--Provisions Related to Medicare Part A
Subtitle B--Provisions Related to Medicare Part B
Subtitle C--Provisions Related to Medicare Parts A and B
Subtitle D--Medicare Advantage Reforms
Subtitle E--Improvements to Medicare Part D
Subtitle F--Medicare Rural Access Protections
TITLE II--MEDICARE BENEFICIARY IMPROVEMENTS
Subtitle A--Improving and Simplifying Financial Assistance for Low
Income Medicare Beneficiaries
Subtitle B--Reducing Health Disparities
Subtitle C--Miscellaneous Improvements
TITLE III--PROMOTING PRIMARY CARE, MENTAL HEALTH SERVICES, AND
COORDINATED CARE
TITLE IV--QUALITY
Subtitle A--Comparative Effectiveness Research
Subtitle B--Nursing Home Transparency
Subtitle C--Quality Measurements
Subtitle D--Physician Payments Sunshine Provision
Subtitle E--Public Reporting on Health Care-Associated Infections
TITLE V--MEDICARE GRADUATE MEDICAL EDUCATION
TITLE VI--PROGRAM INTEGRITY
Subtitle A--Increased Funding To Fight Waste, Fraud, and Abuse
Subtitle B--Enhanced Penalties for Fraud and Abuse
Subtitle C--Enhanced Program and Provider Protections
Subtitle D--Access to Information Needed To Prevent Fraud, Waste, and
Abuse
TITLE VII--MEDICAID AND CHIP
Subtitle A--Medicaid and Health Reform
Subtitle B--Prevention
Subtitle C--Access
Subtitle D--Coverage
Subtitle E--Financing
Subtitle F--Waste, Fraud, and Abuse
Subtitle G--Payments to the Territories
Subtitle H--Miscellaneous
TITLE VIII--REVENUE-RELATED PROVISIONS
TITLE IX--MISCELLANEOUS PROVISIONS
DIVISION C--PUBLIC HEALTH AND WORKFORCE DEVELOPMENT
TITLE I--COMMUNITY HEALTH CENTERS
TITLE II--WORKFORCE
Subtitle A--Primary Care Workforce
Subtitle B--Nursing Workforce
Subtitle C--Public Health Workforce
Subtitle D--Adapting Workforce to Evolving Health System Needs
TITLE III--PREVENTION AND WELLNESS
TITLE IV--QUALITY AND SURVEILLANCE
TITLE V--OTHER PROVISIONS
Subtitle A--Drug Discount for Rural and Other Hospitals
Subtitle B--Programs
Subtitle C--Food and Drug Administration
Subtitle D--Community Living Assistance Services and Supports
Subtitle E--Miscellaneous
DIVISION A--AFFORDABLE HEALTH CARE CHOICES
SEC. 100. PURPOSE; TABLE OF CONTENTS OF DIVISION; GENERAL DEFINITIONS.
(a) Purpose.--
(1) In general.--The purpose of this division is to provide
affordable, quality health care for all Americans and reduce
the growth in health care spending.
(2) Building on current system.--This division achieves this
purpose by building on what works in today's health care
system, while repairing the aspects that are broken.
(3) Insurance reforms.--This division--
(A) enacts strong insurance market reforms;
(B) creates a new Health Insurance Exchange, with a
public health insurance option alongside private plans
and cooperatives under subtitle D of title II;
(C) includes sliding scale affordability credits; and
(D) initiates shared responsibility among workers,
employers, and the government;
so that all Americans have coverage of essential health
benefits.
(4) Health delivery reform.--This division institutes health
delivery system reforms both to increase quality and to reduce
growth in health spending so that health care becomes more
affordable for businesses, families, and government.
(b) Table of Contents of Division.--The table of contents of this
division is as follows:
Sec. 100. Purpose; table of contents of division; general definitions.
TITLE I--PROTECTIONS AND STANDARDS FOR QUALIFIED HEALTH BENEFITS PLANS
Subtitle A--General Standards
Sec. 101. Requirements reforming health insurance marketplace.
Sec. 102. Protecting the choice to keep current coverage.
Subtitle B--Standards Guaranteeing Access to Affordable Coverage
Sec. 111. Prohibiting preexisting condition exclusions.
Sec. 112. Guaranteed issue and renewal for insured plans.
Sec. 113. Insurance rating rules.
Sec. 114. Nondiscrimination in benefits; parity in mental health and
substance abuse disorder benefits.
Sec. 115. Ensuring adequacy of provider networks.
Sec. 116. Ensuring value and lower premiums.
Subtitle C--Standards Guaranteeing Access to Essential Benefits
Sec. 121. Coverage of essential benefits package.
Sec. 122. Essential benefits package defined.
Sec. 123. Health Benefits Advisory Committee.
Sec. 124. Process for adoption of recommendations; adoption of benefit
standards.
Sec. 125. Prohibition of discrimination in health care services based
on religious or spiritual content.
Subtitle D--Additional Consumer Protections
Sec. 131. Requiring fair marketing practices by health insurers.
Sec. 132. Requiring fair grievance and appeals mechanisms.
Sec. 133. Requiring information transparency and plan disclosure.
Sec. 134. Application to qualified health benefits plans not offered
through the Health Insurance Exchange.
Sec. 135. Timely payment of claims.
Sec. 136. Standardized rules for coordination and subrogation of
benefits.
Sec. 137. Application of administrative simplification.
Sec. 138. Information on end-of-life planning.
Sec. 139. Utilization review activities.
Sec. 139A. Internal appeals procedures.
Sec. 139B. External appeals procedures.
Subtitle E--Governance
Sec. 141. Health Choices Administration; Health Choices Commissioner.
Sec. 142. Duties and authority of Commissioner.
Sec. 143. Consultation and coordination.
Sec. 144. Health Insurance Ombudsman.
Subtitle F--Relation to Other Requirements; Miscellaneous
Sec. 151. Relation to other requirements.
Sec. 152. Prohibiting discrimination in health care.
Sec. 153. Whistleblower protection.
Sec. 154. Construction regarding collective bargaining.
Sec. 155. Severability.
Sec. 156. Application of State and Federal laws regarding abortion.
Sec. 157. Non-discrimination on abortion and respect for rights of
conscience.
Subtitle G--Early Investments
Sec. 161. Ensuring value and lower premiums.
Sec. 162. Ending health insurance rescission abuse.
Sec. 163. Ending health insurance denials and delays of necessary
treatment for children with deformities.
Sec. 164. Administrative simplification.
Sec. 165. Expansion of electronic transactions in medicare.
Sec. 166. Reinsurance program for retirees.
Sec. 167. Limitations on preexisting condition exclusions in group
health plans and health insurance coverage in the group and individual
markets in advance of applicability of new prohibition of preexisting
condition exclusions.
TITLE II--HEALTH INSURANCE EXCHANGE AND RELATED PROVISIONS
Subtitle A--Health Insurance Exchange
Sec. 201. Establishment of Health Insurance Exchange; outline of
duties; definitions.
Sec. 202. Exchange-eligible individuals and employers.
Sec. 203. Benefits package levels.
Sec. 204. Contracts for the offering of Exchange-participating health
benefits plans.
Sec. 205. Outreach and enrollment of Exchange-eligible individuals and
employers in Exchange-participating health benefits plans.
Sec. 206. Other functions.
Sec. 207. Health Insurance Exchange Trust Fund.
Sec. 208. Optional operation of State-based health insurance exchanges.
Sec. 209. Limitation on premium increases under Exchange-participating
health benefits plans.
Subtitle B--Public Health Insurance Option
Sec. 221. Establishment and administration of a public health insurance
option as an Exchange-qualified health benefits plan.
Sec. 222. Premiums and financing.
Sec. 223. Negotiated payment rates for items and services.
Sec. 224. Modernized payment initiatives and delivery system reform.
Sec. 225. Provider participation.
Sec. 226. Application of fraud and abuse provisions.
Sec. 227. Application of HIPAA insurance requirements.
Sec. 228. Application of health information privacy, security, and
electronic transaction requirements.
Sec. 229. Enrollment in public health insurance option is voluntary.
Subtitle C--Individual Affordability Credits
Sec. 241. Availability through Health Insurance Exchange.
Sec. 242. Affordable credit eligible individual.
Sec. 243. Affordable premium credit.
Sec. 244. Affordability cost-sharing credit.
Sec. 245. Income determinations.
Sec. 246. No Federal payment for undocumented aliens.
Subtitle D--Health Insurance Cooperatives
Sec. 251. Establishment.
Sec. 252. Start-up and solvency grants and loans.
Sec. 253. Definitions.
TITLE III--SHARED RESPONSIBILITY
Subtitle A--Individual Responsibility
Sec. 301. Individual responsibility.
Subtitle B--Employer Responsibility
Part 1--Health Coverage Participation Requirements
Sec. 311. Health coverage participation requirements.
Sec. 312. Employer responsibility to contribute towards employee and
dependent coverage.
Sec. 313. Employer contributions in lieu of coverage.
Sec. 314. Authority related to improper steering.
Part 2--Satisfaction of Health Coverage Participation Requirements
Sec. 321. Satisfaction of health coverage participation requirements
under the Employee Retirement Income Security Act of 1974.
Sec. 322. Satisfaction of health coverage participation requirements
under the Internal Revenue Code of 1986.
Sec. 323. Satisfaction of health coverage participation requirements
under the Public Health Service Act.
Sec. 324. Additional rules relating to health coverage participation
requirements.
TITLE IV--AMENDMENTS TO INTERNAL REVENUE CODE OF 1986
Subtitle A--Shared Responsibility
Part 1--Individual Responsibility
Sec. 401. Tax on individuals without acceptable health care coverage.
Part 2--Employer Responsibility
Sec. 411. Election to satisfy health coverage participation
requirements.
Sec. 412. Responsibilities of nonelecting employers.
Subtitle B--Credit for Small Business Employee Health Coverage Expenses
Sec. 421. Credit for small business employee health coverage expenses.
Subtitle C--Disclosures To Carry Out Health Insurance Exchange
Subsidies
Sec. 431. Disclosures to carry out health insurance exchange subsidies.
Subtitle D--Other Revenue Provisions
Part 1--General Provisions
Sec. 441. Surcharge on high income individuals.
Sec. 442. Delay in application of worldwide allocation of interest.
Part 2--Prevention of Tax Avoidance
Sec. 451. Limitation on treaty benefits for certain deductible
payments.
Sec. 452. Codification of economic substance doctrine.
Sec. 453. Penalties for underpayments.
(c) General Definitions.--Except as otherwise provided, in this
division:
(1) Acceptable coverage.--The term ``acceptable coverage''
has the meaning given such term in section 202(d)(2).
(2) Basic plan.--The term ``basic plan'' has the meaning
given such term in section 203(c).
(3) Commissioner.--The term ``Commissioner'' means the Health
Choices Commissioner established under section 141.
(4) Cost-sharing.--The term ``cost-sharing'' includes
deductibles, coinsurance, copayments, and similar charges but
does not include premiums or any network payment differential
for covered services or spending for non-covered services.
(5) Dependent.--The term ``dependent'' has the meaning given
such term by the Commissioner and includes a spouse.
(6) Employment-based health plan.--The term ``employment-
based health plan''--
(A) means a group health plan (as defined in section
733(a)(1) of the Employee Retirement Income Security
Act of 1974); and
(B) includes such a plan that is the following:
(i) Federal, state, and tribal governmental
plans.--A governmental plan (as defined in
section 3(32) of the Employee Retirement Income
Security Act of 1974), including a health
benefits plan offered under chapter 89 of title
5, United States Code.
(ii) Church plans.--A church plan (as defined
in section 3(33) of the Employee Retirement
Income Security Act of 1974).
(7) Enhanced plan.--The term ``enhanced plan'' has the
meaning given such term in section 203(c).
(8) Essential benefits package.--The term ``essential
benefits package'' is defined in section 122(a).
(9) Family.--The term ``family'' means an individual and
includes the individual's dependents.
(10) Federal poverty level; fpl.--The terms ``Federal poverty
level'' and ``FPL'' have the meaning given the term ``poverty
line'' in section 673(2) of the Community Services Block Grant
Act (42 U.S.C. 9902(2)), including any revision required by
such section.
(11) Health benefits plan.--The terms ``health benefits
plan'' means health insurance coverage and an employment-based
health plan and includes the public health insurance option and
cooperatives under subtitle D of title II.
(12) Health insurance coverage; health insurance issuer.--The
terms ``health insurance coverage'' and ``health insurance
issuer'' have the meanings given such terms in section 2791 of
the Public Health Service Act.
(13) Health insurance exchange.--The term ``Health Insurance
Exchange'' means the Health Insurance Exchange established
under section 201.
(14) Medicaid.--The term ``Medicaid'' means a State plan
under title XIX of the Social Security Act (whether or not the
plan is operating under a waiver under section 1115 of such
Act).
(15) Medicare.--The term ``Medicare'' means the health
insurance programs under title XVIII of the Social Security
Act.
(16) Plan sponsor.--The term ``plan sponsor'' has the meaning
given such term in section 3(16)(B) of the Employee Retirement
Income Security Act of 1974.
(17) Plan year.--The term ``plan year'' means--
(A) with respect to an employment-based health plan,
a plan year as specified under such plan; or
(B) with respect to a health benefits plan other than
an employment-based health plan, a 12-month period as
specified by the Commissioner.
(18) Premium plan; premium-plus plan.--The terms ``premium
plan'' and ``premium-plus plan'' have the meanings given such
terms in section 203(c).
(19) QHBP offering entity.--The terms ``QHBP offering
entity'' means, with respect to a health benefits plan that
is--
(A) a group health plan (as defined, subject to
subsection (d), in section 733(a)(1) of the Employee
Retirement Income Security Act of 1974), the plan
sponsor in relation to such group health plan, except
that, in the case of a plan maintained jointly by 1 or
more employers and 1 or more employee organizations and
with respect to which an employer is the primary source
of financing, such term means such employer;
(B) health insurance coverage, the health insurance
issuer offering the coverage, including a cooperative
under subtitle D of title II;
(C) the public health insurance option, the Secretary
of Health and Human Services;
(D) a non-Federal governmental plan (as defined in
section 2791(d) of the Public Health Service Act), the
State or political subdivision of a State (or agency or
instrumentality of such State or subdivision) which
establishes or maintains such plan; or
(E) a Federal governmental plan (as defined in
section 2791(d) of the Public Health Service Act), the
appropriate Federal official.
(20) Qualified health benefits plan.--The term ``qualified
health benefits plan'' means a health benefits plan that meets
the requirements for such a plan under title I and includes the
public health insurance option and cooperatives under subtitle
D of title II.
(21) Public health insurance option.--The term ``public
health insurance option'' means the public health insurance
option as provided under subtitle B of title II.
(22) Service area; premium rating area.--The terms ``service
area'' and ``premium rating area'' mean with respect to health
insurance coverage--
(A) offered other than through the Health Insurance
Exchange, such an area as established by the QHBP
offering entity of such coverage in accordance with
applicable State law; and
(B) offered through the Health Insurance Exchange,
such an area as established by such entity in
accordance with applicable State law and applicable
rules of the Commissioner for Exchange-participating
health benefits plans.
(23) State.--The term ``State'' means the 50 States and the
District of Columbia.
(24) State medicaid agency.--The term ``State Medicaid
agency'' means, with respect to a Medicaid plan, the single
State agency responsible for administering such plan under
title XIX of the Social Security Act.
(25) Y1, y2, etc..--The terms ``Y1'' , ``Y2'', ``Y3'',
``Y4'', ``Y5'', and similar subsequently numbered terms, mean
2013 and subsequent years, respectively.
TITLE I--PROTECTIONS AND STANDARDS FOR QUALIFIED HEALTH BENEFITS PLANS
Subtitle A--General Standards
SEC. 101. REQUIREMENTS REFORMING HEALTH INSURANCE MARKETPLACE.
(a) Purpose.--The purpose of this title is to establish standards to
ensure that new health insurance coverage and employment-based health
plans that are offered meet standards guaranteeing access to affordable
coverage, essential benefits, and other consumer protections.
(b) Requirements for Qualified Health Benefits Plans.--On or after
the first day of Y1, a health benefits plan shall not be a qualified
health benefits plan under this division unless the plan meets the
applicable requirements of the following subtitles for the type of plan
and plan year involved:
(1) Subtitle B (relating to affordable coverage).
(2) Subtitle C (relating to essential benefits).
(3) Subtitle D (relating to consumer protection).
(c) Terminology.--In this division:
(1) Enrollment in employment-based health plans.--An
individual shall be treated as being ``enrolled'' in an
employment-based health plan if the individual is a participant
or beneficiary (as such terms are defined in section 3(7) and
3(8), respectively, of the Employee Retirement Income Security
Act of 1974) in such plan.
(2) Individual and group health insurance coverage.--The
terms ``individual health insurance coverage'' and ``group
health insurance coverage'' mean health insurance coverage
offered in the individual market or large or small group
market, respectively, as defined in section 2791 of the Public
Health Service Act.
SEC. 102. PROTECTING THE CHOICE TO KEEP CURRENT COVERAGE.
(a) Grandfathered Health Insurance Coverage Defined.--Subject to the
succeeding provisions of this section, for purposes of establishing
acceptable coverage under this division, the term ``grandfathered
health insurance coverage'' means individual health insurance coverage
that is offered and in force and effect before the first day of Y1 if
the following conditions are met:
(1) Limitation on new enrollment.--
(A) In general.--Except as provided in this
paragraph, the individual health insurance issuer
offering such coverage does not enroll any individual
in such coverage if the first effective date of
coverage is on or after the first day of Y1.
(B) Dependent coverage permitted.--Subparagraph (A)
shall not affect the subsequent enrollment of a
dependent of an individual who is covered as of such
first day.
(2) Limitation on changes in terms or conditions.--Subject to
paragraph (3) and except as required by law, the issuer does
not change any of its terms or conditions, including benefits
and cost-sharing, from those in effect as of the day before the
first day of Y1.
(3) Restrictions on premium increases.--The issuer cannot
vary the percentage increase in the premium for a risk group of
enrollees in specific grandfathered health insurance coverage
without changing the premium for all enrollees in the same risk
group at the same rate, as specified by the Commissioner.
(b) Grace Period for Current Employment-based Health Plans.--
(1) Grace period.--
(A) In general.--The Commissioner shall establish a
grace period whereby, for plan years beginning after
the end of the 5-year period beginning with Y1, an
employment-based health plan in operation as of the day
before the first day of Y1 must meet the same
requirements as apply to a qualified health benefits
plan under section 101, including the essential benefit
package requirement under section 121.
(B) Exception for limited benefits plans.--
Subparagraph (A) shall not apply to an employment-based
health plan in which the coverage consists only of one
or more of the following:
(i) Any coverage described in section
3001(a)(1)(B)(ii)(IV) of division B of the
American Recovery and Reinvestment Act of 2009
(PL 111-5).
(ii) Excepted benefits (as defined in section
733(c) of the Employee Retirement Income
Security Act of 1974), including coverage under
a specified disease or illness policy described
in paragraph (3)(A) of such section.
(iii) Such other limited benefits as the
Commissioner may specify.
In no case shall an employment-based health plan in
which the coverage consists only of one or more of the
coverage or benefits described in clauses (i) through
(iii) be treated as acceptable coverage under this
division
(2) Transitional treatment as acceptable coverage.--During
the grace period specified in paragraph (1)(A), an employment-
based health plan that is described in such paragraph shall be
treated as acceptable coverage under this division.
(c) Limitation on Individual Health Insurance Coverage.--
(1) In general.--Individual health insurance coverage that is
not grandfathered health insurance coverage under subsection
(a) may only be offered on or after the first day of Y1 as an
Exchange-participating health benefits plan.
(2) Separate, excepted coverage permitted.--Excepted benefits
(as defined in section 2791(c) of the Public Health Service
Act) are not included within the definition of health insurance
coverage. Nothing in paragraph (1) shall prevent the offering,
other than through the Health Insurance Exchange, of excepted
benefits so long as it is offered and priced separately from
health insurance coverage.
(3) Stand-alone dental and vision coverage permitted.--
Nothing in this division shall be construed--
(A) to prevent the offering of a stand-alone plans
that offer coverage of excepted benefits described in
section 2791(c)(2)(A) of the Public Health Service Act
(relating to limited scope dental or vision
benefits)for individuals and families from a State
licensed dental and vision carrier; or
(B) as applying requirements for a qualified health
benefits plan to such stand-alone plans that is offered
and priced separately from a qualified health benefits
plan.
Subtitle B--Standards Guaranteeing Access to Affordable Coverage
SEC. 111. PROHIBITING PREEXISTING CONDITION EXCLUSIONS.
A qualified health benefits plan may not impose any preexisting
condition exclusion (as defined in section 2701(b)(1)(A) of the Public
Health Service Act) or otherwise impose any limit or condition on the
coverage under the plan with respect to an individual or dependent
based on any health status-related factors (as defined in section
2791(d)(9) of the Public Health Service Act) in relation to the
individual or dependent.
SEC. 112. GUARANTEED ISSUE AND RENEWAL FOR INSURED PLANS.
The requirements of sections 2711 (other than subsections (c) and
(e)) and 2712 (other than paragraphs (3), and (6) of subsection (b) and
subsection (e)) of the Public Health Service Act, relating to
guaranteed availability and renewability of health insurance coverage,
shall apply to individuals and employers in all individual and group
health insurance coverage, whether offered to individuals or employers
through the Health Insurance Exchange, through any employment-based
health plan, or otherwise, and shall apply to the public health
insurance option, in the same manner as such sections apply to
employers and health insurance coverage offered in the small group
market, except that such section 2712(b)(1) shall apply only if, before
nonrenewal or discontinuation of coverage, the issuer has provided the
enrollee with notice of non-payment of premiums and there is a grace
period during which the enrollee has an opportunity to correct such
nonpayment. Rescissions of such coverage shall be prohibited except in
cases of fraud as defined in sections 2712(b)(2) of such Act.
SEC. 113. INSURANCE RATING RULES.
(a) In General.--The premium rate charged for an insured qualified
health benefits plan and for coverage under the public health insurance
option may not vary except as follows:
(1) Limited age variation permitted.--By age (within such age
categories as the Commissioner shall specify) so long as the
ratio of the highest such premium to the lowest such premium
does not exceed the ratio of 2 to 1.
(2) By area.--By premium rating area (as permitted by State
insurance regulators or, in the case of Exchange-participating
health benefits plans, as specified by the Commissioner in
consultation with such regulators).
(3) By family enrollment.--By family enrollment (such as
variations within categories and compositions of families) so
long as the ratio of the premium for family enrollment (or
enrollments) to the premium for individual enrollment is
uniform, as specified under State law and consistent with rules
of the Commissioner.
(b) Actuarial Value of Optional Service Coverage.--
(1) In general.--The Commissioner shall estimate the basic
per enrollee, per month cost, determined on an average
actuarial basis, for including coverage under a basic plan of
the services described in section 122(d)(4)(A).
(2) Considerations.--In making such estimate the
Commissioner--
(A) may take into account the impact on overall costs
of the inclusion of such coverage, but may not take
into account any cost reduction estimated to result
from such services, including prenatal care, delivery,
or postnatal care;
(B) shall estimate such costs as if such coverage
were included for the entire population covered; and
(C) may not estimate such a cost at less than $1 per
enrollee, per month.
(c) Study and Reports.--
(1) Study.--The Commissioner, in coordination with the
Secretary of Health and Human Services and the Secretary of
Labor, shall conduct a study of the large group insured and
self-insured employer health care markets. Such study shall
examine the following:
(A) The types of employers by key characteristics,
including size, that purchase insured products versus
those that self-insure.
(B) The similarities and differences between typical
insured and self-insured health plans.
(C) The financial solvency and capital reserve levels
of employers that self-insure by employer size.
(D) The risk of self-insured employers not being able
to pay obligations or otherwise becoming financially
insolvent.
(E) The extent to which rating rules are likely to
cause adverse selection in the large group market or to
encourage small and mid size employers to self-insure
(2) Reports.--Not later than 18 months after the date of the
enactment of this Act, the Commissioner shall submit to
Congress and the applicable agencies a report on the study
conducted under paragraph (1). Such report shall include any
recommendations the Commissioner deems appropriate to ensure
that the law does not provide incentives for small and mid-size
employers to self-insure or create adverse selection in the
risk pools of large group insurers and self-insured employers.
Not later than 18 months after the first day of Y1, the
Commissioner shall submit to Congress and the applicable
agencies an updated report on such study, including updates on
such recommendations.
SEC. 114. NONDISCRIMINATION IN BENEFITS; PARITY IN MENTAL HEALTH AND
SUBSTANCE ABUSE DISORDER BENEFITS.
(a) Nondiscrimination in Benefits.--A qualified health benefits plan
(including the public health insurance option) shall comply with
standards established by the Commissioner to prohibit discrimination in
health benefits or benefit structures for qualifying health benefits
plans, building from sections 702 of Employee Retirement Income
Security Act of 1974, 2702 of the Public Health Service Act, and
section 9802 of the Internal Revenue Code of 1986.
(b) Parity in Mental Health and Substance Abuse Disorder Benefits.--
To the extent such provisions are not superceded by or inconsistent
with subtitle C, the provisions of section 2705 (other than subsections
(a)(1), (a)(2), and (c)) of section 2705 of the Public Health Service
Act shall apply to a qualified health benefits plan, regardless of
whether it is offered in the individual or group market, in the same
manner as such provisions apply to health insurance coverage offered in
the large group market.
SEC. 115. ENSURING ADEQUACY OF PROVIDER NETWORKS.
(a) In General.--A qualified health benefits plan (including the
public health insurance option) that uses a provider network for items
and services shall meet such standards respecting provider networks as
the Commissioner may establish to assure the adequacy of such networks
in ensuring enrollee access to such items and services and transparency
in the cost-sharing differentials between in-network coverage and out-
of-network coverage.
(b) Provider Network Defined.--In this division, the term ``provider
network'' means the providers with respect to which covered benefits,
treatments, and services are available under a health benefits plan.
SEC. 116. ENSURING VALUE AND LOWER PREMIUMS.
(a) In General.--A qualified health benefits plan shall meet a
medical loss ratio as defined by the Commissioner. For any plan year in
which the qualified health benefits plan does not meet such medical
loss ratio, QHBP offering entity shall provide in a manner specified by
the Commissioner for rebates to enrollees of payment sufficient to meet
such loss ratio.
(b) Building on Interim Rules.--In implementing subsection (a), the
Commissioner shall build on the definition and methodology developed by
the Secretary of Health and Human Services under the amendments made by
section 161 for determining how to calculate the medical loss ratio.
Such methodology shall be set at the highest level medical loss ratio
possible that is designed to ensure adequate participation by QHBP
offering entities, competition in the health insurance market in and
out of the Health Insurance Exchange, and value for consumers so that
their premiums are used for services.
Subtitle C--Standards Guaranteeing Access to Essential Benefits
SEC. 121. COVERAGE OF ESSENTIAL BENEFITS PACKAGE.
(a) In General.--A qualified health benefits plan shall provide
coverage that at least meets the benefit standards adopted under
section 124 for the essential benefits package described in section 122
for the plan year involved.
(b) Choice of Coverage.--
(1) Non-exchange-participating health benefits plans.--In the
case of a qualified health benefits plan that is not an
Exchange-participating health benefits plan, such plan may
offer such coverage in addition to the essential benefits
package as the QHBP offering entity may specify.
(2) Exchange-participating health benefits plans.--In the
case of an Exchange-participating health benefits plan, such
plan is required under section 203 to provide specified levels
of benefits and, in the case of a plan offering a premium-plus
level of benefits, provide additional benefits.
(3) Continuation of offering of separate excepted benefits
coverage.--Nothing in this division shall be construed as
affecting the offering of health benefits in the form of
excepted benefits (described in section 102(b)(1)(B)(ii)) if
such benefits are offered under a separate policy, contract, or
certificate of insurance.
(c) No Restrictions on Coverage Unrelated to Clinical
Appropriateness.--A qualified health benefits plan may not impose any
restriction (other than cost-sharing) unrelated to clinical
appropriateness on the coverage of the health care items and services.
SEC. 122. ESSENTIAL BENEFITS PACKAGE DEFINED.
(a) In General.--In this division, the term ``essential benefits
package'' means health benefits coverage, consistent with standards
adopted under section 124 to ensure the provision of quality health
care and financial security, that--
(1) provides payment for the items and services described in
subsection (b) in accordance with generally accepted standards
of medical or other appropriate clinical or professional
practice;
(2) limits cost-sharing for such covered health care items
and services in accordance with such benefit standards,
consistent with subsection (c);
(3) does not impose any annual or lifetime limit on the
coverage of covered health care items and services;
(4) complies with section 115(a) (relating to network
adequacy); and
(5) is equivalent, as certified by Office of the Actuary of
the Centers for Medicare & Medicaid Services, to the average
prevailing employer-sponsored coverage.
(b) Minimum Services to Be Covered.--Subject to subsection (d), the
items and services described in this subsection are the following:
(1) Hospitalization.
(2) Outpatient hospital and outpatient clinic services,
including emergency department services.
(3) Professional services of physicians and other health
professionals.
(4) Such services, equipment, and supplies incident to the
services of a physician's or a health professional's delivery
of care in institutional settings, physician offices, patients'
homes or place of residence, or other settings, as appropriate.
(5) Prescription drugs.
(6) Rehabilitative and habilitative services.
(7) Mental health and substance use disorder services,
including behavioral health treatments.
(8) Preventive services, including those services recommended
with a grade of A or B by the Task Force on Clinical Preventive
Services and those vaccines recommended for use by the Director
of the Centers for Disease Control and Prevention.
(9) Maternity care.
(10) Well baby and well child care; treatment of a congenital
or developmental deformity, disease, or injury; and oral
health, vision, and hearing services, equipment, and supplies
at least for children under 21 years of age.
(c) Requirements Relating to Cost-sharing and Minimum Actuarial
Value.--
(1) No cost-sharing for preventive services.--There shall be
no cost-sharing under the essential benefits package for
preventive items and services (as specified under the benefit
standards), including well baby and well child care.
(2) Annual limitation.--
(A) Annual limitation.--The cost-sharing incurred
under the essential benefits package with respect to an
individual (or family) for a year does not exceed the
applicable level specified in subparagraph (B).
(B) Applicable level.--The applicable level specified
in this subparagraph for Y1 is $5,000 for an individual
and $10,000 for a family. Such levels shall be
increased (rounded to the nearest $100) for each
subsequent year by the annual percentage increase in
the Consumer Price Index (United States city average)
applicable to such year.
(C) Use of copayments.--In establishing cost-sharing
levels for basic, enhanced, and premium plans under
this subsection, the Secretary shall, to the maximum
extent possible, use only copayments and not
coinsurance.
(3) Minimum actuarial value.--
(A) In general.--The cost-sharing under the essential
benefits package shall be designed to provide a level
of coverage that is designed to provide benefits that
are actuarially equivalent to approximately 70 percent
of the full actuarial value of the benefits provided
under the reference benefits package described in
subparagraph (B).
(B) Reference benefits package described.--The
reference benefits package described in this
subparagraph is the essential benefits package if there
were no cost-sharing imposed.
(d) Abortion Coverage Prohibited as Part of Minimum Benefits
Package.--
(1) Prohibition of required coverage.--The Health Benefits
Advisory Committee may not recommend under section 123(b) and
the Secretary may not adopt in standards under section 124(b),
the services described in paragraph (4)(A) or (4)(B) as part of
the essential benefits package and the Commissioner may not
require such services for qualified health benefits plans to
participate in the Health Insurance Exchange.
(2) Voluntary choice of coverage by plan.--In the case of a
qualified health benefits plan, the plan is not required (or
prohibited) under this Act from providing coverage of services
described in paragraph (4)(A) or (4)(B) and the QHBP offering
entity shall determine whether such coverage is provided.
(3) Coverage under public health insurance option.--The
public health insurance option shall provide coverage for
services described in paragraph (4)(B). Nothing in this Act
shall be construed as preventing the public health insurance
option from providing for or prohibiting coverage of services
described in paragraph (4)(A).
(4) Abortion services.--
(A) Abortions for which public funding is
prohibited.--The services described in this
subparagraph are abortions for which the expenditure of
Federal funds appropriated for the Department of Health
and Human Services is not permitted, based on the law
as in effect as of the date that is 6 months before the
beginning of the plan year involved.
(B) Abortions for which public funding is allowed.--
The services described in this subparagraph are
abortions for which the expenditure of Federal funds
appropriated for the Department of Health and Human
Services is permitted, based on the law as in effect as
of the date that is 6 months before the beginning of
the plan year involved.
(e) Stand-alone Coverage.--
(1) No application to adult coverage.--Nothing in this
subtitle shall be construed as requiring an individual who is
21 years of age or older to be provided stand-alone dental-only
or vision-only coverage.
(2) Treatment of combined coverage.--The combination of
stand-alone coverage described in paragraph (1) and a qualified
health benefits plan without coverage of such oral and vision
services shall be treated as satisfying the essential benefits
package under this division.
SEC. 123. HEALTH BENEFITS ADVISORY COMMITTEE.
(a) Establishment.--
(1) In general.--There is established a private-public
advisory committee which shall be a panel of medical and other
experts to be known as the Health Benefits Advisory Committee
to recommend covered benefits and essential, enhanced, and
premium plans.
(2) Chair.--The Surgeon General shall be a member and the
chair of the Health Benefits Advisory Committee.
(3) Membership.--The Health Benefits Advisory Committee shall
be composed of the following members, in addition to the
Surgeon General:
(A) 9 members who are not Federal employees or
officers and who are appointed by the President.
(B) 9 members who are not Federal employees or
officers and who are appointed by the Comptroller
General of the United States in a manner similar to the
manner in which the Comptroller General appoints
members to the Medicare Payment Advisory Commission
under section 1805(c) of the Social Security Act.
(C) Such even number of members (not to exceed 8) who
are Federal employees and officers, as the President
may appoint.
Such initial appointments shall be made not later than 60 days
after the date of the enactment of this Act.
(4) Terms.--Each member of the Health Benefits Advisory
Committee shall serve a 3-year term on the Committee, except
that the terms of the initial members shall be adjusted in
order to provide for a staggered term of appointment for all
such members.
(5) Participation.--The membership of the Health Benefits
Advisory Committee shall at least reflect providers, consumer
representatives, employers, labor, health insurance issuers,
experts in health care financing and delivery, experts in
racial and ethnic disparities, experts in care for those with
disabilities, representatives of relevant governmental
agencies. and at least one practicing physician or other health
professional and an expert on children's health and shall
represent a balance among various sectors of the health care
system so that no single sector unduly influences the
recommendations of such Committee. Not less than 25 percent of
the members of the Committee shall be practicing health care
practitioners who, as of the date of their appointment,
practice in a rural area and who have practiced in a rural area
for at least the 5-year period preceding such date.
(b) Duties.--
(1) Recommendations on benefit standards.--The Health
Benefits Advisory Committee shall recommend to the Secretary of
Health and Human Services (in this subtitle referred to as the
``Secretary'') benefit standards (as defined in paragraph (4)),
and periodic updates to such standards. In developing such
recommendations, the Committee shall take into account
innovation in health care and consider how such standards could
reduce health disparities.
(2) Deadline.--The Health Benefits Advisory Committee shall
recommend initial benefit standards to the Secretary not later
than 1 year after the date of the enactment of this Act.
(3) Public input.--The Health Benefits Advisory Committee
shall allow for public input as a part of developing
recommendations under this subsection.
(4) Benefit standards defined.--In this subtitle, the term
``benefit standards'' means standards respecting--
(A) the essential benefits package described in
section 122, including categories of covered
treatments, items and services within benefit classes,
and cost-sharing consistent with subsection (d) of such
section; and
(B) the cost-sharing levels for enhanced plans and
premium plans (as provided under section 203(c))
consistent with paragraph (5).
(5) Levels of cost-sharing for enhanced and premium plans.--
(A) Enhanced plan.--The level of cost-sharing for
enhanced plans shall be designed so that such plans
have benefits that are actuarially equivalent to
approximately 85 percent of the actuarial value of the
benefits provided under the reference benefits package
described in section 122(c)(3)(B).
(B) Premium plan.--The level of cost-sharing for
premium plans shall be designed so that such plans have
benefits that are actuarially equivalent to
approximately 95 percent of the actuarial value of the
benefits provided under the reference benefits package
described in section 122(c)(3)(B).
(c) Operations.--
(1) Per diem pay.--Each member of the Health Benefits
Advisory Committee shall receive travel expenses, including per
diem in accordance with applicable provisions under subchapter
I of chapter 57 of title 5, United States Code, and shall
otherwise serve without additional pay.
(2) Members not treated as federal employees.--Members of the
Health Benefits Advisory Committee shall not be considered
employees of the Federal government solely by reason of any
service on the Committee.
(3) Application of faca.--The Federal Advisory Committee Act
(5 U.S.C. App.), other than section 14, shall apply to the
Health Benefits Advisory Committee.
(d) Publication.--The Secretary shall provide for publication in the
Federal Register and the posting on the Internet website of the
Department of Health and Human Services of all recommendations made by
the Health Benefits Advisory Committee under this section.
SEC. 124. PROCESS FOR ADOPTION OF RECOMMENDATIONS; ADOPTION OF BENEFIT
STANDARDS.
(a) Process for Adoption of Recommendations.--
(1) Review of recommended standards.--Not later than 45 days
after the date of receipt of benefit standards recommended
under section 123 (including such standards as modified under
paragraph (2)(B)), the Secretary shall review such standards
and shall determine whether to propose adoption of such
standards as a package.
(2) Determination to adopt standards.--If the Secretary
determines--
(A) to propose adoption of benefit standards so
recommended as a package, the Secretary shall, by
regulation under section 553 of title 5, United States
Code, propose adoption such standards; or
(B) not to propose adoption of such standards as a
package, the Secretary shall notify the Health Benefits
Advisory Committee in writing of such determination and
the reasons for not proposing the adoption of such
recommendation and provide the Committee with a further
opportunity to modify its previous recommendations and
submit new recommendations to the Secretary on a timely
basis.
(3) Contingency.--If, because of the application of paragraph
(2)(B), the Secretary would otherwise be unable to propose
initial adoption of such recommended standards by the deadline
specified in subsection (b)(1), the Secretary shall, by
regulation under section 553 of title 5, United States Code,
propose adoption of initial benefit standards by such deadline.
(4) Publication.--The Secretary shall provide for publication
in the Federal Register of all determinations made by the
Secretary under this subsection.
(b) Adoption of Standards.--
(1) Initial standards.--Not later than 18 months after the
date of the enactment of this Act, the Secretary shall, through
the rulemaking process consistent with subsection (a), adopt an
initial set of benefit standards.
(2) Periodic updating standards.--Under subsection (a), the
Secretary shall provide for the periodic updating of the
benefit standards previously adopted under this section.
(3) Requirement.--The Secretary may not adopt any benefit
standards for an essential benefits package or for level of
cost-sharing that are inconsistent with the requirements for
such a package or level under sections 122 (including
subsection (d)) and 123(b)(5).
SEC. 125. PROHIBITION OF DISCRIMINATION IN HEALTH CARE SERVICES BASED
ON RELIGIOUS OR SPIRITUAL CONTENT.
Neither the Commissioner nor any health insurance issuer offering
health insurance coverage through the Health Insurance Exchange shall
discriminate in approving or covering a health care service on the
basis of its religious or spiritual content if expenditures for such a
health care service are allowable as a deduction under section 213(d)
of the Internal Revenue Code of 1986, as in effect on January 1, 2009.
Subtitle D--Additional Consumer Protections
SEC. 131. REQUIRING FAIR MARKETING PRACTICES BY HEALTH INSURERS.
The Commissioner shall establish uniform marketing standards that all
insured QHBP offering entities shall meet.
SEC. 132. REQUIRING FAIR GRIEVANCE AND APPEALS MECHANISMS.
A QHBP offering entity shall provide for timely grievance and appeals
mechanisms as the Commissioner shall establish consistent with sections
139 through 139B.
SEC. 133. REQUIRING INFORMATION TRANSPARENCY AND PLAN DISCLOSURE.
(a) Accurate and Timely Disclosure.--
(1) In general.--A qualified health benefits plan (including
the public health insurance option) shall comply with standards
established by the Commissioner for the accurate and timely
disclosure of plan documents, plan terms and conditions, claims
payment policies and practices, periodic financial disclosure,
data on enrollment, data on disenrollment, data on the number
of claims denials, data on rating practices, information on
cost-sharing and payments with respect to any out-of-network
coverage, and other information as determined appropriate by
the Commissioner. The Commissioner shall require that such
disclosure be provided in plain language.
(2) Plain language.--In this subsection, the term ``plain
language'' means language that the intended audience, including
individuals with limited English proficiency, can readily
understand and use because that language is clean, concise,
well-organized, and follows other best practices of plain
language writing.
(3) Guidance.--The Commissioner shall develop and issue
guidance on best practices of plain language writing.
(b) Contracting Reimbursement.--A qualified health benefits plan
(including the public health insurance option) shall comply with
standards established by the Commissioner to ensure transparency to
each health care provider relating to reimbursement arrangements
between such plan and such provider.
(c) Advance Notice of Plan Changes.--A change in a qualified health
benefits plan (including the public health insurance option) shall not
be made without such reasonable and timely advance notice to enrollees
of such change.
(d) Pharmacy Benefit Managers Transparency Requirements.--
(1) In general.--Notwithstanding any other provision of law,
a qualified health benefits plan shall enter into a contract
with a pharmacy benefit managers (in this subsection referred
to as a ``PBM'') to manage the prescription drug coverage
provided under such plan, or to control the costs of such
prescription drug coverage, only if as a condition of such
contract the PBM is required to provide at least annually to
the Commissioner and to the QHBP offering entity offering such
plan the following information:
(A) Information on the volume of prescriptions under
the contract that are filled via mail order and at
retail pharmacies.
(B) An estimate of aggregate average payments under
the contract, per prescription (weighted by
prescription volume), made to mail order and retail
pharmacists, and the average amount, per prescription,
that the PBM was paid by the plan for prescriptions
filled at mail order and retail pharmacists.
(C) An estimate of the aggregate average payment per
prescription (weighted by prescription volume) under
the contract received from pharmaceutical
manufacturers, including all rebates, discounts, prices
concessions, or administrative, and other payments from
pharmaceutical manufacturers, and a description of the
types of payments, and the amount of these payments
that were shared with the plan, and a description of
the percentage of prescriptions for which the PBM
received such payments.
(D) Information on the overall percentage of generic
drugs dispensed under the contract at retail and mail
order pharmacies, and the percentage of cases in which
a generic drug is dispensed when available.
(E) Information on the percentage and number of cases
under the contract in which individuals were switched
from a prescribed drug that was less expensive to a
drug that was more expensive, the rationale for these
switches, and a description of the PBM policies
governing such switches.
(2) Confidentiality of information.--Notwithstanding any
other provision of law, information disclosed by a PBM to the
Commissioner or a QHBP offering entity under this subsection is
confidential and shall not be disclosed by the Commissioner or
the QHBP offering entity in a form which discloses the identity
of a specific PBM or prices charged by such PBM or a specific
retailer, manufacturer, or wholesaler, except--
(A) as the Commissioner determines to be necessary to
carry out this subsection;
(B) to permit the Comptroller General to review the
information provided;
(C) to permit the Director of the Congressional
Budget Office to review the information provided; and
(D) to permit the Commissioner to disclose industry-
wide aggregate or average information to be used in
assessing the overall impact of PBMs on prescription
drug prices and spending.
SEC. 134. APPLICATION TO QUALIFIED HEALTH BENEFITS PLANS NOT OFFERED
THROUGH THE HEALTH INSURANCE EXCHANGE.
The requirements of the previous provisions of this subtitle shall
apply to qualified health benefits plans that are not being offered
through the Health Insurance Exchange only to the extent specified by
the Commissioner.
SEC. 135. TIMELY PAYMENT OF CLAIMS.
A QHBP offering entity shall comply with the requirements of section
1857(f) of the Social Security Act with respect to a qualified health
benefits plan it offers in the same manner an Medicare Advantage
organization is required to comply with such requirements with respect
to a Medicare Advantage plan it offers under part C of Medicare.
SEC. 136. STANDARDIZED RULES FOR COORDINATION AND SUBROGATION OF
BENEFITS.
The Commissioner shall establish standards for the coordination and
subrogation of benefits and reimbursement of payments in cases
involving individuals and multiple plan coverage.
SEC. 137. APPLICATION OF ADMINISTRATIVE SIMPLIFICATION.
A QHBP offering entity is required to comply with standards for
electronic financial and administrative transactions under section
1173A of the Social Security Act and the operating rules under section
1173B of such Act, as added by section 163(a).
SEC. 138. INFORMATION ON END-OF-LIFE PLANNING.
(a) In General.--The QHBP offering entity --
(1) shall provide for the dissemination of information
related to end-of-life planning to individuals seeking
enrollment in Exchange-participating health benefits plans
offered through the Exchange;
(2) shall present such individuals with--
(A) the option to establish advanced directives and
physician's orders for life sustaining treatment
according to the laws of the State in which the
individual resides; and
(B) information related to other planning tools; and
(3) shall not promote suicide, assisted suicide, or the
active hastening of death.
The information presented under paragraph (2) shall not presume the
withdrawal of treatment and shall include end-of-life planning
information that includes options to maintain all or most medical
interventions.
(b) Construction.-- Nothing in this section shall be construed--
(1) to require an individual to complete an advanced
directive or a physician's order for life sustaining treatment
or other end-of-life planning document;
(2) to require an individual to consent to restrictions on
the amount, duration, or scope of medical benefits otherwise
covered under a qualified health benefits plan; or
(3) to encourage the hastening of death or the promotion of
assisted suicide.
(c) Advanced Directive Defined.--In this section, the term ``advanced
directive'' includes a living will, a comfort care order, or a durable
power of attorney for health care
(d) Prohibition on the Promotion of Assisted Suicide.--
(1) In general.--Subject to paragraph (3), information
provided to meet the requirements of subsection (a)(2) shall
not include advanced directives or other planning tools that
list or describe as an option suicide, assisted suicide or the
intentional hastening of death regardless of legality.
(2) Construction.--Nothing in paragraph (1) shall be
construed to apply to or affect any option to--
(A) the withhold or withdraw of medical treatment or
medical care;
(B) withhold or withdraw of nutrition or hydration;
and
(C) provide palliative or hospice care or use an
item, good, benefit, or service furnished for the
purpose of alleviating pain or discomfort, even if such
use may increase the risk of death, so long as such
item, good, benefit, or service is not also furnished
for the purpose of causing, or the purpose of assisting
in causing, death, for any reason.
(3) Exemption.--The requirements of subsection (a) shall not
apply to any State that as of August 1, 2009, requires the
inclusion of information prohibited in such paragraph in
advanced directives or other planning tools.
SEC. 139. UTILIZATION REVIEW ACTIVITIES.
(a) Compliance With Requirements.--
(1) In general.--A qualified health benefits plan, and a QHBP
offering entity that offers such plan, shall conduct
utilization review activities in connection with the provision
of benefits under such plan only in accordance with a
utilization review program that meets the requirements of this
section.
(2) Use of outside agents.--Nothing in this section shall be
construed as preventing a qualified health benefits plan or
QHBP offering entity from arranging through a contract or
otherwise for persons or entities to conduct utilization review
activities on behalf of the plan entity, so long as such
activities are conducted in accordance with a utilization
review program that meets the requirements of this section.
(3) Utilization review defined.--For purposes of this
section, the terms ``utilization review'' and ``utilization
review activities'' mean procedures used to monitor or evaluate
the use or coverage, clinical necessity, appropriateness,
efficacy, or efficiency of health care services, procedures or
settings, and includes prospective review, concurrent review,
second opinions, case management, discharge planning, or
retrospective review.
(b) Written Policies and Criteria.--
(1) Written policies.--A utilization review program shall be
conducted consistent with written policies and procedures that
govern all aspects of the program.
(2) Use of written criteria.--
(A) In general.--Such a program shall utilize written
clinical review criteria developed with input from a
range of appropriate actively practicing health care
professionals, as determined by the plan, pursuant to
the program. Such criteria shall include written
clinical review criteria that are based on valid
clinical evidence where available and that are directed
specifically at meeting the needs of at-risk
populations and covered individuals with chronic
conditions or severe illnesses, including gender-
specific criteria and pediatric-specific criteria where
available and appropriate.
(B) Continuing use of standards in retrospective
review.--If a health care service has been specifically
pre-authorized or approved for an enrollee under such a
program, the program shall not, pursuant to
retrospective review, revise or modify the specific
standards, criteria, or procedures used for the
utilization review for procedures, treatment, and
services delivered to the enrollee during the same
course of treatment.
(C) Review of sample of claims denials.--Such a
program shall provide for an evaluation of the clinical
appropriateness of at least a sample of denials of
claims for benefits.
(c) Conduct of Program Activities.--
(1) Administration by health care professionals.--A
utilization review program shall be administered by qualified
health care professionals who shall oversee review decisions.
(2) Use of qualified, independent personnel.--
(A) In general.--A utilization review program shall
provide for the conduct of utilization review
activities only through personnel who are qualified and
have received appropriate training in the conduct of
such activities under the program.
(B) Prohibition of contingent compensation
arrangements.--Such a program shall not, with respect
to utilization review activities, permit or provide
compensation or anything of value to its employees,
agents, or contractors in a manner that encourages
denials of claims for benefits.
(C) Prohibition of conflicts.--Such a program shall
not permit a health care professional who is providing
health care services to an individual to perform
utilization review activities in connection with the
health care services being provided to the individual.
(3) Accessibility of review.--Such a program shall provide
that appropriate personnel performing utilization review
activities under the program, including the utilization review
administrator, are reasonably accessible by toll-free telephone
during normal business hours to discuss patient care and allow
response to telephone requests, and that appropriate provision
is made to receive and respond promptly to calls received
during other hours.
(4) Limits on frequency.--Such a program shall not provide
for the performance of utilization review activities with
respect to a class of services furnished to an individual more
frequently than is reasonably required to assess whether the
services under review are medically necessary or appropriate.
(d) Deadline for Determinations.--
(1) Prior authorization services.--
(A) In general.--Except as provided in paragraph (2),
in the case of a utilization review activity involving
the prior authorization of health care items and
services for an individual, the utilization review
program shall make a determination concerning such
authorization, and provide notice of the determination
to the individual or the individual's designee and the
individual's health care provider by telephone and in
printed form, as soon as possible in accordance with
the medical exigencies of the case, and in no event
later than the deadline specified in subparagraph (B).
(B) Deadline.--
(i) In general.--Subject to clauses (ii),
(iii), and (iv), the deadline specified in this
subparagraph is 14 days after the date of
receipt of the request for prior authorization,
but in no event later than 3 business days
after the date of receipt of information that
is reasonably necessary to make such
determination.
(ii) Extension permitted where notice of
additional information required.--If a
utilization review program--
(I) receives a request for a prior
authorization;
(II) determines that additional
information is necessary to complete
the review and make the determination
on the request; and
(III) notifies the requester, not
later than 5 business days after the
date of receiving the request, of the
need for such specified additional
information;
the deadline specified in this subparagraph is
14 days after the date the program receives the
specified additional information, but in no
case later than 28 days after the date of
receipt of the request for the prior
authorization. This clause shall not apply if
the deadline is specified in clause (iii).
(iii) Expedited cases.--In the case of a
situation described in section 139A(c)(1)(A),
the deadline specified in this subparagraph is
72 hours after the time of the request for
prior authorization.
(iv) Exception for emergency services.--No
prior approval shall be required in the case of
emergency services provided by a hospital.
(2) Ongoing care.--
(A) Concurrent review.--
(i) In general.--Subject to subparagraph (B),
in the case of a concurrent review of ongoing
care (including hospitalization), which results
in a termination or reduction of such care, the
plan must provide by telephone and in printed
form notice of the concurrent review
determination to the individual or the
individual's designee and the individual's
health care provider as soon as possible in
accordance with the medical exigencies of the
case, and in no event later than 1 business day
after the date of receipt of information that
is reasonably necessary to make such
determination, with sufficient time prior to
the termination or reduction to allow for an
appeal under section 139A(c)(1)(A) to be
completed before the termination or reduction
takes effect.
(ii) Contents of notice.--Such notice shall
include, with respect to ongoing health care
items and services, the number of ongoing
services approved, the new total of approved
services, the date of onset of services, and
the next review date, if any, as well as a
statement of the individual"s rights to further
appeal.
(B) Exception.--Subparagraph (A) shall not be
interpreted as requiring plans or issuers to provide
coverage of care that would exceed the coverage
limitations for such care.
(3) Previously provided services.--In the case of a
utilization review activity involving retrospective review of
health care services previously provided for an individual, the
utilization review program shall make a determination
concerning such services, and provide notice of the
determination to the individual or the individual's designee
and the individual's health care provider by telephone and in
printed form, within 30 days of the date of receipt of
information that is reasonably necessary to make such
determination, but in no case later than 60 days after the date
of receipt of the claim for benefits.
(4) Failure to meet deadline.--In a case in which a qualified
health benefits plan or QHBP offering entity fails to make a
determination on a claim for benefit under paragraph (1),
(2)(A), or (3) by the applicable deadline established under the
respective paragraph, the failure shall be treated under this
subtitle as a denial of the claim as of the date of the
deadline.
(e) Notice of Denials of Claims for Benefits.--
(1) In general.--Notice of a denial of claims for benefits
under a utilization review program shall be provided in printed
form and written in a manner calculated to be understood by the
participant, beneficiary, or enrollee and shall include--
(A) the reasons for the denial (including the
clinical rationale);
(B) instructions on how to initiate an appeal under
section 139A; and
(C) notice of the availability, upon request of the
individual (or the individual"s designee) of the
clinical review criteria relied upon to make such
denial.
(2) Specification of any additional information.--Such a
notice shall also specify what (if any) additional necessary
information must be provided to, or obtained by, the person
making the denial in order to make a decision on such an
appeal.
(f) Claim for Benefits and Denial of Claim for Benefits Defined.--For
purposes of this subtitle:
(1) Claim for benefits.--The term ``claim for benefits''
means any request for coverage (including authorization of
coverage), for eligibility, or for payment in whole or in part,
for an item or service under a qualified health benefits plan.
(2) Denial of claim for benefits.--The term ``denial'' means,
with respect to a claim for benefits, means a denial, or a
failure to act on a timely basis upon, in whole or in part, the
claim for benefits and includes a failure to provide benefits
(including items and services) required to be provided under
this title.
SEC. 139A. INTERNAL APPEALS PROCEDURES.
(a) Right of Review.--
(1) In general.--Each qualified health benefits plan, and
each QHBP offering entity offering such plan--
(A) shall provide adequate notice in writing to any
participant or beneficiary under such plan, or enrollee
under such coverage, whose claim for benefits under the
plan has been denied (within the meaning of section
139(f)(2)), setting forth the specific reasons for such
denial of claim for benefits and rights to any further
review or appeal, written in a manner calculated to be
understood by the participant, beneficiary, or
enrollee; and
(B) shall afford such a participant, beneficiary, or
enrollee (and any provider or other person acting on
behalf of such an individual with the individual"s
consent or without such consent if the individual is
medically unable to provide such consent) who is
dissatisfied with such a denial of claim for benefits a
reasonable opportunity (of not less than 180 days) to
request and obtain a full and fair review by a named
fiduciary (with respect to such plan) or named
appropriate individual (with respect to such coverage)
of the decision denying the claim.
(2) Treatment of oral requests.--The request for review under
paragraph (1)(B) may be made orally, but, in the case of an
oral request, shall be followed by a request in writing.
(b) Internal Review Process.--
(1) Conduct of review.--
(A) In general.--A review of a denial of claim under
this section shall be made by an individual who--
(i) in a case involving medical judgment,
shall be a physician or, in the case of limited
scope coverage (as defined in subparagraph (B),
shall be an appropriate specialist;
(ii) has been selected by the plan or entity;
and
(iii) did not make the initial denial in the
internally appealable decision.
(B) Limited scope coverage defined.--For purposes of
subparagraph (A), the term ``limited scope coverage''
means a qualified health benefits plan the only
benefits under which are for benefits described in
section 2791(c)(2)(A) of the Public Health Service Act
(42 U.S.C. 300gg-91(c)(2)).
(2) Time limits for internal reviews.--
(A) In general.--Having received such a request for
review of a denial of claim, the QHBP offering entity
offering a qualified health benefits plan, in
accordance with the medical exigencies of the case but
not later than the deadline specified in subparagraph
(B), complete the review on the denial and transmit to
the participant, beneficiary, enrollee, or other person
involved a decision that affirms, reverses, or modifies
the denial. If the decision does not reverse the
denial, the plan or issuer shall transmit, in printed
form, a notice that sets forth the grounds for such
decision and that includes a description of rights to
any further appeal. Such decision shall be treated as
the final decision of the plan. Failure to issue such a
decision by such deadline shall be treated as a final
decision affirming the denial of claim.
(B) Deadline.--
(i) In general.--Subject to clauses (ii) and
(iii), the deadline specified in this
subparagraph is 14 days after the date of
receipt of the request for internal review.
(ii) Extension permitted where notice of
additional information required.--If a
qualified health benefits plan of QHBP offering
entity--
(I) receives a request for internal
review,
(II) determines that additional
information is necessary to complete
the review and make the determination
on the request, and
(III) notifies the requester, not
later than 5 business days after the
date of receiving the request, of the
need for such specified additional
information,
the deadline specified in this subparagraph is
14 days after the date the plan or entity
receives the specified additional information,
but in no case later than 28 days after the
date of receipt of the request for the internal
review. This clause shall not apply if the
deadline is specified in clause (iii).
(iii) Expedited cases.--In the case of a
situation described in subsection (c)(1)(A),
the deadline specified in this subparagraph is
72 hours after the time of the request for
review.
(c) Expedited Review Process.--
(1) In general.--A qualified health benefits plan, and a QHBP
offering entity, shall establish procedures in writing for the
expedited consideration of requests for review under subsection
(b) in situations--
(A) in which, as determined by the plan or issuer or
as certified in writing by a treating health care
professional, the application of the normal timeframe
for making a determination could seriously jeopardize
the life or health of the participant, beneficiary, or
enrollee or such an individual"s ability to regain
maximum function; or
(B) described in section 139(d)(2) (relating to
requests for continuation of ongoing care which would
otherwise be reduced or terminated).
(2) Process.--Under such procedures--
(A) the request for expedited review may be submitted
orally or in writing by an individual or provider who
is otherwise entitled to request the review;
(B) all necessary information, including the plan's
or entity's decision, shall be transmitted between the
plan or issuer and the requester by telephone,
facsimile, or other similarly expeditious available
method; and
(C) the plan or issuer shall expedite the review in
the case of any of the situations described in
subparagraph (A) or (B) of paragraph (1).
(3) Deadline for decision.--The decision on the expedited
review must be made and communicated to the parties as soon as
possible in accordance with the medical exigencies of the case,
and in no event later than 72 hours after the time of receipt
of the request for expedited review, except that in a case
described in paragraph (1)(B), the decision must be made before
the end of the approved period of care.
(d) Waiver of Process.--A plan or entity may waive its rights for an
internal review under subsection (b). In such case the participant,
beneficiary, or enrollee involved (and any designee or provider
involved) shall be relieved of any obligation to complete the review
involved and may, at the option of such participant, beneficiary,
enrollee, designee, or provider, proceed directly to seek further
appeal through any applicable external appeals process.
SEC. 139B. EXTERNAL APPEALS PROCEDURES.
(a) Right to External Appeal.--
(1) In general.--A qualified health benefits plan, and a QHBP
offering entity, shall provide for an external appeals process
that meets the requirements of this section in the case of an
externally appealable decision described in paragraph (2), for
which a timely appeal is made either by the plan or entity or
by the participant, beneficiary, or enrollee (and any provider
or other person acting on behalf of such an individual with the
individual's consent or without such consent if such an
individual is medically unable to provide such consent). The
appropriate Secretary shall establish standards to carry out
such requirements.
(2) Externally appealable decision defined.--
(A) In general.--For purposes of this section, the
term ``externally appealable decision'' means a denial
of claim for benefits (as defined in section
139(f)(2))--
(i) that is based in whole or in part on a
decision that the item or service is not
medically necessary or appropriate or is
investigational or experimental; or
(ii) in which the decision as to whether a
benefit is covered involves a medical judgment.
(B) Inclusion.--Such term also includes a failure to
meet an applicable deadline for internal review under
section 139A.
(C) Exclusions.--Such term does not include--
(i) specific exclusions or express
limitations on the amount, duration, or scope
of coverage that do not involve medical
judgment; or
(ii) a decision regarding whether an
individual is a participant, beneficiary, or
enrollee under the plan.
(3) Exhaustion of internal review process.--Except as
provided under section 139A(d), a plan or entity may condition
the use of an external appeal process in the case of an
externally appealable decision upon a final decision in an
internal review under section 140, but only if the decision is
made in a timely basis consistent with the deadlines provided
under this subtitle.
(4) Filing fee requirement.--
(A) In general.--Subject to subparagraph (B), a plan
or entity may condition the use of an external appeal
process upon payment to the plan or entity of a filing
fee that does not exceed $25.
(B) Exception for indigency.--The plan or issuer may
not require payment of the filing fee in the case of an
individual participant, beneficiary, or enrollee who
certifies (in a form and manner specified in guidelines
established by the Secretary of Health and Human
Services) that the individual is indigent (as defined
in such guidelines).
(C) Refunding fee in case of successful appeals.--The
plan or entity shall refund payment of the filing fee
under this paragraph if the recommendation of the
external appeal entity is to reverse or modify the
denial of a claim for benefits which is the subject of
the appeal.
(b) General Elements of External Appeals Process.--
(1) Contract with qualified external appeal entity.--
(A) Contract requirement.--Except as provided in
subparagraph (D), the external appeal process under
this section of a plan or entity shall be conducted
under a contract between the plan or issuer and one or
more qualified external appeal entities (as defined in
subsection (c)).
(B) Limitation on plan or issuer selection.--The
applicable authority shall implement procedures--
(i) to assure that the selection process
among qualified external appeal entities will
not create any incentives for external appeal
entities to make a decision in a biased manner,
and
(ii) for auditing a sample of decisions by
such entities to assure that no such decisions
are made in a biased manner.
(C) Other terms and conditions.--The terms and
conditions of a contract under this paragraph shall be
consistent with the standards the appropriate Secretary
shall establish to assure there is no real or apparent
conflict of interest in the conduct of external appeal
activities. Such contract shall provide that all costs
of the process (except those incurred by the
participant, beneficiary, enrollee, or treating
professional in support of the appeal) shall be paid by
the plan or entity, and not by the participant,
beneficiary, or enrollee. The previous sentence shall
not be construed as applying to the imposition of a
filing fee under subsection (a)(4).
(D) State authority with respect to qualified
external appeal entity for health insurance issuers.--
With respect to QHBP offering entities offering
qualified health benefits plans in a State, the State
may provide for external review activities to be
conducted by a qualified external appeal entity that is
designated by the State or that is selected by the
State in a manner determined by the State to assure an
unbiased determination.
(2) Elements of process.--An external appeal process shall be
conducted consistent with standards established by the
appropriate Secretary that include at least the following:
(A) Fair and de novo determination.--The process
shall provide for a fair, de novo determination.
However, nothing in this paragraph shall be construed
as providing for coverage of items and services for
which benefits are specifically excluded under the
plan.
(B) Standard of review.--An external appeal entity
shall determine whether the plan's or issuer's decision
is in accordance with the medical needs of the patient
involved (as determined by the entity) taking into
account, as of the time of the entity's determination,
the patient's medical condition and any relevant and
reliable evidence the entity obtains under subparagraph
(D). If the entity determines the decision is in
accordance with such needs, the entity shall affirm the
decision and to the extent that the entity determines
the decision is not in accordance with such needs, the
entity shall reverse or modify the decision.
(C) Consideration of plan or coverage definitions.--
In making such determination, the external appeal
entity shall consider (but not be bound by) any
language in the plan or coverage document relating to
the definitions of the terms medical necessity,
medically necessary or appropriate, or experimental,
investigational, or related terms.
(D) Evidence.--
(i) In general.--An external appeal entity
shall include, among the evidence taken into
consideration--
(I) the decision made by the plan or
QHBP offering entity upon internal
review under section 140 and any
guidelines or standards used by the
plan or QHBP offering entity in
reaching such decision;
(II) any personal health and medical
information supplied with respect to
the individual whose denial of claim
for benefits has been appealed; and
(III) the opinion of the individual's
treating physician or health care
professional.
(ii) Additional evidence.--Such external
appeal entity may also take into consideration
but not be limited to the following evidence
(to the extent available):
(I) The results of studies that meet
professionally recognized standards of
validity and replicability or that have
been published in peer-reviewed
journals.
(II) The results of professional
consensus conferences conducted or
financed in whole or in part by one or
more government agencies.
(III) Practice and treatment
guidelines prepared or financed in
whole or in part by government
agencies.
(IV) Government-issued coverage and
treatment policies.
(V) Community standard of care and
generally accepted principles of
professional medical practice.
(VI) To the extent that the entity
determines it to be free of any
conflict of interest, the opinions of
individuals who are qualified as
experts in one or more fields of health
care which are directly related to the
matters under appeal.
(VII) To the extent that the entity
determines it to be free of any
conflict of interest, the results of
peer reviews conducted by the plan
involved.
(E) Determination concerning externally appealable
decisions.--A qualified external appeal entity shall
determine--
(i) whether a denial of claim for benefits is
an externally appealable decision (within the
meaning of subsection (a)(2));
(ii) whether an externally appealable
decision involves an expedited appeal; and
(iii) for purposes of initiating an external
review, whether the internal review process has
been completed.
(F) Opportunity to submit evidence.--Each party to an
externally appealable decision may submit evidence
related to the issues in dispute.
(G) Provision of information.--The plan or issuer
involved shall provide timely access to the external
appeal entity to information and to provisions of the
plan relating to the matter of the externally
appealable decision, as determined by the entity.
(H) Timely decisions.--A determination by the
external appeal entity on the decision shall--
(i) be made orally or in writing and, if it
is made orally, shall be supplied to the
parties in writing as soon as possible;
(ii) be made in accordance with the medical
exigencies of the case involved, but in no
event later than 21 days after the date (or, in
the case of an expedited appeal, 72 hours after
the time) of requesting an external appeal of
the decision;
(iii) state, in layperson's language, the
basis for the determination, including, if
relevant, any basis in the terms or conditions
of the plan; and
(iv) inform the participant, beneficiary, or
enrollee of the individual's rights (including
any limitation on such rights) to seek further
review by the courts (or other process) of the
external appeal determination.
(I) Compliance with determination.--If the external
appeal entity reverses or modifies the denial of a
claim for benefits, the plan shall--
(i) upon the receipt of the determination,
authorize benefits in accordance with such
determination;
(ii) take such actions as may be necessary to
provide benefits (including items or services)
in a timely manner consistent with such
determination; and
(iii) submit information to the entity
documenting compliance with the entity's
determination and this subparagraph.
(c) Qualifications of External Appeal Entities.--
(1) In general.--For purposes of this section, the term
``qualified external appeal entity'' means, in relation to a
plan or issuer, an entity that is certified under paragraph (2)
as meeting the following requirements:
(A) The entity meets the independence requirements of
paragraph (3).
(B) The entity conducts external appeal activities
through a panel of not fewer than 3 clinical peers.
(C) The entity has sufficient medical, legal, and
other expertise and sufficient staffing to conduct
external appeal activities for the plan on a timely
basis consistent with subsection (b)(2)(G).
(D) The entity meets such other requirements as the
appropriate Secretary may impose.
(2) Initial certification of external appeal entities.--
(A) In general.--In order to be treated as a
qualified external appeal entity with respect to--
(i) a qualified health benefits plan that is
a group health plan, the entity must be
certified (and, in accordance with subparagraph
(B), periodically recertified) as meeting the
requirements of paragraph (1)--
(I) by the Secretary of Labor;
(II) under a process recognized or
approved by the Secretary of Labor; or
(III) to the extent provided in
subparagraph (C)(i), by a qualified
private standard-setting organization
(certified under such subparagraph); or
(ii) a QHBP offering entity that is a health
insurance issuer operating in a State, the
qualified external appeal entity must be
certified (and, in accordance with subparagraph
(B), periodically recertified) as meeting such
requirements--
(I) by the applicable State authority
(or under a process recognized or
approved by such authority); or
(II) if the State has not established
a certification and recertification
process for such entities, by the
Secretary of Health and Human Services,
under a process recognized or approved
by such Secretary, or to the extent
provided in subparagraph (C)(ii), by a
qualified private standard-setting
organization (certified under such
subparagraph).
(B) Recertification process.--The appropriate
Secretary shall develop standards for the
recertification of external appeal entities. Such
standards shall include a review of--
(i) the number of cases reviewed;
(ii) a summary of the disposition of those
cases;
(iii) the length of time in making
determinations on those cases;
(iv) updated information of what was required
to be submitted as a condition of certification
for the entity's performance of external appeal
activities; and
(v) such information as may be necessary to
assure the independence of the entity from the
plans or issuers for which external appeal
activities are being conducted.
(C) Certification of qualified private standard-
setting organizations.--
(i) For external reviews of group health
plans.--For purposes of subparagraph
(A)(i)(III), the Secretary of Labor may provide
for a process for certification (and periodic
recertification) of qualified private standard-
setting organizations which provide for
certification of external review entities. Such
an organization shall only be certified if the
organization does not certify an external
review entity unless it meets standards
required for certification of such an entity by
such Secretary under subparagraph (A)(i)(I).
(ii) For external reviews of health insurance
issuers.--For purposes of subparagraph
(A)(ii)(II), the Secretary of Health and Human
Services may provide for a process for
certification (and periodic recertification) of
qualified private standard-setting
organizations which provide for certification
of external review entities. Such an
organization shall only be certified if the
organization does not certify an external
review entity unless it meets standards
required for certification of such an entity by
such Secretary under subparagraph (A)(ii)(II).
(3) Independence requirements.--
(A) In general.--A clinical peer or other entity
meets the independence requirements of this paragraph
if--
(i) the peer or entity does not have a
familial, financial, or professional
relationship with any related party;
(ii) any compensation received by such peer
or entity in connection with the external
review is reasonable and not contingent on any
decision rendered by the peer or entity;
(iii) except as provided in paragraph (4),
the plan and the issuer have no recourse
against the peer or entity in connection with
the external review; and
(iv) the peer or entity does not otherwise
have a conflict of interest with a related
party as determined under any regulations which
the Secretary may prescribe.
(B) Related party.--For purposes of this paragraph,
the term ``related party'' means--
(i) with respect to--
(I) a qualified health benefits plan
that is a group health plan, the plan
or QHBP offering entity of such plan;
or
(II) a qualified health benefits plan
that is individual health insurance
coverage, the health insurance issuer
offering such coverage, or any plan
sponsor, fiduciary, officer, director,
or management employee of such plan or
issuer;
(ii) the health care professional that
provided the health care involved in the
coverage decision;
(iii) the institution at which the health
care involved in the coverage decision is
provided;
(iv) the manufacturer of any drug or other
item that was included in the health care
involved in the coverage decision; or
(v) any other party determined under any
regulations which the Secretary may prescribe
to have a substantial interest in the coverage
decision.
(4) Limitation on liability of reviewers.--No qualified
external appeal entity having a contract with a qualified
health benefits plan under this part and no person who is
employed by any such entity or who furnishes professional
services to such entity, shall be held by reason of the
performance of any duty, function, or activity required or
authorized pursuant to this section, to have violated any
criminal law, or to be civilly liable under any law of the
United States or of any State (or political subdivision
thereof) if due care was exercised in the performance of such
duty, function, or activity and there was no actual malice or
gross misconduct in the performance of such duty, function, or
activity.
(d) External Appeal Determination Binding on Plan.--The determination
by an external appeal entity under this section is binding on the plan
involved in the determination.
(e) Penalties Against Authorized Officials for Refusing to Authorize
the Determination of an External Review Entity.--
(1) Monetary penalties.--In any case in which the
determination of an external review entity is not followed by a
qualified health benefits plan, any person who, acting in the
capacity of authorizing the benefit, causes such refusal may,
in the discretion in a court of competent jurisdiction, be
liable to an aggrieved participant, beneficiary, or enrollee
for a civil penalty in an amount of up to $1,000 a day from the
date on which the determination was transmitted to the plan by
the external review entity until the date the refusal to
provide the benefit is corrected.
(2) Cease and desist order and order of attorney's fees.--In
any action described in paragraph (1) brought by a participant,
beneficiary, or enrollee with respect to a qualified health
benefits plan, in which a plaintiff alleges that a person
referred to in such paragraph has taken an action resulting in
a refusal of a benefit determined by an external appeal entity
in violation of such terms of the plan, coverage, or this
subtitle, or has failed to take an action for which such person
is responsible under the plan or this title and which is
necessary under the plan or coverage for authorizing a benefit,
the court shall cause to be served on the defendant an order
requiring the defendant--
(A) to cease and desist from the alleged action or
failure to act; and
(B) to pay to the plaintiff a reasonable attorney's
fee and other reasonable costs relating to the
prosecution of the action on the charges on which the
plaintiff prevails.
(3) Additional civil penalties.--
(A) In general.--In addition to any penalty imposed
under paragraph (1) or (2), the appropriate Secretary
may assess a civil penalty against a person acting in
the capacity of authorizing a benefit determined by an
external review entity for one or more qualified health
benefits plans, for--
(i) any pattern or practice of repeated
refusal to authorize a benefit determined by an
external appeal entity in violation of the
terms of such a plan, or this title; or
(ii) any pattern or practice of repeated
violations of the requirements of this section
with respect to such plan or plans.
(B) Standard of proof and amount of penalty.--Such
penalty shall be payable only upon proof by clear and
convincing evidence of such pattern or practice and
shall be in an amount not to exceed the lesser of--
(i) 25 percent of the aggregate value of
benefits shown by the appropriate Secretary to
have not been provided, or unlawfully delayed,
in violation of this section under such pattern
or practice, or
(ii) $500,000.
(4) Removal and disqualification.--Any person acting in the
capacity of authorizing benefits who has engaged in any such
pattern or practice described in paragraph (3)(A) with respect
to a plan or coverage, upon the petition of the appropriate
Secretary, may be removed by the court from such position, and
from any other involvement, with respect to such a plan or
coverage, and may be precluded from returning to any such
position or involvement for a period determined by the court.
(f) Protection of Legal Rights.--Nothing in this subtitle shall be
construed as altering or eliminating any cause of action or legal
rights or remedies of participants, beneficiaries, enrollees, and
others under State or Federal law (including sections 502 and 503 of
the Employee Retirement Income Security Act of 1974), including the
right to file judicial actions to enforce actions.
(g) Application to All Acceptable Coverage.--The provisions of this
section shall apply with respect to all acceptable coverage in the same
manner as such provisions apply with respect to qualified health
benefits plans under this section.
Subtitle E--Governance
SEC. 141. HEALTH CHOICES ADMINISTRATION; HEALTH CHOICES COMMISSIONER.
(a) In General.--There is hereby established, as an independent
agency in the executive branch of the Government, a Health Choices
Administration (in this division referred to as the
``Administration'').
(b) Commissioner.--
(1) In general.--The Administration shall be headed by a
Health Choices Commissioner (in this division referred to as
the ``Commissioner'') who shall be appointed by the President,
by and with the advice and consent of the Senate.
(2) Compensation; etc.--The provisions of paragraphs (2),
(5), and (7) of subsection (a) (relating to compensation,
terms, general powers, rulemaking, and delegation) of section
702 of the Social Security Act (42 U.S.C. 902) shall apply to
the Commissioner and the Administration in the same manner as
such provisions apply to the Commissioner of Social Security
and the Social Security Administration.
SEC. 142. DUTIES AND AUTHORITY OF COMMISSIONER.
(a) Duties.--The Commissioner is responsible for carrying out the
following functions under this division:
(1) Qualified plan standards.--The establishment of qualified
health benefits plan standards under this title, including the
enforcement of such standards in coordination with State
insurance regulators and the Secretaries of Labor and the
Treasury.
(2) Health insurance exchange.--The establishment and
operation of a Health Insurance Exchange under subtitle A of
title II.
(3) Individual affordability credits.--The administration of
individual affordability credits under subtitle C of title II,
including determination of eligibility for such credits.
(4) Additional functions.--Such additional functions as may
be specified in this division.
(b) Promoting Accountability.--
(1) In general.--The Commissioner shall undertake activities
in accordance with this subtitle to promote accountability of
QHBP offering entities in meeting Federal health insurance
requirements, regardless of whether such accountability is with
respect to qualified health benefits plans offered through the
Health Insurance Exchange or outside of such Exchange.
(2) Compliance examination and audits.--
(A) In general.--The commissioner shall, in
coordination with States, conduct audits of qualified
health benefits plan compliance with Federal
requirements. Such audits may include random
compliance audits and targeted audits in response to
complaints or other suspected non-compliance.
(B) Recoupment of costs in connection with
examination and audits.--The Commissioner is authorized
to recoup from qualified health benefits plans
reimbursement for the costs of such examinations and
audit of such QHBP offering entities.
(c) Data Collection.--The Commissioner shall collect data for
purposes of carrying out the Commissioner's duties, including for
purposes of promoting quality and value, protecting consumers, and
addressing disparities in health and health care and may share such
data with the Secretary of Health and Human Services.
(d) Sanctions Authority.--
(1) In general.--In the case that the Commissioner determines
that a QHBP offering entity violates a requirement of this
title, the Commissioner may, in coordination with State
insurance regulators and the Secretary of Labor, provide, in
addition to any other remedies authorized by law, for any of
the remedies described in paragraph (2).
(2) Remedies.--The remedies described in this paragraph, with
respect to a qualified health benefits plan offered by a QHBP
offering entity, are--
(A) civil money penalties of not more than the amount
that would be applicable under similar circumstances
for similar violations under section 1857(g) of the
Social Security Act;
(B) suspension of enrollment of individuals under
such plan after the date the Commissioner notifies the
entity of a determination under paragraph (1) and until
the Commissioner is satisfied that the basis for such
determination has been corrected and is not likely to
recur;
(C) in the case of an Exchange-participating health
benefits plan, suspension of payment to the entity
under the Health Insurance Exchange for individuals
enrolled in such plan after the date the Commissioner
notifies the entity of a determination under paragraph
(1) and until the Secretary is satisfied that the basis
for such determination has been corrected and is not
likely to recur; or
(D) working with State insurance regulators to
terminate plans for repeated failure by the offering
entity to meet the requirements of this title.
(e) Standard Definitions of Insurance and Medical Terms.--The
Commissioner shall provide for the development of standards for the
definitions of terms used in health insurance coverage, including
insurance-related terms.
(f) Efficiency in Administration.--The Commissioner shall issue
regulations for the effective and efficient administration of the
Health Insurance Exchange and affordability credits under subtitle C,
including, with respect to the determination of eligibility for
affordability credits, the use of personnel who are employed in
accordance with the requirements of title 5, United States Code, to
carry out the duties of the Commissioner or, in the case of sections
208 and 241(b)(2), the use of State personnel who are employed in
accordance with standards prescribed by the Office of Personnel
Management pursuant to section 208 of the Intergovernmental Personnel
Act of 1970 (42 U.S.C. 4728).
SEC. 143. CONSULTATION AND COORDINATION.
(a) Consultation.--In carrying out the Commissioner's duties under
this division, the Commissioner, as appropriate, shall consult with at
least with the following:
(1) The National Association of Insurance Commissioners,
State attorneys general, and State insurance regulators,
including concerning the standards for insured qualified health
benefits plans under this title and enforcement of such
standards.
(2) Appropriate State agencies, specifically concerning the
administration of individual affordability credits under
subtitle C of title II and the offering of Exchange-
participating health benefits plans, to Medicaid eligible
individuals under subtitle A of such title.
(3) Other appropriate Federal agencies.
(4) Indian tribes and tribal organizations.
(5) The National Association of Insurance Commissioners for
purposes of using model guidelines established by such
association for purposes of subtitles B and D.
(b) Coordination.--
(1) In general.--In carrying out the functions of the
Commissioner, including with respect to the enforcement of the
provisions of this division, the Commissioner shall work in
coordination with existing Federal and State entities to the
maximum extent feasible consistent with this division and in a
manner that prevents conflicts of interest in duties and
ensures effective enforcement.
(2) Uniform standards.--The Commissioner, in coordination
with such entities, shall seek to achieve uniform standards
that adequately protect consumers in a manner that does not
unreasonably affect employers and insurers.
SEC. 144. HEALTH INSURANCE OMBUDSMAN.
(a) In General.--The Commissioner shall appoint within the Health
Choices Administration a Qualified Health Benefits Plan Ombudsman who
shall have expertise and experience in the fields of health care and
education of (and assistance to) individuals.
(b) Duties.--The Qualified Health Benefits Plan Ombudsman shall, in a
linguistically appropriate manner--
(1) receive complaints, grievances, and requests for
information submitted by individuals;
(2) provide assistance with respect to complaints,
grievances, and requests referred to in paragraph (1),
including--
(A) helping individuals determine the relevant
information needed to seek an appeal of a decision or
determination;
(B) assistance to such individuals with any problems
arising from disenrollment from such a plan;
(C) assistance to such individuals in choosing a
qualified health benefits plan in which to enroll; and
(D) assistance to such individuals in presenting
information under subtitle C (relating to affordability
credits); and
(3) submit annual reports to Congress and the Commissioner
that describe the activities of the Ombudsman and that include
such recommendations for improvement in the administration of
this division as the Ombudsman determines appropriate. The
Ombudsman shall not serve as an advocate for any increases in
payments or new coverage of services, but may identify issues
and problems in payment or coverage policies.
Subtitle F--Relation to Other Requirements; Miscellaneous
SEC. 151. RELATION TO OTHER REQUIREMENTS.
(a) Coverage Not Offered Through Exchange.--
(1) In general.--In the case of health insurance coverage not
offered through the Health Insurance Exchange (whether or not
offered in connection with an employment-based health plan),
and in the case of employment-based health plans, the
requirements of this title do not supercede any requirements
applicable under titles XXII and XXVII of the Public Health
Service Act, parts 6 and 7 of subtitle B of title I of the
Employee Retirement Income Security Act of 1974, or State law,
except insofar as such requirements prevent the application of
a requirement of this division, as determined by the
Commissioner.
(2) Construction.--Nothing in paragraph (1) shall be
construed as affecting the application of section 514 of the
Employee Retirement Income Security Act of 1974.
(b) Coverage Offered Through Exchange.--
(1) In general.--In the case of health insurance coverage
offered through the Health Insurance Exchange--
(A) the requirements of this title do not supercede
any requirements (including requirements relating to
genetic information nondiscrimination and mental
health) applicable under title XXVII of the Public
Health Service Act or under State law, except insofar
as such requirements prevent the application of a
requirement of this division, as determined by the
Commissioner; and
(B) individual rights and remedies under State laws
shall apply.
(2) Construction.--In the case of coverage described in
paragraph (1), nothing in such paragraph shall be construed as
preventing the application of rights and remedies under State
laws with respect to any requirement referred to in paragraph
(1)(A).
SEC. 152. PROHIBITING DISCRIMINATION IN HEALTH CARE.
(a) In General.--Except as otherwise explicitly permitted by this Act
and by subsequent regulations consistent with this Act, all health care
and related services (including insurance coverage and public health
activities) covered by this Act shall be provided without regard to
personal characteristics extraneous to the provision of high quality
health care or related services.
(b) Implementation.--To implement the requirement set forth in
subsection (a), the Secretary of Health and Human Services shall, not
later than 18 months after the date of the enactment of this Act,
promulgate such regulations as are necessary or appropriate to insure
that all health care and related services (including insurance coverage
and public health activities) covered by this Act are provided (whether
directly or through contractual, licensing, or other arrangements)
without regard to personal characteristics extraneous to the provision
of high quality health care or related services.
SEC. 153. WHISTLEBLOWER PROTECTION.
(a) Retaliation Prohibited.--No employer may discharge any employee
or otherwise discriminate against any employee with respect to his
compensation, terms, conditions, or other privileges of employment
because the employee (or any person acting pursuant to a request of the
employee)--
(1) provided, caused to be provided, or is about to provide
or cause to be provided to the employer, the Federal
Government, or the attorney general of a State information
relating to any violation of, or any act or omission the
employee reasonably believes to be a violation of any provision
of this Act or any order, rule, or regulation promulgated under
this Act;
(2) testified or is about to testify in a proceeding
concerning such violation;
(3) assisted or participated or is about to assist or
participate in such a proceeding; or
(4) objected to, or refused to participate in, any activity,
policy, practice, or assigned task that the employee (or other
such person) reasonably believed to be in violation of any
provision of this Act or any order, rule, or regulation
promulgated under this Act.
(b) Enforcement Action.--An employee covered by this section who
alleges discrimination by an employer in violation of subsection (a)
may bring an action governed by the rules, procedures, legal burdens of
proof, and remedies set forth in section 40(b) of the Consumer Product
Safety Act (15 U.S.C. 2087(b)).
(c) Employer Defined.--As used in this section, the term ``employer''
means any person (including one or more individuals, partnerships,
associations, corporations, trusts, professional membership
organization including a certification, disciplinary, or other
professional body, unincorporated organizations, nongovernmental
organizations, or trustees) engaged in profit or nonprofit business or
industry whose activities are governed by this Act, and any agent,
contractor, subcontractor, grantee, or consultant of such person.
(d) Rule of Construction.--The rule of construction set forth in
section 20109(h) of title 49, United States Code, shall also apply to
this section.
SEC. 154. CONSTRUCTION REGARDING COLLECTIVE BARGAINING.
Nothing in this division shall be construed to alter of supercede any
statutory or other obligation to engage in collective bargaining over
the terms and conditions of employment related to health care.
SEC. 155. SEVERABILITY.
If any provision of this Act, or any application of such provision to
any person or circumstance, is held to be unconstitutional, the
remainder of the provisions of this Act and the application of the
provision to any other person or circumstance shall not be affected.
SEC. 156. APPLICATION OF STATE AND FEDERAL LAWS REGARDING ABORTION.
(a) No Preemption of State Laws Regarding Abortion.--Nothing in this
Act shall be construed to preempt or otherwise have any effect on State
laws regarding the prohibition of (or requirement of) coverage,
funding, or procedural requirements on abortions, including parental
notification or consent for the performance of an abortion on a minor.
(b) No Effect on Federal Laws Regarding Abortion.--
(1) In general.--Nothing in this Act shall be construed to
have any effect on Federal laws regarding--
(A) conscience protection;
(B) willingness or refusal to provide abortion; and
(C) discrimination on the basis of the willingness or
refusal to provide, pay for, cover, or refer for
abortion or to provide or participate in training to
provide abortion.
(c) No Effect on Federal Civil Rights Law.--Nothing in this section
shall alter the rights and obligations of employees and employers under
title VII of the Civil Rights Act of 1964.
SEC. 157. NON-DISCRIMINATION ON ABORTION AND RESPECT FOR RIGHTS OF
CONSCIENCE.
(a) Non-discrimination.--A Federal agency or program, and any State
or local government that receives Federal financial assistance under
this Act (or an amendment made by this Act), may not--
(1) subject any individual or institutional health care
entity to discrimination, or
(2) require any health plan created or regulated under this
Act (or an amendment made by this Act) to subject any
individual or institutional health care entity to
discrimination,
on the basis that the health care entity does not provide, pay for,
provide coverage of, or refer for abortions.
(b) Definition.--In this section, the term ``health care entity''
includes an individual physician or other health care professional, a
hospital, a provider-sponsored organization, a health maintenance
organization, a health insurance plan, or any other kind of health care
facility, organization, or plan.
(c) Administration.--The Office for Civil Rights of the Department of
Health and Human Services is designated to receive complaints of
discrimination based on this section, and coordinate the investigation
of such complaints.
Subtitle G--Early Investments
SEC. 161. ENSURING VALUE AND LOWER PREMIUMS.
(a) Group Health Insurance Coverage.--Title XXVII of the Public
Health Service Act is amended by inserting after section 2713 the
following new section:
``SEC. 2714. ENSURING VALUE AND LOWER PREMIUMS.
``(a) In General.--Each health insurance issuer that offers health
insurance coverage in the small or large group market shall provide
that for any plan year in which the coverage has a medical loss ratio
below a level specified by the Secretary, the issuer shall provide in a
manner specified by the Secretary for rebates to enrollees of payment
sufficient to meet such loss ratio. Such methodology shall be set at
the highest level medical loss ratio possible that is designed to
ensure adequate participation by issuers, competition in the health
insurance market, and value for consumers so that their premiums are
used for services.
``(b) Uniform Definitions.--The Secretary shall establish a uniform
definition of medical loss ratio and methodology for determining how to
calculate the medical loss ratio. Such methodology shall be designed to
take into account the special circumstances of smaller plans, different
types of plans, and newer plans.''.
(b) Individual Health Insurance Coverage.--Such title is further
amended by inserting after section 2753 the following new section:
``SEC. 2754. ENSURING VALUE AND LOWER PREMIUMS.
``The provisions of section 2714 shall apply to health insurance
coverage offered in the individual market in the same manner as such
provisions apply to health insurance coverage offered in the small or
large group market.''.
(c) Immediate Implementation.--The amendments made by this section
shall apply in the group and individual market for plan years beginning
on or after January 1, 2011.
SEC. 162. ENDING HEALTH INSURANCE RESCISSION ABUSE.
(a) Clarification Regarding Application of Guaranteed Renewability of
Individual Health Insurance Coverage.--Section 2742 of the Public
Health Service Act (42 U.S.C. 300gg-42) is amended--
(1) in its heading, by inserting ``AND CONTINUATION IN FORCE,
INCLUDING PROHIBITION OF RESCISSION,'' after ``GUARANTEED
RENEWABILITY''; and
(2) in subsection (a), by inserting ``, including without
rescission,'' after ``continue in force''.
(b) Secretarial Guidance Regarding Rescissions.--Section 2742 of such
Act (42 U.S.C. 300gg-42) is amended by adding at the end the following:
``(f) Rescission.--A health insurance issuer may rescind health
insurance coverage only upon clear and convincing evidence of fraud
described in subsection (b)(2). The Secretary, no later than July 1,
2010, shall issue guidance implementing this requirement, including
procedures for independent, external third party review.''.
(c) Opportunity for Independent, External Third Party Review in
Certain Cases.--Subpart 1 of part B of title XXVII of such Act (42
U.S.C. 300gg-41 et seq.) is amended by adding at the end the following:
``SEC. 2746. OPPORTUNITY FOR INDEPENDENT, EXTERNAL THIRD PARTY REVIEW
IN CASES OF RESCISSION.
``(a) Notice and Review Right.--If a health insurance issuer
determines to rescind health insurance coverage for an individual in
the individual market, before such rescission may take effect the
issuer shall provide the individual with notice of such proposed
rescission and an opportunity for a review of such determination by an
independent, external third party under procedures specified by the
Secretary under section 2742(f).
``(b) Independent Determination.--If the individual requests such
review by an independent, external third party of a rescission of
health insurance coverage, the coverage shall remain in effect until
such third party determines that the coverage may be rescinded under
the guidance issued by the Secretary under section 2742(f).''.
(d) Effective Date.--The amendments made by this section shall apply
on and after October 1, 2010, with respect to health insurance coverage
issued before, on, or after such date.
SEC. 163. ENDING HEALTH INSURANCE DENIALS AND DELAYS OF NECESSARY
TREATMENT FOR CHILDREN WITH DEFORMITIES.
(a) In General.--Subpart 2 of part A of title XXVII of the Public
Health Service Act is amended by adding at the end the following new
section:
``SEC. 2708. STANDARDS RELATING TO BENEFITS FOR MINOR CHILD'S
CONGENITAL OR DEVELOPMENTAL DEFORMITY OR DISORDER.
``(a) Requirements for Treatment for Children With Deformities.--
``(1) In general.--A group health plan, and a health
insurance issuer offering group health insurance coverage, that
provides coverage for surgical benefits shall provide coverage
for outpatient and inpatient diagnosis and treatment of a minor
child's congenital or developmental deformity, disease, or
injury. A minor child shall include any individual who 21 years
of age or younger.
``(2) Requirements.--Any coverage provided under paragraph
(1) shall be subject to pre-authorization or pre-certification
as required by the plan or issuer, and such coverage shall
include any surgical treatment which, in the opinion of the
treating physician, is medically necessary to approximate a
normal appearance.
``(3) Treatment defined.--
``(A) In general.--In this section, the term
`treatment' includes reconstructive surgical procedures
(procedures that are generally performed to improve
function, but may also be performed to approximate a
normal appearance) that are performed on abnormal
structures of the body caused by congenital defects,
developmental abnormalities, trauma, infection, tumors,
or disease, including--
``(i) procedures that do not materially
affect the function of the body part being
treated; and
``(ii) procedures for secondary conditions
and follow-up treatment.
``(B) Exception.--Such term does not include cosmetic
surgery performed to reshape normal structures of the
body to improve appearance or self-esteem.
``(b) Notice.--A group health plan under this part shall comply with
the notice requirement under section 714(b) of the Employee Retirement
Income Security Act of 1974 with respect to the requirements of this
section as if such section applied to such plan.''.
(b) Individual Health Insurance.--Subpart 2 of part B of title XXVII
of the Public Health Service Act, as amended by section 161(b), is
further amended by adding at the end the following new section:
``SEC. 2755. STANDARDS RELATING TO BENEFITS FOR MINOR CHILD'S
CONGENITAL OR DEVELOPMENTAL DEFORMITY OR DISORDER.
``(a) Requirements for Reconstructive Surgery.--
``(1) In general.--A health insurance issuer offering health
insurance coverage in the individual market that provides
coverage for surgical benefits shall provide coverage for
outpatient and inpatient diagnosis and treatment of a minor
child's congenital or developmental deformity, disease, or
injury. A minor child shall include any individual through 21
years of age.
``(2) Requirements.--Any coverage provided under paragraph
(1) shall be subject to pre-authorization or pre-certification
as required by the insurance issuer offering such coverage, and
such coverage shall include any surgical treatment which, in
the opinion of the treating physician, is medically necessary
to approximate a normal appearance.
``(3) Treatment defined.--
``(A) In general.--In this section, the term
`treatment' includes reconstructive surgical procedures
(procedures that are generally performed to improve
function, but may also be performed to approximate a
normal appearance) that are performed on abnormal
structures of the body caused by congenital defects,
developmental abnormalities, trauma, infection, tumors,
or disease, including--
``(i) procedures that do not materially
affect the function of the body part being
treated; and
``(ii) procedures for secondary conditions
and follow-up treatment.
``(B) Exception.--Such term does not include cosmetic
surgery performed to reshape normal structures of the
body to improve appearance or self-esteem.
``(b) Notice.--A health insurance issuer under this part shall comply
with the notice requirement under section 714(b) of the Employee
Retirement Income Security Act of 1974 with respect to the requirements
referred to in subsection (a) as if such section applied to such issuer
and such issuer were a group health plan.''.
(c) Conforming Amendments.--
(1) Section 2723(c) of such Act (42 U.S.C. 300gg-23(c)) is
amended by striking ``section 2704'' and inserting ``sections
2704 and 2708''.
(2) Section 2762(b)(2) of such Act (42 U.S.C. 300gg-62(b)(2))
is amended by striking ``section 2751'' and inserting
``sections 2751 and 2754''.
(d) Effective Dates.--
(1) The amendments made by subsection (a) shall apply with
respect to group health plans for plan years beginning on or
after January 1, 2010.
(2) The amendment made by subsection (b) shall apply with
respect to health insurance coverage offered, sold, issued,
renewed, in effect, or operated in the individual market on or
after such date.
(e) Coordination Rules.--
(1) The amendments made by subsection (a) shall remain in
effect until such time as benefit standards are adopted subject
to section 124 of this title.
(2) Section 104(1) of the Health Insurance Portability and
Accountability Act of 1996 is amended by striking ``this
subtitle (and the amendments made by this subtitle and section
401)'' and inserting ``the provisions of part 7 of subtitle B
of title I of the Employee Retirement Income Security Act of
1974, the provisions of parts A and C of title XXVII of the
Public Health Service Act, and chapter 100 of the Internal
Revenue Code of 1986''.
SEC. 164. ADMINISTRATIVE SIMPLIFICATION.
(a) Standardizing Electronic Administrative Transactions.--
(1) In general.--Part C of title XI of the Social Security
Act (42 U.S.C. 1320d et seq.) is amended by inserting after
section 1173 the following new sections:
``SEC. 1173A. STANDARDIZE ELECTRONIC ADMINISTRATIVE TRANSACTIONS.
``(a) Standards for Financial and Administrative Transactions.--
``(1) In general.--The Secretary shall adopt and regularly
update standards consistent with the goals described in
paragraph (2).
``(2) Goals for financial and administrative transactions.--
The goals for standards under paragraph (1) are that such
standards shall--
``(A) be unique with no conflicting or redundant
standards;
``(B) be authoritative, permitting no additions or
constraints for electronic transactions, including
companion guides;
``(C) be comprehensive, efficient and robust,
requiring minimal augmentation by paper transactions or
clarification by further communications;
``(D) enable the real-time (or near real-time)
determination of an individual's financial
responsibility at the point of service and, to the
extent possible, prior to service, including whether
the individual is eligible for a specific service with
a specific physician at a specific facility, which may
include utilization of a machine-readable health plan
beneficiary identification card;
``(E) enable, where feasible, near real-time
adjudication of claims;
``(F) provide for timely acknowledgment, response,
and status reporting applicable to any electronic
transaction deemed appropriate by the Secretary;
``(G) describe all data elements (such as reason and
remark codes) in unambiguous terms, not permit optional
fields, require that data elements be either required
or conditioned upon set values in other fields, and
prohibit additional conditions; and
``(H) harmonize all common data elements across
administrative and clinical transaction standards.
``(3) Time for adoption.--Not later than 2 years after the
date of implementation of the X12 Version 5010 transaction
standards implemented under this part, the Secretary shall
adopt standards under this section.
``(4) Requirements for specific standards.--The standards
under this section shall be developed, adopted, and enforced so
as to--
``(A) clarify, refine, complete, and expand, as
needed, the standards required under section 1173;
``(B) require paper versions of standardized
transactions to comply with the same standards as to
data content such that a fully compliant, equivalent
electronic transaction can be populated from the data
from a paper version;
``(C) enable electronic funds transfers, in order to
allow automated reconciliation with the related health
care payment and remittance advice;
``(D) require timely and transparent claim and denial
management processes, including tracking, adjudication,
and appeal processing;
``(E) require the use of a standard electronic
transaction with which health care providers may
quickly and efficiently enroll with a health plan to
conduct the other electronic transactions provided for
in this part; and
``(F) provide for other requirements relating to
administrative simplification as identified by the
Secretary, in consultation with stakeholders.
``(5) Building on existing standards.--In developing the
standards under this section, the Secretary shall build upon
existing and planned standards.
``(6) Implementation and enforcement.--Not later than 6
months after the date of the enactment of this section, the
Secretary shall submit to the appropriate committees of
Congress a plan for the implementation and enforcement, by not
later than 5 years after such date of enactment, of the
standards under this section. Such plan shall include--
``(A) a process and timeframe with milestones for
developing the complete set of standards;
``(B) an expedited upgrade program for continually
developing and approving additions and modifications to
the standards as often as annually to improve their
quality and extend their functionality to meet evolving
requirements in health care;
``(C) programs to provide incentives for, and ease
the burden of, implementation for certain health care
providers, with special consideration given to such
providers serving rural or underserved areas and ensure
coordination with standards, implementation
specifications, and certification criteria being
adopted under the HITECH Act;
``(D) programs to provide incentives for, and ease
the burden of, health care providers who volunteer to
participate in the process of setting standards for
electronic transactions;
``(E) an estimate of total funds needed to ensure
timely completion of the implementation plan; and
``(F) an enforcement process that includes timely
investigation of complaints, random audits to ensure
compliance, civil monetary and programmatic penalties
for non-compliance consistent with existing laws and
regulations, and a fair and reasonable appeals process
building off of enforcement provisions under this part.
``(b) Limitations on Use of Data.--Nothing in this section shall be
construed to permit the use of information collected under this section
in a manner that would adversely affect any individual.
``(c) Protection of Data.--The Secretary shall ensure (through the
promulgation of regulations or otherwise) that all data collected
pursuant to subsection (a) are--
``(1) used and disclosed in a manner that meets the HIPAA
privacy and security law (as defined in section 3009(a)(2) of
the Public Health Service Act), including any privacy or
security standard adopted under section 3004 of such Act; and
``(2) protected from all inappropriate internal use by any
entity that collects, stores, or receives the data, including
use of such data in determinations of eligibility (or continued
eligibility) in health plans, and from other inappropriate
uses, as defined by the Secretary.
``SEC. 1173B. OPERATING RULES.
``(a) In General.--The Secretary shall adopt operating rules for each
transaction described in section 1173(a)(2) of the Social Security Act
(42 U.S.C. 1320d-2(a))
``(b) Operating Rules Development.--In adopting such rules, the
Secretary shall take into account the development of operating rules
that have been developed by a nonprofit entity that meets the following
criteria:
``(1) The entity focuses its mission on administrative
simplification.
``(2) The entity demonstrates a established multi-stakeholder
process that creates consensus based operating rules using a
voting policy with balanced representation by the critical
stakeholders (including health plans and health care providers)
so that no one group dominates the entity and shall include
others such as standards development organizations, and
relevant Federal agencies.
``(3) The entity has in place a public set of guiding
principles that ensure the operating rules and process are open
and transparent.
``(4) The entity shall coordinate its activities with the HIT
Policy Committee and the HIT Standards Committee (established
under title XXX of the Public Health Service Act) and
complements the efforts of the Office of the National
Healthcare Coordinator and its related health information
exchange goals.
``(5) The entity incorporates national standards, including
the transaction standards issued under Health Insurance
Portability and Accountability Act of 1996.
``(6) The entity uses existing market research and proven
best practices.
``(7) The entity has a set of measures that allow for the
evaluation of their market impact and public reporting of
aggregate stakeholder impact.
``(8) The entity supports nondiscrimination and conflict of
interest policies that demonstrate a commitment to open, fair,
and nondiscriminatory practices.
``(9) The entity allows for public reviews and updates of the
operating rules.
``(c) Implementation.--The Secretary shall adopt operating rules
under this section, by regulation or otherwise, only after taking into
account the rules developed by the entity under subsection (b) and
having ensured consultation with providers. The first set of operating
rules for the transactions for eligibility for health plan and health
claims status under this section shall be adopted not later than
October 1, 2011, in a manner such that such set of rules is effective
beginning not later than January 1, 2013. The second set of operating
rules for the remainder of the transactions described in section
1173(a)(2) of the Social Security Act (42 U.S.C. 1320d-2(a)) shall be
adopted not later than October 1, 2012, in a manner such that such set
of rules is effective beginning not later than January 1, 2014.''.
(2) Definitions.--Section 1171 of such Act (42 U.S.C. 1320d)
is amended--
(A) in paragraph (7), by striking ``with reference
to'' and all that follows and inserting ``with
reference to a transaction or data element of health
information in section 1173 means implementation
specifications, certification criteria, operating
rules, messaging formats, codes, and code sets adopted
or established by the Secretary for the electronic
exchange and use of information.''; and
(B) by adding at the end the following new paragraph:
``(9) Operating rules.--The term `operating rules' means
business rules for using and processing transactions. Operating
rules should address the following:
``(A) Requirements for data content using available
and established national standards.
``(B) Infrastructure requirements that establish best
practices for streamlining data flow to yield timely
execution of transactions.
``(C) Policies defining the transaction related
rights and responsibilities for entities that are
transmitting or receiving data.''.
(3) Conforming amendment.--Section 1179 of such Act (42
U.S.C. 1320d-8) is amended, in the matter before paragraph
(1)--
(A) by inserting ``on behalf of an individual'' after
``1978)''; and
(B) by inserting ``on behalf of an individual'' after
``for a financial institution''.
(b) Standards for Claims Attachments and Coordination of Benefits .--
(1) Standard for health claims attachments.--Not later than 1
year after the date of the enactment of this Act, the Secretary
of Health and Human Services shall promulgate a final rule to
establish a standard for health claims attachment transaction
described in section 1173(a)(2)(B) of the Social Security Act
(42 U.S.C. 1320d-2(a)(2)(B)) and coordination of benefits.
(2) Revision in processing payment transactions by financial
institutions.--
(A) In general.--Section 1179 of the Social Security
Act (42 U.S.C. 1320d-8) is amended, in the matter
before paragraph (1)--
(i) by striking ``or is engaged'' and
inserting ``and is engaged''; and
(ii) by inserting ``(other than as a business
associate for a covered entity)'' after ``for a
financial institution''.
(B) Effective date.--The amendments made by paragraph
(1) shall apply to transactions occurring on or after
such date (not later than 6 months after the date of
the enactment of this Act) as the Secretary of Health
and Human Services shall specify.
(c) Unique Health Plan Identifier.--Not later than 2 years after the
date of the enactment of this Act, the Secretary of Health and Human
Services shall promulgate a final rule to establish a unique health
plan identifier described in section 1173(b) of the Social Security Act
(42 U.S.C. 1320d-2(b)) based on the input of the National Committee of
Vital and Health Statistics and consultation with health plans. The
Secretary may do so on an interim final basis and effective not later
than October 1, 2012.
SEC. 165. EXPANSION OF ELECTRONIC TRANSACTIONS IN MEDICARE.
(a) In General.--Section 1862(a) of the Social Security Act (42
U.S.C. 1395y(a)) is amended--
(1) in paragraph (23), by striking the ``or'' at the end;
(2) in paragraph (24), by striking the period and inserting
``; or''; and
(3) by inserting after paragraph (24) the following new
paragraph:
``(25) subject to subsection (h), not later than January 1,
2015, for which the payment is other than by electronic funds
transfer (EFT) or an electronic remittance in a form as
specified in ASC X12 835 Health Care Payment and Remittance
Advice or subsequent standard.''.
(b) Effective Date.--The amendments made by subsection (a) shall take
effect upon the date of the enactment of this Act.
SEC. 166. REINSURANCE PROGRAM FOR RETIREES.
(a) Establishment.--
(1) In general.--Not later than 90 days after the date of the
enactment of this Act, the Secretary of Health and Human
Services shall establish a temporary reinsurance program (in
this section referred to as the ``reinsurance program'') to
provide reimbursement to assist participating employment-based
plans with the cost of providing health benefits to retirees
and to eligible spouses, surviving spouses and dependents of
such retirees.
(2) Definitions.--For purposes of this section:
(A) The term ``eligible employment-based plan'' means
a group health benefits plan that--
(i) is maintained by one or more employers,
former employers or employee associations, or a
voluntary employees' beneficiary association,
or a committee or board of individuals
appointed to administer such plan, and
(ii) provides health benefits to retirees.
(B) The term ``health benefits'' means medical,
surgical, hospital, prescription drug, and such other
benefits as shall be determined by the Secretary,
whether self-funded or delivered through the purchase
of insurance or otherwise.
(C) The term ``participating employment-based plan''
means an eligible employment-based plan that is
participating in the reinsurance program.
(D) The term ``retiree'' means, with respect to a
participating employment-benefit plan, an individual
who--
(i) is 55 years of age or older;
(ii) is not eligible for coverage under title
XVIII of the Social Security Act; and
(iii) is not an active employee of an
employer maintaining the plan or of any
employer that makes or has made substantial
contributions to fund such plan.
(E) The term ``Secretary'' means Secretary of Health
and Human Services.
(b) Participation.--To be eligible to participate in the reinsurance
program, an eligible employment-based plan shall submit to the
Secretary an application for participation in the program, at such
time, in such manner, and containing such information as the Secretary
shall require.
(c) Payment.--
(1) Submission of claims.--
(A) In general.--Under the reinsurance program, a
participating employment-based plan shall submit claims
for reimbursement to the Secretary which shall contain
documentation of the actual costs of the items and
services for which each claim is being submitted.
(B) Basis for claims.--Each claim submitted under
subparagraph (A) shall be based on the actual amount
expended by the participating employment-based plan
involved within the plan year for the appropriate
employment based health benefits provided to a retiree
or to the spouse, surviving spouse, or dependent of a
retiree. In determining the amount of any claim for
purposes of this subsection, the participating
employment-based plan shall take into account any
negotiated price concessions (such as discounts, direct
or indirect subsidies, rebates, and direct or indirect
remunerations) obtained by such plan with respect to
such health benefits. For purposes of calculating the
amount of any claim, the costs paid by the retiree or
by the spouse, surviving spouse, or dependent of the
retiree in the form of deductibles, co-payments, and
co-insurance shall be included along with the amounts
paid by the participating employment-based plan.
(2) Program payments and limit.--If the Secretary determines
that a participating employment-based plan has submitted a
valid claim under paragraph (1), the Secretary shall reimburse
such plan for 80 percent of that portion of the costs
attributable to such claim that exceeds $15,000, but is less
than $90,000. Such amounts shall be adjusted each year based on
the percentage increase in the medical care component of the
Consumer Price Index (rounded to the nearest multiple of
$1,000) for the year involved.
(3) Use of payments.--Amounts paid to a participating
employment-based plan under this subsection shall be used to
lower the costs borne directly by the participants and
beneficiaries for health benefits provided under such plan in
the form of premiums, co-payments, deductibles, co-insurance,
or other out-of-pocket costs. Such payments shall not be used
to reduce the costs of an employer maintaining the
participating employment-based plan. The Secretary shall
develop a mechanism to monitor the appropriate use of such
payments by such plans.
(4) Appeals and program protections.--The Secretary shall
establish--
(A) an appeals process to permit participating
employment-based plans to appeal a determination of the
Secretary with respect to claims submitted under this
section; and
(B) procedures to protect against fraud, waste, and
abuse under the program.
(5) Audits.--The Secretary shall conduct annual audits of
claims data submitted by participating employment-based plans
under this section to ensure that they are in compliance with
the requirements of this section.
(d) Retiree Reserve Trust Fund.--
(1) Establishment.--
(A) In general.--There is established in the Treasury
of the United States a trust fund to be known as the
``Retiree Reserve Trust Fund'' (referred to in this
section as the ``Trust Fund''), that shall consist of
such amounts as may be appropriated or credited to the
Trust Fund as provided for in this subsection to enable
the Secretary to carry out the reinsurance program.
Such amounts shall remain available until expended.
(B) Funding.--There are hereby appropriated to the
Trust Fund, out of any moneys in the Treasury not
otherwise appropriated, an amount requested by the
Secretary as necessary to carry out this section,
except that the total of all such amounts requested
shall not exceed $10,000,000,000.
(C) Appropriations from the trust fund.--
(i) In general.--Amounts in the Trust Fund
are appropriated to provide funding to carry
out the reinsurance program and shall be used
to carry out such program.
(ii) Budgetary implications.--Amounts
appropriated under clause (i), and outlays
flowing from such appropriations, shall not be
taken into account for purposes of any budget
enforcement procedures including allocations
under section 302(a) and (b) of the Balanced
Budget and Emergency Deficit Control Act and
budget resolutions for fiscal years during
which appropriations are made from the Trust
Fund.
(iii) Limitation to available funds.--The
Secretary has the authority to stop taking
applications for participation in the program
or take such other steps in reducing
expenditures under the reinsurance program in
order to ensure that expenditures under the
reinsurance program do not exceed the funds
available under this subsection.
SEC. 167. LIMITATIONS ON PREEXISTING CONDITION EXCLUSIONS IN GROUP
HEALTH PLANS AND HEALTH INSURANCE COVERAGE IN THE
GROUP AND INDIVIDUAL MARKETS IN ADVANCE OF
APPLICABILITY OF NEW PROHIBITION OF PREEXISTING
CONDITION EXCLUSIONS.
(a) Amendments Relating to Preexisting Condition Exclusions Under
Group Health Plans.--
(1) Reduction in look-back period.--Section 2701(a)(1) of the
Public Health Service Act (42 U.S.C. 300gg(a)(1)) is amended by
striking ``6-month period'' and inserting ``30-day period''.
(2) Reduction in permitted preexisting condition limitation
period.--Section 2701(a)(2) of such Act (42 U.S.C. 300gg(a)(2))
is amended by striking ``12 months'' and inserting ``3
months'', and by striking ``18 months'' and inserting ``9
months''.
(3) Effective date.--
(A) In general.--Except as provided in subparagraph
(B), the amendments made by this subsection shall apply
with respect to group health plans for plan years
beginning after the end of the 6th calendar month
following the date of the enactment of this Act.
(B) Special rule for collective bargaining
agreements.--In the case of a group health plan
maintained pursuant to one or more collective
bargaining agreements between employee representatives
and one or more employers ratified before the date of
the enactment of this Act, the amendments made by this
subsection shall not apply to plan years beginning
before the earlier of--
(i) the date on which the last of the
collective bargaining agreements relating to
the plan terminates (determined without regard
to any extension thereof agreed to after the
date of the enactment of this Act), or
(ii) 3 years after the date of the enactment
of this Act.
For purposes of clause (i), any plan amendment made
pursuant to a collective bargaining agreement relating
to the plan which amends the plan solely to conform to
any requirement added by the amendments made by this
section shall not be treated as a termination of such
collective bargaining agreement.
(b) Amendments Relating to Preexisting Condition Exclusions in Health
Insurance Coverage in the Individual Market Under Grandfathered Health
Insurance Coverage.--
(1) Applicability of group health insurance limitations on
imposition of preexisting condition exclusions.--
(A) In general.--Section 2741 of the Public Health
Service Act (42 U.S.C. 300gg-41) is amended--
(i) by redesignating the second subsection
(e) (relating to market requirements) and
subsection (f) as subsections (f) and (g),
respectively; and
(ii) by adding at the end the following new
subsection:
``(h) Application of Group Health Insurance Limitations on Imposition
of Preexisting Condition Exclusions.--
``(1) In general.--Subject to paragraph (2), a health
insurance issuer that provides individual health insurance
coverage may not impose a preexisting condition exclusion (as
defined in subsection (b)(1)(A) of section 2701) with respect
to such coverage except to the extent that such exclusion could
be imposed consistent with such section if such coverage were
group health insurance coverage.
``(2) Limitation.--In the case of an individual who--
``(A) is enrolled in individual health insurance
coverage;
``(B) during the period of such enrollment has a
condition for which no medical advice, diagnosis, care,
or treatment had been recommended or received as of the
enrollment date; and
``(C) seeks to enroll under other individual health
insurance coverage which provides benefits different
from those provided under the coverage referred to in
subparagraph (A) with respect to such condition,
the issuer of the individual health insurance coverage
described in subparagraph (C) may impose a preexisting
condition exclusion with respect to such condition and any
benefits in addition to those provided under the coverage
referred to in subparagraph (A), but such exclusion may not
extend for a period of more than 3 months.''.
(B) Elimination of cobra requirement.--Subsection (b)
of such section is amended--
(i) by adding ``and'' at the end of paragraph
(2);
(ii) by striking the semicolon at the end of
paragraph (3) and inserting a period; and
(iii) by striking paragraphs (4) and (5).
(C) Conforming amendment.--Section 2744(a)(1) of such
Act (42 U.S.C. 300gg-44(a)(1)) is amended by inserting
``(other than subsection (h))'' after ``section 2741''.
(2) Effective date.--The amendments made by this subsection
shall apply with respect to health insurance coverage offered,
sold, issued, renewed, in effect, or operated in the individual
market beginning after the end of the 6th calendar month
following the date of the enactment of this Act.
(c) Inapplicability of Interim Limitations Upon Applicability of
Total Prohibition of Exclusion.--Section 2701 of such Act and the
amendments made by subsection (b) of this section to sections 2741 and
2744 of such Act shall cease to be effective in the case of any health
benefits plan as of the date on which such plan becomes subject to the
requirements of section 111 of this Act (relating to prohibiting
preexisting condition exclusions).
TITLE II--HEALTH INSURANCE EXCHANGE AND RELATED PROVISIONS
Subtitle A--Health Insurance Exchange
SEC. 201. ESTABLISHMENT OF HEALTH INSURANCE EXCHANGE; OUTLINE OF
DUTIES; DEFINITIONS.
(a) Establishment.--There is established within the Health Choices
Administration and under the direction of the Commissioner a Health
Insurance Exchange in order to facilitate access of individuals and
employers, through a transparent process, to a variety of choices of
affordable, quality health insurance coverage, including a public
health insurance option.
(b) Outline of Duties of Commissioner.--In accordance with this
subtitle and in coordination with appropriate Federal and State
officials as provided under section 143(b), the Commissioner shall--
(1) under section 204 establish standards for, accept bids
from, and negotiate and enter into contracts with, QHBP
offering entities for the offering of health benefits plans
through the Health Insurance Exchange, with different levels of
benefits required under section 203, and including with respect
to oversight and enforcement;
(2) under section 205 facilitate outreach and enrollment in
such plans of Exchange-eligible individuals and employers
described in section 202; and
(3) conduct such activities related to the Health Insurance
Exchange as required, including establishment of a risk pooling
mechanism under section 206 and consumer protections under
subtitle D of title I.
(c) Exchange-participating Health Benefits Plan Defined.--In this
division, the term ``Exchange-participating health benefits plan''
means a qualified health benefits plan that is offered through the
Health Insurance Exchange.
SEC. 202. EXCHANGE-ELIGIBLE INDIVIDUALS AND EMPLOYERS.
(a) Access to Coverage.--Except as provided in subsection (i) and in
accordance with this section, all individuals are eligible to obtain
coverage through enrollment in an Exchange-participating health
benefits plan offered through the Health Insurance Exchange unless such
individuals are enrolled in another qualified health benefits plan or
other acceptable coverage.
(b) Definitions.--In this division:
(1) Exchange-eligible individual.--The term ``Exchange-
eligible individual'' means an individual who is eligible under
this section to be enrolled through the Health Insurance
Exchange in an Exchange-participating health benefits plan and,
with respect to family coverage, includes dependents of such
individual.
(2) Exchange-eligible employer.--The term ``Exchange-eligible
employer'' means an employer that is eligible under this
section to enroll through the Health Insurance Exchange
employees of the employer (and their dependents) in Exchange-
eligible health benefits plans.
(3) Employment-related definitions.--The terms ``employer'',
``employee'', ``full-time employee'', and ``part-time
employee'' have the meanings given such terms by the
Commissioner for purposes of this division.
(c) Transition.--Individuals and employers shall only be eligible to
enroll or participate in the Health Insurance Exchange in accordance
with the following transition schedule:
(1) First year.--In Y1 (as defined in section 100(c))--
(A) individuals described in subsection (d)(1),
including individuals described in paragraphs (3) and
(4) of subsection (d); and
(B) smallest employers described in subsection
(e)(1).
(2) Second year.--In Y2--
(A) individuals and employers described in paragraph
(1); and
(B) smaller employers described in subsection (e)(2).
(3) Third and subsequent years.--In Y3 and subsequent years--
(A) individuals and employers described in paragraph
(2); and
(B) larger employers as permitted by the Commissioner
under subsection (e)(3).
(d) Individuals.--
(1) Individual described.--Subject to the succeeding
provisions of this subsection, an individual described in this
paragraph is an individual who--
(A) is not enrolled in coverage described in
subparagraphs (C) through (F) of paragraph (2); and
(B) is not enrolled in coverage as a full-time
employee (or as a dependent of such an employee) under
a group health plan if the coverage and an employer
contribution under the plan meet the requirements of
section 312.
For purposes of subparagraph (B), in the case of an individual
who is self-employed, who has at least 1 employee, and who
meets the requirements of section 312, such individual shall be
deemed a full-time employee described in such subparagraph.
(2) Acceptable coverage.--For purposes of this division, the
term ``acceptable coverage'' means any of the following:
(A) Qualified health benefits plan coverage.--
Coverage under a qualified health benefits plan.
(B) Grandfathered health insurance coverage; coverage
under current group health plan.--Coverage under a
grandfathered health insurance coverage (as defined in
subsection (a) of section 102) or under a current group
health plan (described in subsection (b) of such
section).
(C) Medicare.--Coverage under part A of title XVIII
of the Social Security Act.
(D) Medicaid.--Coverage for medical assistance under
title XIX of the Social Security Act, excluding such
coverage that is only available because of the
application of subsection (u), (z), or (aa) of section
1902 of such Act
(E) Members of the armed forces and dependents
(including tricare).--Coverage under chapter 55 of
title 10, United States Code, including similar
coverage furnished under section 1781 of title 38 of
such Code.
(F) VA.--Coverage under the veteran's health care
program under chapter 17 of title 38, United States
Code, but only if the coverage for the individual
involved is determined by the Commissioner in
coordination with the Secretary of Treasury to be not
less than a level specified by the Commissioner and
Secretary of Veteran's Affairs, in coordination with
the Secretary of Treasury, based on the individual's
priority for services as provided under section 1705(a)
of such title.
(G) Other coverage.--Such other health benefits
coverage, such as a State health benefits risk pool, as
the Commissioner, in coordination with the Secretary of
the Treasury, recognizes for purposes of this
paragraph.
The Commissioner shall make determinations under this paragraph
in coordination with the Secretary of the Treasury.
(3) Treatment of certain non-traditional medicaid eligible
individuals.--An individual who is a non-traditional Medicaid
eligible individual (as defined in section 205(e)(4)(C)) in a
State may be an Exchange-eligible individual if the individual
was enrolled in a qualified health benefits plan, grandfathered
health insurance coverage, or current group health plan during
the 6 months before the individual became a non-traditional
Medicaid eligible individual. During the period in which such
an individual has chosen to enroll in an Exchange-participating
health benefits plan, the individual is not also eligible for
medical assistance under Medicaid.
(4) Continuing eligibility permitted.--
(A) In general.--Except as provided in subparagraph
(B), once an individual qualifies as an Exchange-
eligible individual under this subsection (including as
an employee or dependent of an employee of an Exchange-
eligible employer) and enrolls under an Exchange-
participating health benefits plan through the Health
Insurance Exchange, the individual shall continue to be
treated as an Exchange-eligible individual until the
individual is no longer enrolled with an Exchange-
participating health benefits plan.
(B) Exceptions.--
(i) In general.--Subparagraph (A) shall not
apply to an individual once the individual
becomes eligible for coverage--
(I) under part A of the Medicare
program;
(II) under the Medicaid program as a
Medicaid eligible individual, except as
permitted under paragraph (3) or clause
(ii); or
(III) in such other circumstances as
the Commissioner may provide.
(ii) Transition period.--In the case
described in clause (i)(II), the Commissioner
shall permit the individual to continue
treatment under subparagraph (A) until such
limited time as the Commissioner determines it
is administratively feasible, consistent with
minimizing disruption in the individual's
access to health care.
(e) Employers.--
(1) Smallest employer.--Subject to paragraph (4), smallest
employers described in this paragraph are employers with 10 or
fewer employees.
(2) Smaller employers.--Subject to paragraph (4), smaller
employers described in this paragraph are employers that are
not smallest employers described in paragraph (1) and have 20
or fewer employees.
(3) Larger employers.--
(A) In general.--Beginning with Y3, the Commissioner
may permit employers not described in paragraph (1) or
(2) to be Exchange-eligible employers.
(B) Phase-in.--In applying subparagraph (A), the
Commissioner may phase-in the application of such
subparagraph based on the number of full-time employees
of an employer and such other considerations as the
Commissioner deems appropriate.
(4) Continuing eligibility.--Once an employer is permitted to
be an Exchange-eligible employer under this subsection and
enrolls employees through the Health Insurance Exchange, the
employer shall continue to be treated as an Exchange-eligible
employer for each subsequent plan year regardless of the number
of employees involved unless and until the employer meets the
requirement of section 311(a) through paragraph (1) of such
section by offering a group health plan and not through
offering an Exchange-participating health benefits plan.
(5) Employer participation and contributions.--
(A) Satisfaction of employer responsibility.--For any
year in which an employer is an Exchange-eligible
employer, such employer may meet the requirements of
section 312 with respect to employees of such employer
by offering such employees the option of enrolling with
Exchange-participating health benefits plans through
the Health Insurance Exchange consistent with the
provisions of subtitle B of title III.
(B) Employee choice.--Any employee offered Exchange-
participating health benefits plans by the employer of
such employee under subparagraph (A) may choose
coverage under any such plan. That choice includes,
with respect to family coverage, coverage of the
dependents of such employee.
(6) Affiliated groups.--Any employer which is part of a group
of employers who are treated as a single employer under
subsection (b), (c), (m), or (o) of section 414 of the Internal
Revenue Code of 1986 shall be treated, for purposes of this
subtitle, as a single employer.
(7) Other counting rules.--The Commissioner shall establish
rules relating to how employees are counted for purposes of
carrying out this subsection.
(f) Special Situation Authority.--The Commissioner shall have the
authority to establish such rules as may be necessary to deal with
special situations with regard to uninsured individuals and employers
participating as Exchange-eligible individuals and employers, such as
transition periods for individuals and employers who gain, or lose,
Exchange-eligible participation status, and to establish grace periods
for premium payment.
(g) Surveys of Individuals and Employers.--The Commissioner shall
provide for periodic surveys of Exchange-eligible individuals and
employers concerning satisfaction of such individuals and employers
with the Health Insurance Exchange and Exchange-participating health
benefits plans.
(h) Exchange Access Study.--
(1) In general.--The Commissioner shall conduct a study of
access to the Health Insurance Exchange for individuals and for
employers, including individuals and employers who are not
eligible and enrolled in Exchange-participating health benefits
plans. The goal of the study is to determine if there are
significant groups and types of individuals and employers who
are not Exchange-eligible individuals or employers, but who
would have improved benefits and affordability if made eligible
for coverage in the Exchange.
(2) Items included in study.--Such study also shall examine--
(A) the terms, conditions, and affordability of group
health coverage offered by employers and QHBP offering
entities outside of the Exchange compared to Exchange-
participating health benefits plans; and
(B) the affordability-test standard for access of
certain employed individuals to coverage in the Health
Insurance Exchange.
(3) Report.--Not later than January 1 of Y3, in Y6, and
thereafter, the Commissioner shall submit to Congress on the
study conducted under this subsection and shall include in such
report recommendations regarding changes in standards for
Exchange eligibility for individuals and employers.
(i) Exception for Veterans and Members of Armed Forces.--
Notwithstanding any other provision of this Act, an individual with
acceptable coverage described in subparagraph (E) or (F) of subsection
(d)(2) is eligible to obtain coverage through enrollment in an
Exchange-participating health benefits plan offered through the Health
Insurance Exchange.
(j) Department of Veterans Affairs and Department of Defense Health
Programs.--Nothing in this section shall be construed as affecting any
authority under title 38, United States Code, or chapter 55 of title
10, United States Code.
(k) Report on Comparable Coverage for CHIP Children; Special Rule for
CHIP Children.--
(1) Report.--No later than December 31, 2011, the Secretary
of Health and Human Services shall submit to Congress a report
that compares the benefits packages offered in 2011 to an
average State child health plan under title XXI of the Social
Security Act and to the benefit standards adopted under section
124 for the essential benefits package and the affordability
credits under subtitle C.
(2) Certification of secretary.--Notwithstanding the previous
provisions of this section, no child who would be eligible for
coverage under title XXI of the Social Security Act shall be
enrolled in an Exchange participating health benefits plan
until the Secretary of Health and Human Services has certified,
based on the findings in the report under paragraph (1) and
changes made pursuant to the recommendations in the report, if
any, that the coverage (as described in section 121(a)) is at
least comparable to the coverage provided to children under an
average State child health plan under such title as in effect
in 2011.
SEC. 203. BENEFITS PACKAGE LEVELS.
(a) In General.--The Commissioner shall specify the benefits to be
made available under Exchange-participating health benefits plans
during each plan year, consistent with subtitle C of title I and this
section.
(b) Limitation on Health Benefits Plans Offered by Offering
Entities.--The Commissioner may not enter into a contract with a QHBP
offering entity under section 204(c) for the offering of an Exchange-
participating health benefits plan in a service area unless the
following requirements are met:
(1) Required offering of basic plan.--The entity offers only
one basic plan for such service area.
(2) Optional offering of enhanced plan.--If and only if the
entity offers a basic plan for such service area, the entity
may offer one enhanced plan for such area.
(3) Optional offering of premium plan.--If and only if the
entity offers an enhanced plan for such service area, the
entity may offer one premium plan for such area.
(4) Optional offering of premium-plus plans.--If and only if
the entity offers a premium plan for such service area, the
entity may offer one or more premium-plus plans for such area.
All such plans may be offered under a single contract with the
Commissioner.
(c) Specification of Benefit Levels for Plans.--
(1) In general.--The Commissioner shall establish the
following standards consistent with this subsection and title
I:
(A) Basic, enhanced, and premium plans.--Standards
for 3 levels of Exchange-participating health benefits
plans: basic, enhanced, and premium (in this division
referred to as a ``basic plan'', ``enhanced plan'', and
``premium plan'', respectively).
(B) Premium-plus plan benefits.--Standards for
additional benefits that may be offered, consistent
with this subsection and subtitle C of title I, under a
premium plan (such a plan with additional benefits
referred to in this division as a ``premium-plus
plan'') .
(2) Basic plan.--
(A) In general.--A basic plan shall offer the
essential benefits package required under title I for a
qualified health benefits plan.
(B) Tiered cost-sharing for affordable credit
eligible individuals.--In the case of an affordable
credit eligible individual (as defined in section
242(a)(1)) enrolled in an Exchange-participating health
benefits plan, the benefits under a basic plan are
modified to provide for the reduced cost-sharing for
the income tier applicable to the individual under
section 244(c).
(3) Enhanced plan.--An enhanced plan shall offer, in addition
to the level of benefits under the basic plan, a lower level of
cost-sharing as provided under title I consistent with section
123(b)(5)(A).
(4) Premium plan.--A premium plan shall offer, in addition to
the level of benefits under the basic plan, a lower level of
cost-sharing as provided under title I consistent with section
123(b)(5)(B).
(5) Premium-plus plan.--A premium-plus plan is a premium plan
that also provides additional benefits, such as adult oral
health and vision care, approved by the Commissioner. The
portion of the premium that is attributable to such additional
benefits shall be separately specified.
(6) Range of permissible variation in cost-sharing.--The
Commissioner shall establish a permissible range of variation
of cost-sharing for each basic, enhanced, and premium plan,
except with respect to any benefit for which there is no cost-
sharing permitted under the essential benefits package. Such
variation shall permit a variation of not more than plus (or
minus) 10 percent in cost-sharing with respect to each benefit
category specified under section 122.
(d) Treatment of State Benefit Mandates.--Insofar as a State requires
a health insurance issuer offering health insurance coverage to include
benefits beyond the essential benefits package, such requirement shall
continue to apply to an Exchange-participating health benefits plan, if
the State has entered into an arrangement satisfactory to the
Commissioner to reimburse the Commissioner for the amount of any net
increase in affordability premium credits under subtitle C as a result
of an increase in premium in basic plans as a result of application of
such requirement.
(e) Rules Regarding Coverage of and Affordability Credits for
Specified Services.--
(1) Assured availability of varied coverage through the
health insurance exchange.--The Commissioner shall assure that,
of the Exchange participating health benefits plan offered in
each premium rating area of the Health Insurance Exchange--
(A) there is at least one such plan that provides
coverage of services described in subparagraphs (A) and
(B) of section 122(d)(4); and
(B) there is at least one such plan that does not
provide coverage of services described in section
122(d)(4)(A) which plan may also be one that does not
provide coverage of services described in section
122(d)(4)(B).
(2) Segregation of funds.--If a qualified health benefits
plan provides coverage of services described in section
122(d)(4)(A), the plan shall provide assurances satisfactory to
the Commissioner that--
(A) any affordability credits provided under subtitle
C of title II are not used for purposes of paying for
such services; and
(B) only premium amounts attributable to the
actuarial value described in section 113(b) are used
for such purpose.
SEC. 204. CONTRACTS FOR THE OFFERING OF EXCHANGE-PARTICIPATING HEALTH
BENEFITS PLANS.
(a) Contracting Duties.--In carrying out section 201(b)(1) and
consistent with this subtitle:
(1) Offering entity and plan standards.--The Commissioner
shall--
(A) establish standards necessary to implement the
requirements of this title and title I for--
(i) QHBP offering entities for the offering
of an Exchange-participating health benefits
plan; and
(ii) for Exchange-participating health
benefits plans; and
(B) certify QHBP offering entities and qualified
health benefits plans as meeting such standards and
requirements of this title and title I for purposes of
this subtitle.
(2) Soliciting and negotiating bids; contracts.--The
Commissioner shall--
(A) solicit bids from QHBP offering entities for the
offering of Exchange-participating health benefits
plans;
(B) based upon a review of such bids, negotiate with
such entities for the offering of such plans; and
(C) enter into contracts with such entities for the
offering of such plans through the Health Insurance
Exchange under terms (consistent with this title)
negotiated between the Commissioner and such entities.
(3) FAR not applicable.--The provisions of the Federal
Acquisition Regulation shall not apply to contracts between the
Commissioner and QHBP offering entities for the offering of
Exchange-participating health benefits plans under this title.
(b) Standards for QHBP Offering Entities to Offer Exchange-
participating Health Benefits Plans.--The standards established under
subsection (a)(1)(A) shall require that, in order for a QHBP offering
entity to offer an Exchange-participating health benefits plan, the
entity must meet the following requirements:
(1) Licensed.--The entity shall be licensed to offer health
insurance coverage under State law for each State in which it
is offering such coverage.
(2) Data reporting.--The entity shall provide for the
reporting of such information as the Commissioner may specify,
including information necessary to administer the risk pooling
mechanism described in section 206(b) and information to
address disparities in health and health care.
(3) Implementing affordability credits.--The entity shall
provide for implementation of the affordability credits
provided for enrollees under subtitle C, including the
reduction in cost-sharing under section 244(c).
(4) Enrollment.--The entity shall accept all enrollments
under this subtitle, subject to such exceptions (such as
capacity limitations) in accordance with the requirements under
title I for a qualified health benefits plan. The entity shall
notify the Commissioner if the entity projects or anticipates
reaching such a capacity limitation that would result in a
limitation in enrollment.
(5) Risk pooling participation.--The entity shall participate
in such risk pooling mechanism as the Commissioner establishes
under section 206(b).
(6) Essential community providers.--With respect to the basic
plan offered by the entity, the entity shall contract for
outpatient services with covered entities (as defined in
section 340B(a)(4) of the Public Health Service Act, as in
effect as of July 1, 2009). The Commissioner shall specify the
extent to which and manner in which the previous sentence shall
apply in the case of a basic plan with respect to which the
Commissioner determines provides substantially all benefits
through a health maintenance organization, as defined in
section 2791(b)(3) of the Public Health Service Act.
(7) Culturally and linguistically appropriate services and
communications.--The entity shall provide for culturally and
linguistically appropriate communication and health services.
(8) Additional requirements.--The entity shall comply with
other applicable requirements of this title, as specified by
the Commissioner, which shall include standards regarding
billing and collection practices for premiums and related grace
periods and which may include standards to ensure that the
entity does not use coercive practices to force providers not
to contract with other entities offering coverage through the
Health Insurance Exchange.
(c) Contracts.--
(1) Bid application.--To be eligible to enter into a contract
under this section, a QHBP offering entity shall submit to the
Commissioner a bid at such time, in such manner, and containing
such information as the Commissioner may require.
(2) Term.--Each contract with a QHBP offering entity under
this section shall be for a term of not less than one year, but
may be made automatically renewable from term to term in the
absence of notice of termination by either party.
(3) Enforcement of network adequacy.--In the case of a health
benefits plan of a QHBP offering entity that uses a provider
network, the contract under this section with the entity shall
provide that if--
(A) the Commissioner determines that such provider
network does not meet such standards as the
Commissioner shall establish under section 115; and
(B) an individual enrolled in such plan receives an
item or service from a provider that is not within such
network;
then any cost-sharing for such item or service shall be equal
to the amount of such cost-sharing that would be imposed if
such item or service was furnished by a provider within such
network.
(4) Oversight and enforcement responsibilities.--The
Commissioner shall establish processes, in coordination with
State insurance regulators, to oversee, monitor, and enforce
applicable requirements of this title with respect to QHBP
offering entities offering Exchange-participating health
benefits plans and such plans, including the marketing of such
plans. Such processes shall include the following:
(A) Grievance and complaint mechanisms.--The
Commissioner shall establish, in coordination with
State insurance regulators, a process under which
Exchange-eligible individuals and employers may file
complaints concerning violations of such standards.
(B) Enforcement.--In carrying out authorities under
this division relating to the Health Insurance
Exchange, the Commissioner may impose one or more of
the intermediate sanctions described in section 142(c).
(C) Termination.--
(i) In general.--The Commissioner may
terminate a contract with a QHBP offering
entity under this section for the offering of
an Exchange-participating health benefits plan
if such entity fails to comply with the
applicable requirements of this title. Any
determination by the Commissioner to terminate
a contract shall be made in accordance with
formal investigation and compliance procedures
established by the Commissioner under which--
(I) the Commissioner provides the
entity with the reasonable opportunity
to develop and implement a corrective
action plan to correct the deficiencies
that were the basis of the
Commissioner's determination; and
(II) the Commissioner provides the
entity with reasonable notice and
opportunity for hearing (including the
right to appeal an initial decision)
before terminating the contract.
(ii) Exception for imminent and serious risk
to health.--Clause (i) shall not apply if the
Commissioner determines that a delay in
termination, resulting from compliance with the
procedures specified in such clause prior to
termination, would pose an imminent and serious
risk to the health of individuals enrolled
under the qualified health benefits plan of the
QHBP offering entity.
(D) Construction.--Nothing in this subsection shall
be construed as preventing the application of other
sanctions under subtitle E of title I with respect to
an entity for a violation of such a requirement.
(d) No Discrimination on the Basis of Provision of Abortion.--No
Exchange participating health benefits plan may discriminate against
any individual health care provider or health care facility because of
its willingness or unwillingness to provide, pay for, provide coverage
of, or refer for abortions.
SEC. 205. OUTREACH AND ENROLLMENT OF EXCHANGE-ELIGIBLE INDIVIDUALS AND
EMPLOYERS IN EXCHANGE-PARTICIPATING HEALTH BENEFITS
PLANS.
(a) In General.--
(1) Outreach.--The Commissioner shall conduct outreach
activities consistent with subsection (c), including through
use of appropriate entities as described in paragraph (3) of
such subsection, to inform and educate individuals and
employers about the Health Insurance Exchange and Exchange-
participating health benefits plan options. Such outreach shall
include outreach specific to vulnerable populations, such as
children, individuals with disabilities, individuals with
mental illness, and individuals with other cognitive
impairments.
(2) Eligibility.--The Commissioner shall make timely
determinations of whether individuals and employers are
Exchange-eligible individuals and employers (as defined in
section 202).
(3) Enrollment.--The Commissioner shall establish and carry
out an enrollment process for Exchange-eligible individuals and
employers, including at community locations, in accordance with
subsection (b).
(b) Enrollment Process.--
(1) In general.--The Commissioner shall establish a process
consistent with this title for enrollments in Exchange-
participating health benefits plans. Such process shall provide
for enrollment through means such as the mail, by telephone,
electronically, and in person.
(2) Enrollment periods.--
(A) Open enrollment period.--The Commissioner shall
establish an annual open enrollment period during which
an Exchange-eligible individual or employer may elect
to enroll in an Exchange-participating health benefits
plan for the following plan year and an enrollment
period for affordability credits under subtitle C. Such
periods shall be during September through November of
each year, or such other time that would maximize
timeliness of income verification for purposes of such
subtitle. The open enrollment period shall not be less
than 30 days.
(B) Special enrollment.--The Commissioner shall also
provide for special enrollment periods to take into
account special circumstances of individuals and
employers, such as an individual who--
(i) loses acceptable coverage;
(ii) experiences a change in marital or other
dependent status;
(iii) moves outside the service area of the
Exchange-participating health benefits plan in
which the individual is enrolled; or
(iv) experiences a significant change in
income.
(C) Enrollment information.--The Commissioner shall
provide for the broad dissemination of information to
prospective enrollees on the enrollment process,
including before each open enrollment period. In
carrying out the previous sentence, the Commissioner
may work with other appropriate entities to facilitate
such provision of information.
(3) Automatic enrollment for non-medicaid eligible
individuals.--
(A) In general.--The Commissioner shall provide for a
process under which individuals who are Exchange-
eligible individuals described in subparagraph (B) are
automatically enrolled under an appropriate Exchange-
participating health benefits plan. Such process may
involve a random assignment or some other form of
assignment that takes into account the health care
providers used by the individual involved or such other
relevant factors as the Commissioner may specify.
(B) Subsidized individuals described.--An individual
described in this subparagraph is an Exchange-eligible
individual who is either of the following:
(i) Affordability credit eligible
individuals.--The individual--
(I) has applied for, and been
determined eligible for, affordability
credits under subtitle C;
(II) has not opted out from receiving
such affordability credit; and
(III) does not otherwise enroll in
another Exchange-participating health
benefits plan.
(ii) Individuals enrolled in a terminated
plan.--The individual is enrolled in an
Exchange-participating health benefits plan
that is terminated (during or at the end of a
plan year) and who does not otherwise enroll in
another Exchange-participating health benefits
plan.
(4) Direct payment of premiums to plans.--Under the
enrollment process, individuals enrolled in an Exchange-
participating health benefits plan shall pay such plans
directly, and not through the Commissioner or the Health
Insurance Exchange.
(c) Coverage Information and Assistance.--
(1) Coverage information.--The Commissioner shall provide for
the broad dissemination of information on Exchange-
participating health benefits plans offered under this title.
Such information shall be provided in a comparative manner, and
shall include information on benefits, premiums, cost-sharing,
quality, provider networks, and consumer satisfaction.
(2) Consumer assistance with choice.--To provide assistance
to Exchange-eligible individuals and employers, the
Commissioner shall--
(A) provide for the operation of a toll-free
telephone hotline to respond to requests for assistance
and maintain an Internet website through which
individuals may obtain information on coverage under
Exchange-participating health benefits plans and file
complaints;
(B) develop and disseminate information to Exchange-
eligible enrollees on their rights and
responsibilities;
(C) assist Exchange-eligible individuals in selecting
Exchange-participating health benefits plans and
obtaining benefits through such plans; and
(D) ensure that the Internet website described in
subparagraph (A) and the information described in
subparagraph (B) is developed using plain language (as
defined in section 133(a)(2)).
(3) Use of other entities.--In carrying out this subsection,
the Commissioner may work with other appropriate entities to
facilitate the dissemination of information under this
subsection and to provide assistance as described in paragraph
(2).
(d) Special Duties Related to Medicaid and CHIP.--
(1) Coverage for certain newborns.--
(A) In general.--In the case of a child born in the
United States who at the time of birth is not otherwise
covered under acceptable coverage, for the period of
time beginning on the date of birth and ending on the
date the child otherwise is covered under acceptable
coverage (or, if earlier, the end of the month in which
the 60-day period, beginning on the date of birth,
ends), the child shall be deemed--
(i) to be a non-traditional Medicaid eligible
individual (as defined in subsection (e)(5))
for purposes of this division and Medicaid; and
(ii) to have elected to enroll in Medicaid
through the application of paragraph (3).
(B) Extended treatment as traditional medicaid
eligible individual.--In the case of a child described
in subparagraph (A) who at the end of the period
referred to in such subparagraph is not otherwise
covered under acceptable coverage, the child shall be
deemed (until such time as the child obtains such
coverage or the State otherwise makes a determination
of the child's eligibility for medical assistance under
its Medicaid plan pursuant to section 1943(c)(1) of the
Social Security Act) to be a traditional Medicaid
eligible individual described in section 1902(l)(1)(B)
of such Act.
(2) CHIP transition.--A child who, as of the day before the
first day of Y1, is eligible for child health assistance under
title XXI of the Social Security Act (including a child
receiving coverage under an arrangement described in section
2101(a)(2) of such Act) is deemed as of such first day to be an
Exchange-eligible individual unless the individual is a
traditional Medicaid eligible individual as of such day.
(3) Automatic enrollment of medicaid eligible individuals
into medicaid.--The Commissioner shall provide for a process
under which an individual who is described in section 202(d)(3)
and has not elected to enroll in an Exchange-participating
health benefits plan is automatically enrolled under Medicaid.
(4) Notifications.--The Commissioner shall notify each State
in Y1 and for purposes of section 1902(gg)(1) of the Social
Security Act (as added by section 1703(a)) whether the Health
Insurance Exchange can support enrollment of children described
in paragraph (2) in such State in such year.
(e) Medicaid Coverage for Medicaid Eligible Individuals.--
(1) In general.--
(A) Choice for limited exchange-eligible
individuals.--As part of the enrollment process under
subsection (b), the Commissioner shall provide the
option, in the case of an Exchange-eligible individual
described in section 202(d)(3), for the individual to
elect to enroll under Medicaid instead of under an
Exchange-participating health benefits plan. Such an
individual may change such election during an
enrollment period under subsection (b)(2).
(B) Medicaid enrollment obligation.--An Exchange
eligible individual may apply, in the manner described
in section 241(b)(1), for a determination of whether
the individual is a Medicaid-eligible individual. If
the individual is determined to be so eligible, the
Commissioner, through the Medicaid memorandum of
understanding, shall provide for the enrollment of the
individual under the State Medicaid plan in accordance
with the Medicaid memorandum of understanding under
paragraph (4). In the case of such an enrollment, the
State shall provide for the same periodic
redetermination of eligibility under Medicaid as would
otherwise apply if the individual had directly applied
for medical assistance to the State Medicaid agency.
(2) Non-traditional medicaid eligible individuals.--In the
case of a non-traditional Medicaid eligible individual
described in section 202(d)(3) who elects to enroll under
Medicaid under paragraph (1)(A), the Commissioner shall provide
for the enrollment of the individual under the State Medicaid
plan in accordance with the Medicaid memorandum of
understanding under paragraph (3).
(3) Coordinated enrollment with state through memorandum of
understanding.--The Commissioner, in consultation with the
Secretary of Health and Human Services, shall enter into a
memorandum of understanding with each State (each in this
division referred to as a ``Medicaid memorandum of
understanding'') with respect to coordinating enrollment of
individuals in Exchange-participating health benefits plans and
under the State's Medicaid program consistent with this section
and to otherwise coordinate the implementation of the
provisions of this division with respect to the Medicaid
program. Such memorandum shall permit the exchange of
information consistent with the limitations described in
section 1902(a)(7) of the Social Security Act. Nothing in this
section shall be construed as permitting such memorandum to
modify or vitiate any requirement of a State Medicaid plan.
(4) Medicaid eligible individuals.--For purposes of this
division:
(A) Medicaid eligible individual.--The term
``Medicaid eligible individual'' means an individual
who is eligible for medical assistance under Medicaid.
(B) Traditional medicaid eligible individual.--The
term ``traditional Medicaid eligible individual'' means
a Medicaid eligible individual other than an individual
who is--
(i) a Medicaid eligible individual by reason
of the application of subclause (VIII) of
section 1902(a)(10)(A)(i) of the Social
Security Act; or
(ii) a childless adult not described in
section 1902(a)(10)(A) or (C) of such Act (as
in effect as of the day before the date of the
enactment of this Act).
(C) Non-traditional medicaid eligible individual.--
The term ``non-traditional Medicaid eligible
individual'' means a Medicaid eligible individual who
is not a traditional Medicaid eligible individual.
(f) Effective Culturally and Linguistically Appropriate
Communication.--In carrying out this section, the Commissioner shall
establish effective methods for communicating in plain language and a
culturally and linguistically appropriate manner.
(g) Role for Enrollment Agents and Brokers.--Nothing in this division
shall be construed to affect the role of enrollment agents and brokers
under State law, including with regard to the enrollment of individuals
and employers in qualified health benefits plans including the public
health insurance option.
SEC. 206. OTHER FUNCTIONS.
(a) Coordination of Affordability Credits.--The Commissioner shall
coordinate the distribution of affordability premium and cost-sharing
credits under subtitle C to QHBP offering entities offering Exchange-
participating health benefits plans.
(b) Coordination of Risk Pooling.--The Commissioner shall establish a
mechanism whereby there is an adjustment made of the premium amounts
payable among QHBP offering entities offering Exchange-participating
health benefits plans of premiums collected for such plans that takes
into account (in a manner specified by the Commissioner) the
differences in the risk characteristics of individuals and employers
enrolled under the different Exchange-participating health benefits
plans offered by such entities so as to minimize the impact of adverse
selection of enrollees among the plans offered by such entities.
(c) Special Inspector General for the Health Insurance Exchange.--
(1) Establishment; appointment.--There is hereby established
the Office of the Special Inspector General for the Health
Insurance Exchange, to be headed by a Special Inspector General
for the Health Insurance Exchange (in this subsection referred
to as the ``Special Inspector General'') to be appointed by the
President, by and with the advice and consent of the Senate.
The nomination of an individual as Special Inspector General
shall be made as soon as practicable after the establishment of
the program under this subtitle.
(2) Duties.--The Special Inspector General shall--
(A) conduct, supervise, and coordinate audits,
evaluations and investigations of the Health Insurance
Exchange to protect the integrity of the Health
Insurance Exchange, as well as the health and welfare
of participants in the Exchange;
(B) report both to the Commissioner and to the
Congress regarding program and management problems and
recommendations to correct them;
(C) have other duties (described in paragraphs (2)
and (3) of section 121 of division A of Public Law 110-
343) in relation to the duties described in the
previous subparagraphs; and
(D) have the authorities provided in section 6 of the
Inspector General Act of 1978 in carrying out duties
under this paragraph.
(3) Application of other special inspector general
provisions.--The provisions of subsections (b) (other than
paragraphs (1) and (3)), (d) (other than paragraph (1)), and
(e) of section 121 of division A of the Emergency Economic
Stabilization Act of 2009 (Public Law 110-343) shall apply to
the Special Inspector General under this subsection in the same
manner as such provisions apply to the Special Inspector
General under such section.
(4) Reports.--Not later than one year after the confirmation
of the Special Inspector General, and annually thereafter, the
Special Inspector General shall submit to the appropriate
committees of Congress a report summarizing the activities of
the Special Inspector General during the one year period ending
on the date such report is submitted.
(5) Termination.--The Office of the Special Inspector General
shall terminate five years after the date of the enactment of
this Act.
SEC. 207. HEALTH INSURANCE EXCHANGE TRUST FUND.
(a) Establishment of Health Insurance Exchange Trust Fund.--There is
created within the Treasury of the United States a trust fund to be
known as the ``Health Insurance Exchange Trust Fund'' (in this section
referred to as the ``Trust Fund''), consisting of such amounts as may
be appropriated or credited to the Trust Fund under this section or any
other provision of law.
(b) Payments From Trust Fund.--The Commissioner shall pay from time
to time from the Trust Fund such amounts as the Commissioner determines
are necessary to make payments to operate the Health Insurance
Exchange, including payments under subtitle C (relating to
affordability credits).
(c) Transfers to Trust Fund.--
(1) Dedicated payments.--There is hereby appropriated to the
Trust Fund amounts equivalent to the following:
(A) Taxes on individuals not obtaining acceptable
coverage.--The amounts received in the Treasury under
section 59B of the Internal Revenue Code of 1986
(relating to requirement of health insurance coverage
for individuals).
(B) Employment taxes on employers not providing
acceptable coverage.--The amounts received in the
Treasury under section 3111(c) of the Internal Revenue
Code of 1986 (relating to employers electing to not
provide health benefits).
(C) Excise tax on failures to meet certain health
coverage requirements.--The amounts received in the
Treasury under section 4980H(b) (relating to excise tax
with respect to failure to meet health coverage
participation requirements).
(2) Appropriations to cover government contributions.--There
are hereby appropriated, out of any moneys in the Treasury not
otherwise appropriated, to the Trust Fund, an amount equivalent
to the amount of payments made from the Trust Fund under
subsection (b) plus such amounts as are necessary reduced by
the amounts deposited under paragraph (1).
(d) Application of Certain Rules.--Rules similar to the rules of
subchapter B of chapter 98 of the Internal Revenue Code of 1986 shall
apply with respect to the Trust Fund.
SEC. 208. OPTIONAL OPERATION OF STATE-BASED HEALTH INSURANCE EXCHANGES.
(a) In General.--If--
(1) a State (or group of States, subject to the approval of
the Commissioner) applies to the Commissioner for approval of a
State-based Health Insurance Exchange to operate in the State
(or group of States); and
(2) the Commissioner approves such State-based Health
Insurance Exchange,
then, subject to subsections (c) and (d), the State-based Health
Insurance Exchange shall operate, instead of the Health Insurance
Exchange, with respect to such State (or group of States). The
Commissioner shall approve a State-based Health Insurance Exchange if
it meets the requirements for approval under subsection (b).
(b) Requirements for Approval.--
(1) In general.--The Commissioner may not approve a State-
based Health Insurance Exchange under this section unless the
following requirements are met:
(A) The State-based Health Insurance Exchange must
demonstrate the capacity to and provide assurances
satisfactory to the Commissioner that the State-based
Health Insurance Exchange will carry out the functions
specified for the Health Insurance Exchange in the
State (or States) involved, including--
(i) negotiating and contracting with QHBP
offering entities for the offering of Exchange-
participating health benefits plan, which
satisfy the standards and requirements of this
title and title I;
(ii) enrolling Exchange-eligible individuals
and employers in such State in such plans;
(iii) the establishment of sufficient local
offices to meet the needs of Exchange-eligible
individuals and employers;
(iv) administering affordability credits
under subtitle B using the same methodologies
(and at least the same income verification
methods) as would otherwise apply under such
subtitle and at a cost to the Federal
Government which does exceed the cost to the
Federal Government if this section did not
apply; and
(v) enforcement activities consistent with
federal requirements.
(B) There is no more than one Health Insurance
Exchange operating with respect to any one State.
(C) The State provides assurances satisfactory to the
Commissioner that approval of such an Exchange will not
result in any net increase in expenditures to the
Federal Government.
(D) The State provides for reporting of such
information as the Commissioner determines and
assurances satisfactory to the Commissioner that it
will vigorously enforce violations of applicable
requirements.
(E) The State is eligible to receive an incentive
payment for enacting and implementing medical liability
reforms as specified in subsection (g).
(F) Such other requirements as the Commissioner may
specify.
(2) Presumption for certain state-operated exchanges.--
(A) In general.--In the case of a State operating an
Exchange prior to January 1, 2010 that seeks to operate
the State-based Health Insurance Exchange under this
section, the Commissioner shall presume that such
Exchange meets the standards under this section unless
the Commissioner determines, after completion of the
process established under subparagraph (B), that the
Exchange does not comply with such standards.
(B) Process.--The Commissioner shall establish a
process to work with a State described in subparagraph
(A) to provide assistance necessary to assure that the
State's Exchange comes into compliance with the
standards for approval under this section.
(c) Ceasing Operation.--
(1) In general.--A State-based Health Insurance Exchange may,
at the option of each State involved, and only after providing
timely and reasonable notice to the Commissioner, cease
operation as such an Exchange, in which case the Health
Insurance Exchange shall operate, instead of such State-based
Health Insurance Exchange, with respect to such State (or
States).
(2) Termination; health insurance exchange resumption of
functions.--The Commissioner may terminate the approval (for
some or all functions) of a State-based Health Insurance
Exchange under this section if the Commissioner determines that
such Exchange no longer meets the requirements of subsection
(b) or is no longer capable of carrying out such functions in
accordance with the requirements of this subtitle. In lieu of
terminating such approval, the Commissioner may temporarily
assume some or all functions of the State-based Health
Insurance Exchange until such time as the Commissioner
determines the State-based Health Insurance Exchange meets such
requirements of subsection (b) and is capable of carrying out
such functions in accordance with the requirements of this
subtitle.
(3) Effectiveness.--The ceasing or termination of a State-
based Health Insurance Exchange under this subsection shall be
effective in such time and manner as the Commissioner shall
specify.
(d) Retention of Authority.--
(1) Authority retained.--Enforcement authorities of the
Commissioner shall be retained by the Commissioner.
(2) Discretion to retain additional authority.--The
Commissioner may specify functions of the Health Insurance
Exchange that--
(A) may not be performed by a State-based Health
Insurance Exchange under this section; or
(B) may be performed by the Commissioner and by such
a State-based Health Insurance Exchange.
(e) References.--In the case of a State-based Health Insurance
Exchange, except as the Commissioner may otherwise specify under
subsection (d), any references in this subtitle to the Health Insurance
Exchange or to the Commissioner in the area in which the State-based
Health Insurance Exchange operates shall be deemed a reference to the
State-based Health Insurance Exchange and the head of such Exchange,
respectively.
(f) Funding.--In the case of a State-based Health Insurance Exchange,
there shall be assistance provided for the operation of such Exchange
in the form of a matching grant with a State share of expenditures
required.
(g) Medical Liability Alternatives.--
(1) Purposes.--The purposes of this subsection are--
(A) to ensure quality healthcare is readily available
by providing an alternative framework to reduce the
costs of defensive medicine and allow victims of
malpractice to be fairly compensated; and
(B) to do the above without limiting attorneys fees
or imposing caps on damages.
(2) Incentive payments for medical liability reform.--
(A) In general.--Each State is eligible to receive an
incentive payment, in an amount determined by the
Secretary subject to the availability of
appropriations, if the State enacts after the date of
the enactment of this subsection, and is implementing,
an alternative medical liability law that complies with
this subsection.
(B) Determination by secretary.--The Secretary shall
determine that a State's alternative medical liability
law complies with this subsection if the Secretary is
satisfied that the State--
(i) has enacted and is currently implementing
that law; and
(ii) that law is effective.
(C) Considerations for determination.--In making a
determination of the effectiveness of a law, the
Secretary shall consider whether the law--
(i) makes the medical liability system more
reliable through prevention of or prompt and
fair resolution of disputes;
(ii) encourages the disclosure of health care
errors; and
(iii) maintains access to affordable
liability insurance.
(D) Optional contents of alternative medical
liability law.--An alternative medical liability law
shall contain any one or a combination of the following
litigation alternatives:
(i) Certificate of Merit.
(ii) Early offer.
(E) Use of incentive payments.--The State shall use
an incentive payment received under this subsection to
improve health care in that State.
(3) Application.--Each State seeking an incentive payment
under this subsection shall submit to the Secretary an
application, at such time, in such manner, and containing such
information as the Secretary may require.
(4) Technical assistance.--The Secretary may provide
technical assistance to the States applying for or awarded an
incentive payment under this subsection.
(5) Reports.--Beginning not later than one year after the
date of the enactment of this subsection, the Secretary shall
submit to Congress an annual report on the progress States have
made in adopting and implementing alternative medical liability
laws that comply with this subsection. Such reports shall
contain sufficient documentation regarding the effectiveness of
such laws to enable an objective comparative analysis of them.
(6) Rulemaking.--The Secretary may make rules to carry out
this subsection.
(7) Definition.--In this subsection--
(A) the term ``Secretary'' means the Secretary of
Health and Human Services; and
(B) the term ``State'' includes the District of
Columbia, Puerto Rico, and each other territory or
possession of the United States.
(8) Authorization of appropriations.--There are authorized to
be appropriated to carry out this subsection such sums as may
be necessary, to remain available until expended.
SEC. 209. LIMITATION ON PREMIUM INCREASES UNDER EXCHANGE-PARTICIPATING
HEALTH BENEFITS PLANS.
(a) In General.--The annual increase in the premiums charged under
any Exchange-participating health benefits plan may not exceed 150
percent of the annual percentage increase in medical inflation for the
12-month period ending in June of the prior year, unless the plan
receives approval for a higher rate increase in accordance with
subsection (b) or (c).
(b) Exception for Additional Required Benefits.--If the Health
Choices Commissioner requires Exchange-participating health benefits
plans to provide additional benefits, the annual increase permitted
under subsection (a) with respect to the first year to which such
benefits are required shall be increased to take into account the costs
of such additional benefits.
(c) Exception to Where Financial Viability Threatened.--Subsection
(a) shall not apply to any Exchange-participating health benefits plan
for any year if such plan demonstrates to the Commissioner (or, if
determined appropriate by the Commissioner, the insurance commissioner
for the State in which the plan is offered) that complying with
subsection (a) for such year would threaten its financial viability or
its ability to provide timely benefits to plan participants.
(d) Non-preemption.--Nothing in this section shall be construed as
preempting existing State prior approval laws.
Subtitle B--Public Health Insurance Option
SEC. 221. ESTABLISHMENT AND ADMINISTRATION OF A PUBLIC HEALTH INSURANCE
OPTION AS AN EXCHANGE-QUALIFIED HEALTH BENEFITS
PLAN.
(a) Establishment.--For years beginning with Y1, the Secretary of
Health and Human Services (in this subtitle referred to as the
``Secretary'') shall provide for the offering of an Exchange-
participating health benefits plan (in this division referred to as the
``public health insurance option'') that ensures choice, competition,
and stability of affordable, high quality coverage throughout the
United States in accordance with this subtitle. In designing the
option, the Secretary's primary responsibility is to create a low-cost
plan without compromising quality or access to care.
(b) Offering as an Exchange-participating Health Benefits Plan.--
(1) Exclusive to the exchange.--The public health insurance
option shall only be made available through the Health
Insurance Exchange.
(2) Ensuring a level playing field.--Consistent with this
subtitle, the public health insurance option shall comply with
requirements that are applicable under this title to an
Exchange-participating health benefits plan, including
requirements related to benefits, benefit levels, provider
networks, notices, consumer protections, and cost sharing.
(3) Provision of benefit levels.--The public health insurance
option--
(A) shall offer basic, enhanced, and premium plans;
and
(B) may offer premium-plus plans.
(c) Administrative Contracting.--The Secretary may enter into
contracts for the purpose of performing administrative functions
(including functions described in subsection (a)(4) of section 1874A of
the Social Security Act) with respect to the public health insurance
option in the same manner as the Secretary may enter into contracts
under subsection (a)(1) of such section. The Secretary has the same
authority with respect to the public health insurance option as the
Secretary has under subsections (a)(1) and (b) of section 1874A of the
Social Security Act with respect to title XVIII of such Act. Contracts
under this subsection shall not involve the transfer of insurance risk
to such entity.
(d) Ombudsman.--The Secretary shall establish an office of the
ombudsman for the public health insurance option which shall have
duties with respect to the public health insurance option similar to
the duties of the Medicare Beneficiary Ombudsman under section
1808(c)(2) of the Social Security Act.
(e) Data Collection.--The Secretary shall collect such data as may be
required to establish premiums and payment rates for the public health
insurance option and for other purposes under this subtitle, including
to improve quality and to reduce racial, ethnic, and other disparities
in health and health care.
(f) Treatment of Public Health Insurance Option.--With respect to the
public health insurance option, the Secretary shall be treated as a
QHBP offering entity offering an Exchange-participating health benefits
plan.
(g) Access to Federal Courts.--The provisions of Medicare (and
related provisions of title II of the Social Security Act) relating to
access of Medicare beneficiaries to Federal courts for the enforcement
of rights under Medicare, including with respect to amounts in
controversy, shall apply to the public health insurance option and
individuals enrolled under such option under this title in the same
manner as such provisions apply to Medicare and Medicare beneficiaries.
SEC. 222. PREMIUMS AND FINANCING.
(a) Establishment of Premiums.--
(1) In general.--The Secretary shall establish
geographically-adjusted premium rates for the public health
insurance option in a manner--
(A) that complies with the premium rules established
by the Commissioner under section 113 for Exchange-
participating health benefit plans; and
(B) at a level sufficient to fully finance the costs
of--
(i) health benefits provided by the public
health insurance option; and
(ii) administrative costs related to
operating the public health insurance option.
(2) Contingency margin.--In establishing premium rates under
paragraph (1), the Secretary shall include an appropriate
amount for a contingency margin (which shall be not less than
90 days of estimated claims). Before setting such appropriate
amount for years starting with Y3, the Secretary shall solicit
a recommendation on such amount from the American Academy of
Actuaries.
(b) Account.--
(1) Establishment.--There is established in the Treasury of
the United States an Account for the receipts and disbursements
attributable to the operation of the public health insurance
option, including the start-up funding under paragraph (2).
Section 1854(g) of the Social Security Act shall apply to
receipts described in the previous sentence in the same manner
as such section applies to payments or premiums described in
such section.
(2) Start-up funding.--
(A) In general.--In order to provide for the
establishment of the public health insurance option
there is hereby appropriated to the Secretary, out of
any funds in the Treasury not otherwise appropriated,
$2,000,000,000. In order to provide for initial claims
reserves before the collection of premiums, there is
hereby appropriated to the Secretary, out of any funds
in the Treasury not otherwise appropriated, such sums
as necessary to cover 90 days worth of claims reserves
based on projected enrollment.
(B) Amortization of start-up funding.--The Secretary
shall provide for the repayment of the startup funding
provided under subparagraph (A) to the Treasury in an
amortized manner over the 10-year period beginning with
Y1.
(C) Limitation on funding.--Nothing in this section
shall be construed as authorizing any additional
appropriations to the Account, other than such amounts
as are otherwise provided with respect to other
Exchange-participating health benefits plans.
(3) No bailouts.--In no case shall the public health
insurance option receive any Federal funds for purposes of
insolvency in any manner similar to the manner in which
entities receive Federal funding under the Troubled Assets
Relief Program of the Secretary of the Treasury.
SEC. 223. NEGOTIATED PAYMENT RATES FOR ITEMS AND SERVICES.
(a) Negotiation of Payment Rates.--
(1) In general.--The Secretary shall negotiate payment rates
for the public health insurance option for services and health
care providers consistent with this section and section 224.
(2) Manner of negotiation.--The Secretary shall negotiate
such rates in a manner that results in payment rates that are
not lower, in the aggregate, than rates under title XVIII of
the Social Security Act, and not higher, in the aggregate, than
the average rates paid by other QHBP offering entities for
services and health care providers.
(3) Innovative payment methods.--Nothing in this subsection
shall be construed as preventing the use of innovative payment
methods such as those described in section 224 in connection
with the negotiation of payment rates under this subsection.
(4) Prescription drugs.--Notwithstanding any other provision
of law, the Secretary shall establish a particular formulary
for prescription drugs under the public health insurance
option.
(b) Establishment of a Provider Network.--
(1) In general.--Health care providers (including physicians
and hospitals) participating in Medicare are participating
providers in the public health insurance option unless they opt
out in a process established by the Secretary consistent with
this subsection.
(2) Requirements for opt-out process.--Under the process
established under paragraph (1)--
(A) providers described in such subparagraph shall be
provided at least a 1-year period prior to the first
day of Y1 to opt out of participating in the public
health insurance option;
(B) no provider shall be subject to a penalty for not
participating in the public health insurance option;
(C) the Secretary shall include information on how
providers participating in Medicare who chose to opt
out of participating in the public health insurance
option may opt back in; and
(D) there shall be an annual enrollment period in
which providers may decide whether to participate in
the public health insurance option.
(3) Rulemaking.--Not later than 18 months before the first
day of Y1, the Secretary shall promulgate rules (pursuant to
notice and comment) for the process described in paragraph (1).
(c) Limitations on Review.--There shall be no administrative or
judicial review of a payment rate or methodology established under this
section or under section 224.
SEC. 224. MODERNIZED PAYMENT INITIATIVES AND DELIVERY SYSTEM REFORM.
(a) In General.--For plan years beginning with Y1, the Secretary may
utilize innovative payment mechanisms and policies to determine
payments for items and services under the public health insurance
option. The payment mechanisms and policies under this section may
include patient-centered medical home and other care management
payments, accountable care organizations, value-based purchasing,
bundling of services, differential payment rates, performance or
utilization based payments, partial capitation, and direct contracting
with providers.
(b) Requirements for Innovative Payments.--The Secretary shall design
and implement the payment mechanisms and policies under this section in
a manner that--
(1) seeks to--
(A) improve health outcomes;
(B) reduce health disparities (including racial,
ethnic, and other disparities);
(C) provide efficient and affordable care;
(D) address geographic variation in the provision of
health services; or
(E) prevent or manage chronic illness; and
(2) promotes care that is integrated, patient-centered,
quality, and efficient.
(c) Encouraging the Use of High Value Services.--To the extent
allowed by the benefit standards applied to all Exchange-participating
health benefits plans, the public health insurance option may modify
cost sharing and payment rates to encourage the use of services that
promote health and value.
(d) Promotion of Delivery System Reform.--The Secretary shall monitor
and evaluate the progress of payment and delivery system reforms under
this section and shall seek to implement such reforms subject to the
following:
(1) To the extent that the Secretary finds a payment and
delivery system reform successful in improving quality and
reducing costs, the Secretary shall implement such reform on as
large a geographic scale as practical and economical.
(2) The Secretary may delay the implementation of such a
reform in geographic areas in which such implementation would
place the public health insurance option at a competitive
disadvantage.
(3) The Secretary may prioritize implementation of such a
reform in high cost geographic areas or otherwise in order to
reduce total program costs or to promote high value care.
(e) Non-uniformity Permitted.--Nothing in this subtitle shall prevent
the Secretary from varying payments based on different payment
structure models (such as accountable care organizations and medical
homes) under the public health insurance option for different
geographic areas.
SEC. 225. PROVIDER PARTICIPATION.
(a) In General.--The Secretary shall establish conditions of
participation for health care providers under the public health
insurance option.
(b) Licensure or Certification.--The Secretary shall not allow a
health care provider to participate in the public health insurance
option unless such provider is appropriately licensed or certified
under State law.
(c) Payment Terms for Providers.--The Secretary shall establish terms
and conditions for the participation (on an annual or other basis
specified by the Secretary) of physicians and other health care
providers under the public health insurance option, for which payment
may be made for services furnished during the year.
(d) Exclusion of Certain Providers.--The Secretary shall exclude from
participation under the public health insurance option a health care
provider that is excluded from participation in a Federal health care
program (as defined in section 1128B(f) of the Social Security Act).
SEC. 226. APPLICATION OF FRAUD AND ABUSE PROVISIONS.
Provisions of law (other than criminal law provisions) identified by
the Secretary by regulation, in consultation with the Inspector General
of the Department of Health and Human Services, that impose sanctions
with respect to waste, fraud, and abuse under Medicare, such as the
False Claims Act (31 U.S.C. 3729 et seq.), shall also apply to the
public health insurance option.
SEC. 227. APPLICATION OF HIPAA INSURANCE REQUIREMENTS.
The requirements of sections 2701 through 2792 of the Public Health
Service Act shall apply to the public health insurance option in the
same manner as they apply to health insurance coverage offered by a
health insurance issuer in the individual market.
SEC. 228. APPLICATION OF HEALTH INFORMATION PRIVACY, SECURITY, AND
ELECTRONIC TRANSACTION REQUIREMENTS.
Part C of title XI of the Social Security Act, relating to standards
for protections against the wrongful disclosure of individually
identifiable health information, health information security, and the
electronic exchange of health care information, shall apply to the
public health insurance option in the same manner as such part applies
to other health plans (as defined in section 1171(5) of such Act).
SEC. 229. ENROLLMENT IN PUBLIC HEALTH INSURANCE OPTION IS VOLUNTARY.
Nothing in this division shall be construed as requiring anyone to
enroll in the public health insurance option. Enrollment in such option
is voluntary.
Subtitle C--Individual Affordability Credits
SEC. 241. AVAILABILITY THROUGH HEALTH INSURANCE EXCHANGE.
(a) In General.--Subject to the succeeding provisions of this
subtitle, in the case of an affordable credit eligible individual
enrolled in an Exchange-participating health benefits plan--
(1) the individual shall be eligible for, in accordance with
this subtitle, affordability credits consisting of--
(A) an affordability premium credit under section 243
to be applied against the premium for the Exchange-
participating health benefits plan in which the
individual is enrolled; and
(B) an affordability cost-sharing credit under
section 244 to be applied as a reduction of the cost-
sharing otherwise applicable to such plan; and
(2) the Commissioner shall pay the QHBP offering entity that
offers such plan from the Health Insurance Exchange Trust Fund
the aggregate amount of affordability credits for all
affordable credit eligible individuals enrolled in such plan.
(b) Application.--
(1) In general.--An Exchange eligible individual may apply to
the Commissioner through the Health Insurance Exchange or
through another entity under an arrangement made with the
Commissioner, in a form and manner specified by the
Commissioner. The Commissioner through the Health Insurance
Exchange or through another public entity under an arrangement
made with the Commissioner shall make a determination as to
eligibility of an individual for affordability credits under
this subtitle. The Commissioner shall establish a process
whereby, on the basis of information otherwise available,
individuals may be deemed to be affordable credit eligible
individuals. In carrying this subtitle, the Commissioner shall
establish effective methods that ensure that individuals with
limited English proficiency are able to apply for affordability
credits.
(2) Use of state medicaid agencies.--If the Commissioner
determines that a State Medicaid agency has the capacity to
make a determination of eligibility for affordability credits
under this subtitle and under the same standards as used by the
Commissioner, under the Medicaid memorandum of understanding
(as defined in section 205(c)(4))--
(A) the State Medicaid agency is authorized to
conduct such determinations for any Exchange-eligible
individual who requests such a determination; and
(B) the Commissioner shall reimburse the State
Medicaid agency for the costs of conducting such
determinations.
(3) Medicaid screen and enroll obligation.--In the case of an
application made under paragraph (1), there shall be a
determination of whether the individual is a Medicaid-eligible
individual. If the individual is determined to be so eligible,
the Commissioner, through the Medicaid memorandum of
understanding, shall provide for the enrollment of the
individual under the State Medicaid plan in accordance with the
Medicaid memorandum of understanding. In the case of such an
enrollment, the State shall provide for the same periodic
redetermination of eligibility under Medicaid as would
otherwise apply if the individual had directly applied for
medical assistance to the State Medicaid agency.
(c) Use of Affordability Credits.--
(1) In general.--In Y1 and Y2 an affordable credit eligible
individual may use an affordability credit only with respect to
a basic plan.
(2) Flexibility in plan enrollment authorized.--Beginning
with Y3, the Commissioner shall establish a process to allow an
affordability credit to be used for enrollees in enhanced or
premium plans. In the case of an affordable credit eligible
individual who enrolls in an enhanced or premium plan, the
individual shall be responsible for any difference between the
premium for such plan and the affordable credit amount
otherwise applicable if the individual had enrolled in a basic
plan.
(3) Prohibition of use of public funds for abortion
coverage.--An affordability credit may not be used for payment
for services described in section 122(d)(4)(A).
(d) Access to Data.--In carrying out this subtitle, the Commissioner
shall request from the Secretary of the Treasury consistent with
section 6103 of the Internal Revenue Code of 1986 such information as
may be required to carry out this subtitle.
(e) No Cash Rebates.--In no case shall an affordable credit eligible
individual receive any cash payment as a result of the application of
this subtitle.
SEC. 242. AFFORDABLE CREDIT ELIGIBLE INDIVIDUAL.
(a) Definition.--
(1) In general.--For purposes of this division, the term
``affordable credit eligible individual'' means, subject to
subsection (b), an individual who is lawfully present in a
State in the United States (other than as a nonimmigrant
described in a subparagraph (excluding subparagraphs (K), (T),
(U), and (V)) of section 101(a)(15) of the Immigration and
Nationality Act)--
(A) who is enrolled under an Exchange-participating
health benefits plan and is not enrolled under such
plan as an employee (or dependent of an employee)
through an employer qualified health benefits plan that
meets the requirements of section 312;
(B) with family income below 400 percent of the
Federal poverty level for a family of the size
involved; and
(C) who is not a Medicaid eligible individual, other
than an individual described in section 202(d)(3) or an
individual during a transition period under section
202(d)(4)(B)(ii).
(2) Treatment of family.--Except as the Commissioner may
otherwise provide, members of the same family who are
affordable credit eligible individuals shall be treated as a
single affordable credit individual eligible for the applicable
credit for such a family under this subtitle.
(3) Equal treatment of certain employed individuals.--
(A) In general.--For purposes of applying this
section with respect to an individual who is an
employee of an employer that has an annual payroll (for
the preceding calendar year) which does not exceed
$750,000 and that makes the contribution which would be
required under section 313(a) if the table specified in
subparagraph (B) were substituted for the table
specified in section 313(b)(1) (and if, in applying
section 313(b)(2), $750,000 were substituted for
$400,000), such individual shall be treated in the same
manner as an employee of an employer that makes the
contribution described in section 313(a) (without
regard to this paragraph).
(B) Table.--The table specified in this subparagraph
is the following:
If the annual payroll of such employer The applicable percentage is:
for the preceding calendar year:
Does not exceed $500,000............. 0 percent
Exceeds $500,000, but does not exceed 2 percent
$585,000.
Exceeds $585,000, but does not exceed 4 percent
$670,000.
Exceeds $670,000, but does not exceed 6 percent
$750,000.
(b) Limitations on Employee and Dependent Disqualification.--
(1) In general.--Subject to paragraph (2), the term
``affordable credit eligible individual'' does not include a
full-time employee of an employer if the employer offers the
employee coverage (for the employee and dependents) as a full-
time employee under a group health plan if the coverage and
employer contribution under the plan meet the requirements of
section 312.
(2) Exceptions.--
(A) For certain family circumstances.--The
Commissioner shall establish such exceptions and
special rules in the case described in paragraph (1) as
may be appropriate in the case of a divorced or
separated individual or such a dependent of an employee
who would otherwise be an affordable credit eligible
individual.
(B) For unaffordable employer coverage.--Beginning in
Y2, in the case of full-time employees for which the
cost of the employee premium for coverage under a group
health plan would exceed 12 percent of current family
income (determined by the Commissioner on the basis of
verifiable documentation and without regard to section
245), paragraph (1) shall not apply.
(c) Income Defined.--
(1) In general.--In this title, the term ``income'' means
modified adjusted gross income (as defined in section 59B of
the Internal Revenue Code of 1986).
(2) Study of income disregards.--The Commissioner shall
conduct a study that examines the application of income
disregards for purposes of this subtitle. Not later than the
first day of Y2, the Commissioner shall submit to Congress a
report on such study and shall include such recommendations as
the Commissioner determines appropriate.
(d) Clarification of Treatment of Affordability Credits.--
Affordability credits under this subtitle shall not be treated, for
purposes of title IV of the Personal Responsibility and Work
Opportunity Reconciliation Act of 1996, to be a benefit provided under
section 403 of such title.
SEC. 243. AFFORDABLE PREMIUM CREDIT.
(a) In General.--The affordability premium credit under this section
for an affordable credit eligible individual enrolled in an Exchange-
participating health benefits plan is in an amount equal to the amount
(if any) by which the premium for the plan (or, if less, the reference
premium amount specified in subsection (c)), exceeds the affordable
premium amount specified in subsection (b) for the individual.
(b) Affordable Premium Amount.--
(1) In general.--The affordable premium amount specified in
this subsection for an individual for monthly premium in a plan
year shall be equal to \1/12\ of the product of--
(A) the premium percentage limit specified in
paragraph (2) for the individual based upon the
individual's family income for the plan year; and
(B) the individual's family income for such plan
year.
(2) Premium percentage limits based on table.--The
Commissioner shall establish premium percentage limits so that
for individuals whose family income is within an income tier
specified in the table in subsection (d) such percentage limits
shall increase, on a sliding scale in a linear manner, from the
initial premium percentage to the final premium percentage
specified in such table for such income tier.
(c) Reference Premium Amount.--The reference premium amount specified
in this subsection for a plan year for an individual in a premium
rating area is equal to the average premium for the 3 basic plans in
the area for the plan year with the lowest premium levels. In computing
such amount the Commissioner may exclude plans with extremely limited
enrollments.
(d) Table of Premium Percentage Limits and Actuarial Value
Percentages Based on Income Tier.--
(1) In general.--For purposes of this subtitle, subject to
paragraphs (3) and (4), the table specified in this subsection
is as follows:
In the case of family income
(expressed as a percent of FPL) The initial premium The final premium The actuarial value
within the following income tier: percentage is-- percentage is-- percentage is--
133% through 150% 1.5% 3.0% 97%
150% through 200% 3.0% 5.5% 93%
200% through 250% 5.5% 8% 85%
250% through 300% 8% 10% 78%
300% through 350% 10% 11% 72%
350% through 400% 11% 12% 70%
(2) Special rules.--For purposes of applying the table under
paragraph (1)--
(A) For lowest level of income.--In the case of an
individual with income that does not exceed 133 percent
of FPL, the individual shall be considered to have
income that is 133% of FPL.
(B) Application of higher actuarial value percentage
at tier transition points.--If two actuarial value
percentages may be determined with respect to an
individual, the actuarial value percentage shall be the
higher of such percentages.
(3) Indexing.--For years after Y1, the Commissioner shall
adjust the initial and final premium percentages to maintain
the ratio of governmental to enrollee shares of premiums over
time, for each income tier identified in the table in paragraph
(1).
(4) Contingent adjustment for additional savings.--
(A) In general.--Before the beginning of each year
beginning with Y2--
(i) the Chief Actuary of the Centers of
Medicare & Medicaid Services shall estimate the
amount of savings in the previous year under
this division resulting from the application of
the provisions described in subparagraph (B)
and shall report such estimate to the
Commissioner; and
(ii) the Commissioner, based upon such
estimate, shall provide for an appropriate
increase in the initial and final premium
percentages in the table specified in paragraph
(1) in a manner that is designed to result in
an increase in aggregate affordability credits
equivalent to the amount so estimated.
(B) Provisions described.--The provisions described
in this subparagraph are as follows:
(i) Formulary under public option.--Section
223(a)(4).
(ii) PBM transparency.--Section 133(d).
(iii) ACO in medicaid.--Section 1730.
(iv) Administrative simplification.--
(I) Section 1173A of the Social
Security Act, as added by section
163(a)(1).
(II) Section 163(c).
(III) Section 164.
(v) Limitation on premium increases in
exchange-participating plans.--Section 209.
(vi) Negotiation of lower part d drug
prices.--Section 1186.
SEC. 244. AFFORDABILITY COST-SHARING CREDIT.
(a) In General.--The affordability cost-sharing credit under this
section for an affordable credit eligible individual enrolled in an
Exchange-participating health benefits plan is in the form of the cost-
sharing reduction described in subsection (b) provided under this
section for the income tier in which the individual is classified based
on the individual's family income.
(b) Cost-sharing Reductions.--The Commissioner shall specify a
reduction in cost-sharing amounts and the annual limitation on cost-
sharing specified in section 122(c)(2)(B) under a basic plan for each
income tier specified in the table under section 243(d), with respect
to a year, in a manner so that, as estimated by the Commissioner, the
actuarial value of the coverage with such reduced cost-sharing amounts
(and the reduced annual cost-sharing limit) is equal to the actuarial
value percentage (specified in the table under section 243(d) for the
income tier involved) of the full actuarial value if there were no
cost-sharing imposed under the plan.
(c) Determination and Payment of Cost-sharing Affordability Credit.--
In the case of an affordable credit eligible individual in a tier
enrolled in an Exchange-participating health benefits plan offered by a
QHBP offering entity, the Commissioner shall provide for payment to the
offering entity of an amount equivalent to the increased actuarial
value of the benefits under the plan provided under section
203(c)(2)(B) resulting from the reduction in cost-sharing described in
subsection (b).
SEC. 245. INCOME DETERMINATIONS.
(a) In General.--In applying this subtitle for an affordability
credit for an individual for a plan year, the individual's income shall
be the income (as defined in section 242(c)) for the individual for the
most recent taxable year (as determined in accordance with rules of the
Commissioner). The Federal poverty level applied shall be such level in
effect as of the date of the application.
(b) Program Integrity; Income Verification Procedures.--
(1) Program integrity.--The Commissioner shall take such
steps as may be appropriate to ensure the accuracy of
determinations and redeterminations under this subtitle.
(2) Income verification.--
(A) In general.--Upon an initial application of an
individual for an affordability credit under this
subtitle (or in applying section 242(b)) or upon an
application for a change in the affordability credit
based upon a significant change in family income
described in subparagraph (A)--
(i) the Commissioner shall request from the
Secretary of the Treasury the disclosure to the
Commissioner of such information as may be
permitted to verify the information contained
in such application; and
(ii) the Commissioner shall use the
information so disclosed to verify such
information.
(B) Alternative procedures.--The Commissioner shall
establish procedures for the verification of income for
purposes of this subtitle if no income tax return is
available for the most recent completed tax year.
(c) Special Rules.--
(1) Changes in income as a percent of fpl.--In the case that
an individual's income (expressed as a percentage of the
Federal poverty level for a family of the size involved) for a
plan year is expected (in a manner specified by the
Commissioner) to be significantly different from the income (as
so expressed) used under subsection (a), the Commissioner shall
establish rules requiring an individual to report, consistent
with the mechanism established under paragraph (2), significant
changes in such income (including a significant change in
family composition) to the Commissioner and requiring the
substitution of such income for the income otherwise
applicable.
(2) Reporting of significant changes in income.--The
Commissioner shall establish rules under which an individual
determined to be an affordable credit eligible individual would
be required to inform the Commissioner when there is a
significant change in the family income of the individual
(expressed as a percentage of the FPL for a family of the size
involved) and of the information regarding such change. Such
mechanism shall provide for guidelines that specify the
circumstances that qualify as a significant change, the
verifiable information required to document such a change, and
the process for submission of such information. If the
Commissioner receives new information from an individual
regarding the family income of the individual, the Commissioner
shall provide for a redetermination of the individual's
eligibility to be an affordable credit eligible individual.
(3) Transition for chip.--In the case of a child described in
section 205(d)(2), the Commissioner shall establish rules under
which the family income of the child is deemed to be no greater
than the family income of the child as most recently determined
before Y1 by the State under title XXI of the Social Security
Act.
(4) Study of geographic variation in application of fpl.--
(A) In general.--The Commissioner shall examine the
feasibility and implication of adjusting the
application of the Federal poverty level under this
subtitle for different geographic areas so as to
reflect the variations in cost-of-living among
different areas within the United States. If the
Commissioner determines that an adjustment is feasible,
the study should include a methodology to make such an
adjustment. Not later than the first day of Y2, the
Commissioner shall submit to Congress a report on such
study and shall include such recommendations as the
Commissioner determines appropriate.
(B) Inclusion of territories.--
(i) In general.--The Commissioner shall
ensure that the study under subparagraph (A)
covers the territories of the United States and
that special attention is paid to the disparity
that exists among poverty levels and the cost
of living in such territories and to the impact
of such disparity on efforts to expand health
coverage and ensure health care.
(ii) Territories defined.-- In this
subparagraph, the term ``territories of the
United States'' includes the Commonwealth of
Puerto Rico, the United States Virgin Islands,
Guam, the Northern Mariana Islands, and any
other territory or possession of the United
States.
(d) Penalties for Misrepresentation.--In the case of an individual
intentionally misrepresents family income or the individual fails
(without regard to intent) to disclose to the Commissioner a
significant change in family income under subsection (c) in a manner
that results in the individual becoming an affordable credit eligible
individual when the individual is not or in the amount of the
affordability credit exceeding the correct amount--
(1) the individual is liable for repayment of the amount of
the improper affordability credit; ;and
(2) in the case of such an intentional misrepresentation or
other egregious circumstances specified by the Commissioner,
the Commissioner may impose an additional penalty.
SEC. 246. NO FEDERAL PAYMENT FOR UNDOCUMENTED ALIENS.
Nothing in this subtitle shall allow Federal payments for
affordability credits on behalf of individuals who are not lawfully
present in the United States.
Subtitle D--Health Insurance Cooperatives
SEC. 251. ESTABLISHMENT.
Not later than 6 months after the date of the enactment of this Act,
the Commissioner, in consultation with the Secretary of the Treasury,
shall establish a Consumer Operated and Oriented Plan program (in this
subtitle referred to as the ``CO-OP program'') under which the
Commissioner may make grants and loans for the establishment and
initial operation of not-for-profit, member-run health insurance
cooperatives (in this subtitle individually referred to as a
``cooperative'') that provide insurance through the Health Insurance
Exchange or a State-based Health Insurance Exchange under section 208.
Nothing in this subtitle shall be construed as requiring a State to
establish such a cooperative.
SEC. 252. START-UP AND SOLVENCY GRANTS AND LOANS.
(a) In General.--Not later than 36 months after the date of the
enactment of this Act, the Commissioner, acting through the CO-OP
program, may make--
(1) loans (of such period and with such terms as the
Secretary may specify) to cooperatives to assist such
cooperatives with start-up costs; and
(2) grants to cooperatives to assist such cooperatives in
meeting State solvency requirements in the States in which such
cooperative offers or issues insurance coverage.
(b) Conditions.--A grant or loan may not be awarded under this
section with respect to a cooperative unless the following conditions
are met:
(1) The cooperative is structured as a not-for-profit, member
organization under the law of each State in which such
cooperative offers, intends to offer, or issues insurance
coverage, with the membership of the cooperative being made up
entirely of beneficiaries of the insurance coverage offered by
such cooperative.
(2) The cooperative did not offer insurance on or before July
16, 2009, and the cooperatives is not an affiliate or successor
to an insurance company offering insurance on or before such
date.
(3) The governing documents of the cooperatives incorporate
ethical and conflict of interest standards designed to protect
against insurance industry involvement and interference in the
governance of the cooperative.
(4) The cooperative is not sponsored by a State government.
(5) Substantially all of the activities of the cooperative
consist of the issuance of qualified health benefit plans
through the Health Insurance Exchange or a State-based health
insurance exchange.
(6) The cooperative is licenced to offer insurance in each
State in which it offers insurance.
(7) The governance of the cooperative must be subject to a
majority vote of its members.
(8) As provided in guidance issued by the Secretary of Health
and Human Services, the cooperative operates with a strong
consumer focus, including timeliness, responsiveness, and
accountability to members.
(9) Any profits made by the cooperative are used to lower
premiums, improve benefits, or to otherwise improve the quality
of health care delivered to members.
(c) Priority.--The Commissioner, in making grants and loans under
this section, shall give priority to cooperatives that--
(1) operate on a Statewide basis;
(2) use an integrated delivery system; or
(3) have a significant level of financial support from non-
governmental sources.
(d) Rules of Construction.--Nothing in this subtitle shall be
construed to prevent a cooperative established in one State from
integrating with a cooperative established in another State the
administration, issuance of coverage, or other activities related to
acting as a QHBP offering entity. Nothing in this subtitle shall be
construed as preventing State governments from taking actions to permit
such integration.
(e) Repayment for Violations of Terms of Program.--If a cooperative
violates the terms of the CO-OP program and fails to correct the
violation within a reasonable period of time, as determined by the
Commissioner, the cooperative shall repay the total amount of any loan
or grant received by such cooperative under this section, plus interest
(at a rate determined by the Secretary).
(f) Authorization of Appropriations.--There are authorized to be
appropriated $5,000,000,000 for the period of fiscal years 2010 through
2014 to provide for grants and loans under this section.
SEC. 253. DEFINITIONS.
For purposes of this subtitle:
(1) State.--The term ``State'' means each of the 50 States
and the District of Columbia.
(2) Member.--The term ``member'', with respect to a
cooperative, means an individual who, after the cooperative
offers health insurance coverage, is enrolled in such coverage.
TITLE III--SHARED RESPONSIBILITY
Subtitle A--Individual Responsibility
SEC. 301. INDIVIDUAL RESPONSIBILITY.
For an individual's responsibility to obtain acceptable coverage, see
section 59B of the Internal Revenue Code of 1986 (as added by section
401 of this Act).
Subtitle B--Employer Responsibility
PART 1--HEALTH COVERAGE PARTICIPATION REQUIREMENTS
SEC. 311. HEALTH COVERAGE PARTICIPATION REQUIREMENTS.
An employer meets the requirements of this section if such employer
does all of the following:
(1) Offer of coverage.--The employer offers each employee
individual and family coverage under a qualified health
benefits plan (or under a current employment-based health plan
(within the meaning of section 102(b))) in accordance with
section 312.
(2) Contribution towards coverage.--If an employee accepts
such offer of coverage, the employer makes timely contributions
towards such coverage in accordance with section 312.
(3) Contribution in lieu of coverage.--Beginning with Y2, if
an employee declines such offer but otherwise obtains coverage
in an Exchange-participating health benefits plan (other than
by reason of being covered by family coverage as a spouse or
dependent of the primary insured), the employer shall make a
timely contribution to the Health Insurance Exchange with
respect to each such employee in accordance with section 313.
SEC. 312. EMPLOYER RESPONSIBILITY TO CONTRIBUTE TOWARDS EMPLOYEE AND
DEPENDENT COVERAGE.
(a) In General.--An employer meets the requirements of this section
with respect to an employee if the following requirements are met:
(1) Offering of coverage.--The employer offers the coverage
described in section 311(1) either through an Exchange-
participating health benefits plan or other than through such a
plan.
(2) Employer required contribution.--The employer timely pays
to the issuer of such coverage an amount not less than the
employer required contribution specified in subsection (b) for
such coverage.
(3) Provision of information.--The employer provides the
Health Choices Commissioner, the Secretary of Labor, the
Secretary of Health and Human Services, and the Secretary of
the Treasury, as applicable, with such information as the
Commissioner may require to ascertain compliance with the
requirements of this section.
(4) Autoenrollment of employees.--The employer provides for
autoenrollment of the employee in accordance with subsection
(c).
(b) Reduction of Employee Premiums Through Minimum Employer
Contribution.--
(1) Full-time employees.--The minimum employer contribution
described in this subsection for coverage of a full-time
employee (and, if any, the employee's spouse and qualifying
children (as defined in section 152(c) of the Internal Revenue
Code of 1986) under a qualified health benefits plan (or
current employment-based health plan) is equal to--
(A) in case of individual coverage, not less than
72.5 percent of the applicable premium (as defined in
section 4980B(f)(4) of such Code, subject to paragraph
(2)) of the lowest cost plan offered by the employer
that is a qualified health benefits plan (or is such
current employment-based health plan); and
(B) in the case of family coverage which includes
coverage of such spouse and children, not less 65
percent of such applicable premium of such lowest cost
plan.
(2) Applicable premium for exchange coverage.--In this
subtitle, the amount of the applicable premium of the lowest
cost plan with respect to coverage of an employee under an
Exchange-participating health benefits plan is the reference
premium amount under section 243(c) for individual coverage
(or, if elected, family coverage) for the premium rating area
in which the individual or family resides.
(3) Minimum employer contribution for employees other than
full-time employees.--In the case of coverage for an employee
who is not a full-time employee, the amount of the minimum
employer contribution under this subsection shall be a
proportion (as determined in accordance with rules of the
Health Choices Commissioner, the Secretary of Labor, the
Secretary of Health and Human Services, and the Secretary of
the Treasury, as applicable) of the minimum employer
contribution under this subsection with respect to a full-time
employee that reflects the proportion of--
(A) the average weekly hours of employment of the
employee by the employer, to
(B) the minimum weekly hours specified by the
Commissioner for an employee to be a full-time
employee.
(4) Salary reductions not treated as employer
contributions.--For purposes of this section, any contribution
on behalf of an employee with respect to which there is a
corresponding reduction in the compensation of the employee
shall not be treated as an amount paid by the employer.
(c) Automatic Enrollment for Employer Sponsored Health Benefits.--
(1) In general.--The requirement of this subsection with
respect to an employer and an employee is that the employer
automatically enroll such employee into the employment-based
health benefits plan for individual coverage under the plan
option with the lowest applicable employee premium.
(2) Opt-out.--In no case may an employer automatically enroll
an employee in a plan under paragraph (1) if such employee
makes an affirmative election to opt out of such plan or to
elect coverage under an employment-based health benefits plan
offered by such employer. An employer shall provide an employee
with a 30-day period to make such an affirmative election
before the employer may automatically enroll the employee in
such a plan.
(3) Notice requirements.--
(A) In general.--Each employer described in paragraph
(1) who automatically enrolls an employee into a plan
as described in such paragraph shall provide the
employees, within a reasonable period before the
beginning of each plan year (or, in the case of new
employees, within a reasonable period before the end of
the enrollment period for such a new employee), written
notice of the employees' rights and obligations
relating to the automatic enrollment requirement under
such paragraph. Such notice must be comprehensive and
understood by the average employee to whom the
automatic enrollment requirement applies.
(B) Inclusion of specific information.--The written
notice under subparagraph (A) must explain an
employee's right to opt out of being automatically
enrolled in a plan and in the case that more than one
level of benefits or employee premium level is offered
by the employer involved, the notice must explain which
level of benefits and employee premium level the
employee will be automatically enrolled in the absence
of an affirmative election by the employee.
SEC. 313. EMPLOYER CONTRIBUTIONS IN LIEU OF COVERAGE.
(a) In General.--A contribution is made in accordance with this
section with respect to an employee if such contribution is equal to an
amount equal to 8 percent of the average wages paid by the employer
during the period of enrollment (determined by taking into account all
employees of the employer and in such manner as the Commissioner
provides, including rules providing for the appropriate aggregation of
related employers). Any such contribution--
(1) shall be paid to the Health Choices Commissioner for
deposit into the Health Insurance Exchange Trust Fund, and
(2) shall not be applied against the premium of the employee
under the Exchange-participating health benefits plan in which
the employee is enrolled.
(b) Special Rules for Small Employers.--
(1) In general.--In the case of any employer who is a small
employer for any calendar year, subsection (a) shall be applied
by substituting the applicable percentage determined in
accordance with the following table for ``8 percent'':
If the annual payroll of such employer The applicable percentage is:
for the preceding calendar year:
Does not exceed $250,000............. 0 percent
Exceeds $250,000, but does not exceed 2 percent
$300,000.
Exceeds $300,000, but does not exceed 4 percent
$350,000.
Exceeds $350,000, but does not exceed 6 percent
$400,000.
(2) Small employer.--For purposes of this subsection, the
term ``small employer'' means any employer for any calendar
year if the annual payroll of such employer for the preceding
calendar year does not exceed $400,000.
(3) Annual payroll.--For purposes of this paragraph, the term
``annual payroll'' means, with respect to any employer for any
calendar year, the aggregate wages paid by the employer during
such calendar year.
(4) Aggregation rules.--Related employers and predecessors
shall be treated as a single employer for purposes of this
subsection.
SEC. 314. AUTHORITY RELATED TO IMPROPER STEERING.
The Health Choices Commissioner (in coordination with the Secretary
of Labor, the Secretary of Health and Human Services, and the Secretary
of the Treasury) shall have authority to set standards for determining
whether employers or insurers are undertaking any actions to affect the
risk pool within the Health Insurance Exchange by inducing individuals
to decline coverage under a qualified health benefits plan (or current
employment-based health plan (within the meaning of section 102(b))
offered by the employer and instead to enroll in an Exchange-
participating health benefits plan. An employer violating such
standards shall be treated as not meeting the requirements of this
section.
PART 2--SATISFACTION OF HEALTH COVERAGE PARTICIPATION REQUIREMENTS
[For sections 321 and 322, see text of bill as introduced on June 14,
2009.]
SEC. 323. SATISFACTION OF HEALTH COVERAGE PARTICIPATION REQUIREMENTS
UNDER THE PUBLIC HEALTH SERVICE ACT.
(a) In General.--Part C of title XXVII of the Public Health Service
Act is amended by adding at the end the following new section:
``SEC. 2793. NATIONAL HEALTH COVERAGE PARTICIPATION REQUIREMENTS.
``(a) Election of Employer to Be Subject to National Health Coverage
Participation Requirements.--
``(1) In general.--An employer may make an election with the
Secretary to be subject to the health coverage participation
requirements.
``(2) Time and manner.--An election under paragraph (1) may
be made at such time and in such form and manner as the
Secretary may prescribe.
``(b) Treatment of Coverage Resulting From Election.--
``(1) In general.--If an employer makes an election to the
Secretary under subsection (a)--
``(A) such election shall be treated as the
establishment and maintenance of a group health plan
for purposes of this title, subject to section 151 of
the America's Affordable Health Choices Act of 2009,
and
``(B) the health coverage participation requirements
shall be deemed to be included as terms and conditions
of such plan.
``(2) Periodic investigations to determine compliance with
health coverage participation requirements.--The Secretary
shall regularly audit a representative sampling of employers
and conduct investigations and other activities with respect to
such sampling of employers so as to discover noncompliance with
the health coverage participation requirements in connection
with such employers (during any period with respect to which an
election under subsection (a) is in effect). The Secretary
shall communicate findings of noncompliance made by the
Secretary under this subsection to the Secretary of the
Treasury and the Health Choices Commissioner. The Secretary
shall take such timely enforcement action as appropriate to
achieve compliance.
``(c) Health Coverage Participation Requirements.--For purposes of
this section, the term `health coverage participation requirements'
means the requirements of part 1 of subtitle B of title III of division
A of the America's Affordable Health Choices Act of 2009 (as in effect
on the date of the enactment of this section).
``(d) Separate Elections.--Under regulations prescribed by the
Secretary, separate elections may be made under subsection (a) with
respect to full-time employees and employees who are not full-time
employees.
``(e) Termination of Election in Cases of Substantial
Noncompliance.--The Secretary may terminate the election of any
employer under subsection (a) if the Secretary (in coordination with
the Health Choices Commissioner) determines that such employer is in
substantial noncompliance with the health coverage participation
requirements and shall refer any such determination to the Secretary of
the Treasury as appropriate.
``(f) Enforcement of Health Coverage Participation Requirements.--
``(1) Civil penalties.--In the case of any employer who fails
(during any period with respect to which the election under
subsection (a) is in effect) to satisfy the health coverage
participation requirements with respect to any employee, the
Secretary may assess a civil penalty against the employer of
$100 for each day in the period beginning on the date such
failure first occurs and ending on the date such failure is
corrected.
``(2) Limitations on amount of penalty.--
``(A) Penalty not to apply where failure not
discovered exercising reasonable diligence.--No penalty
shall be assessed under paragraph (1) with respect to
any failure during any period for which it is
established to the satisfaction of the Secretary that
the employer did not know, or exercising reasonable
diligence would not have known, that such failure
existed.
``(B) Penalty not to apply to failures corrected
within 30 days.--No penalty shall be assessed under
paragraph (1) with respect to any failure if--
``(i) such failure was due to reasonable
cause and not to willful neglect, and
``(ii) such failure is corrected during the
30-day period beginning on the 1st date that
the employer knew, or exercising reasonable
diligence would have known, that such failure
existed.
``(C) Overall limitation for unintentional
failures.--In the case of failures which are due to
reasonable cause and not to willful neglect, the
penalty assessed under paragraph (1) for failures
during any 1-year period shall not exceed the amount
equal to the lesser of--
``(i) 10 percent of the aggregate amount paid
or incurred by the employer (or predecessor
employer) during the preceding taxable year for
group health plans, or
``(ii) $500,000.
``(3) Advance notification of failure prior to assessment.--
Before a reasonable time prior to the assessment of any penalty
under paragraph (1) with respect to any failure by an employer,
the Secretary shall inform the employer in writing of such
failure and shall provide the employer information regarding
efforts and procedures which may be undertaken by the employer
to correct such failure.
``(4) Actions to enforce assessments.--The Secretary may
bring a civil action in any District Court of the United States
to collect any civil penalty under this subsection.
``(5) Coordination with excise tax.--Under regulations
prescribed in accordance with section 324 of the America's
Affordable Health Choices Act of 2009, the Secretary and the
Secretary of the Treasury shall coordinate the assessment of
penalties under paragraph (1) in connection with failures to
satisfy health coverage participation requirements with the
imposition of excise taxes on such failures under section
4980H(b) of the Internal Revenue Code of 1986 so as to avoid
duplication of penalties with respect to such failures.
``(6) Deposit of penalty collected.--Any amount of penalty
collected under this subsection shall be deposited as
miscellaneous receipts in the Treasury of the United States.
``(g) Regulations.--The Secretary may promulgate such regulations as
may be necessary or appropriate to carry out the provisions of this
section, in accordance with section 324(a) of the America's Affordable
Health Choices Act of 2009. The Secretary may promulgate any interim
final rules as the Secretary determines are appropriate to carry out
this section.''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to periods beginning after December 31, 2012.
SEC. 324. ADDITIONAL RULES RELATING TO HEALTH COVERAGE PARTICIPATION
REQUIREMENTS.
(a) Assuring Coordination.--The officers consisting of the Secretary
of Labor, the Secretary of the Treasury, the Secretary of Health and
Human Services, and the Health Choices Commissioner shall ensure,
through the execution of an interagency memorandum of understanding
among such officers, that--
(1) regulations, rulings, and interpretations issued by such
officers relating to the same matter over which two or more of
such officers have responsibility under subpart B of part 6 of
subtitle B of title I of the Employee Retirement Income
Security Act of 1974, section 4980H of the Internal Revenue
Code of 1986, and section 2793 of the Public Health Service Act
are administered so as to have the same effect at all times;
and
(2) coordination of policies relating to enforcing the same
requirements through such officers in order to have a
coordinated enforcement strategy that avoids duplication of
enforcement efforts and assigns priorities in enforcement.
(b) Multiemployer Plans.--In the case of a group health plan that is
a multiemployer plan (as defined in section 3(37) of the Employee
Retirement Income Security Act of 1974), the regulations prescribed in
accordance with subsection (a) by the officers referred to in
subsection (a) shall provide for the application of the health coverage
participation requirements to the plan sponsor and contributing
sponsors of such plan.
[TITLE IV--AMENDMENTS TO INTERNAL REVENUE CODE OF 1986]
[For title IV, see text of bill as introduced on June 14, 2009.]
DIVISION B--MEDICARE AND MEDICAID IMPROVEMENTS
SEC. 1001. TABLE OF CONTENTS OF DIVISION.
The table of contents for this division is as follows:
DIVISION B--MEDICARE AND MEDICAID IMPROVEMENTS
Sec. 1001. Table of contents of division.
TITLE I--IMPROVING HEALTH CARE VALUE
Subtitle A--Provisions Related to Medicare Part A
Part 1--Market Basket Updates
Sec. 1101. Skilled nursing facility payment update.
Sec. 1102. Inpatient rehabilitation facility payment update.
Sec. 1103. Incorporating productivity improvements into market basket
updates that do not already incorporate such improvements.
Part 2--Other Medicare Part A Provisions
Sec. 1111. Payments to skilled nursing facilities.
Sec. 1112. Medicare DSH report and payment adjustments in response to
coverage expansion.
Subtitle B--Provisions Related to Medicare Part B
Part 1--Physicians' Services
Sec. 1121. Sustainable growth rate reform.
Sec. 1122. Misvalued codes under the physician fee schedule.
Sec. 1123. Payments for efficient areas.
Sec. 1124. Modifications to the Physician Quality Reporting Initiative
(PQRI).
Sec. 1125. Adjustment to Medicare payment localities.
Sec. 1126. Resource-based feedback program for physicians in Medicare.
Part 2--Market Basket Updates
Sec. 1131. Incorporating productivity improvements into market basket
updates that do not already incorporate such improvements.
Part 3--Other Provisions
Sec. 1141. Rental and purchase of power-driven wheelchairs.
Sec. 1141A. Election to take ownership, or to decline ownership, of a
certain item of complex durable medical equipment after the 13-month
capped rental period ends.
Sec. 1142. Extension of payment rule for brachytherapy.
Sec. 1143. Home infusion therapy report to congress.
Sec. 1144. Require ambulatory surgical centers (ASCs) to submit cost
data and other data.
Sec. 1145. Treatment of certain cancer hospitals.
Sec. 1146. Medicare Improvement Fund.
Sec. 1147. Payment for imaging services.
Sec. 1148. Durable medical equipment program improvements.
Sec. 1149. MedPAC study and report on bone mass measurement.
Sec. 1149A. Exclusion of customary prompt pay discounts extended to
wholesalers from manufacturer's average sales price for payments for
drugs and biologicals under Medicare part B.
Sec. 1149B. Timely access to postmastectomy items.
Sec. 1149C. Moratorium on Medicare reductions in payment rates for
certain interventional pain management procedures covered under the ASC
fee schedule.
Sec. 1149D. Medicare coverage of services of qualified respiratory
therapists performed under the general supervision of a physician.
Subtitle C--Provisions Related to Medicare Parts A and B
Sec. 1151. Reducing potentially preventable hospital readmissions.
Sec. 1152. Post acute care services payment reform plan and bundling
pilot program.
Sec. 1153. Home health payment update for 2010.
Sec. 1154. Payment adjustments for home health care.
Sec. 1155. Incorporating productivity improvements into market basket
update for home health services.
Sec. 1156. Limitation on Medicare exceptions to the prohibition on
certain physician referrals made to hospitals.
Sec. 1157. Institute of Medicine study of geographic adjustment factors
under Medicare.
Sec. 1158. Revision of Medicare payment systems to address geographic
inequities.
Subtitle D--Medicare Advantage Reforms
Part 1--Payment and Administration
Sec. 1161. Phase-in of payment based on fee-for-service costs.
Sec. 1162. Quality bonus payments.
Sec. 1163. Extension of Secretarial coding intensity adjustment
authority.
Sec. 1164. Simplification of annual beneficiary election periods.
Sec. 1165. Extension of reasonable cost contracts.
Sec. 1166. Limitation of waiver authority for employer group plans.
Sec. 1167. Improving risk adjustment for payments.
Sec. 1168. Elimination of MA Regional Plan Stabilization Fund.
Sec. 1169. Study regarding the effects of calculating Medicare
Advantage payment rates on a regional average of Medicare fee for
service rates.
Part 2--Beneficiary Protections and Anti-Fraud
Sec. 1171. Limitation on cost-sharing for individual health services.
Sec. 1172. Continuous open enrollment for enrollees in plans with
enrollment suspension.
Sec. 1173. Information for beneficiaries on MA plan administrative
costs.
Sec. 1174. Strengthening audit authority.
Sec. 1175. Authority to deny plan bids.
Part 3--Treatment of Special Needs Plans
Sec. 1176. Limitation on enrollment outside open enrollment period of
individuals into chronic care specialized MA plans for special needs
individuals.
Sec. 1177. Extension of authority of special needs plans to restrict
enrollment.
Subtitle E--Improvements to Medicare Part D
Sec. 1181. Elimination of coverage gap.
Sec. 1182. Discounts for certain part D drugs in original coverage gap.
Sec. 1183. Repeal of provision relating to submission of claims by
pharmacies located in or contracting with long-term care facilities.
Sec. 1184. Including costs incurred by AIDS drug assistance programs
and Indian Health Service in providing prescription drugs toward the
annual out-of-pocket threshold under part D.
Sec. 1185. Permitting mid-year changes in enrollment for formulary
changes that adversely impact an enrollee.
Sec. 1186. Negotiation of lower covered part D drug prices on behalf of
Medicare beneficiaries.
Sec. 1187. State certification prior to waiver of licensure
requirements under Medicare prescription drug program.
Subtitle F--Medicare Rural Access Protections
Sec. 1191. Telehealth expansion and enhancements.
Sec. 1192. Extension of outpatient hold harmless provision.
Sec. 1193. Extension of section 508 hospital reclassifications.
Sec. 1194. Extension of geographic floor for work.
Sec. 1195. Extension of payment for technical component of certain
physician pathology services.
Sec. 1196. Extension of ambulance add-ons.
Sec. 1197. Ensuring proportional representation of interests of rural
areas on MedPAC.
TITLE II--MEDICARE BENEFICIARY IMPROVEMENTS
Subtitle A--Improving and Simplifying Financial Assistance for Low
Income Medicare Beneficiaries
Sec. 1201. Improving assets tests for Medicare Savings Program and low-
income subsidy program.
Sec. 1202. Elimination of part D cost-sharing for certain
noninstitutionalized full-benefit dual eligible individuals.
Sec. 1203. Eliminating barriers to enrollment.
Sec. 1204. Enhanced oversight relating to reimbursements for
retroactive low income subsidy enrollment.
Sec. 1205. Intelligent assignment in enrollment.
Sec. 1206. Special enrollment period and automatic enrollment process
for certain subsidy eligible individuals.
Sec. 1207. Application of MA premiums prior to rebate in calculation of
low income subsidy benchmark.
Subtitle B--Reducing Health Disparities
Sec. 1221. Ensuring effective communication in Medicare.
Sec. 1222. Demonstration to promote access for Medicare beneficiaries
with limited-English proficiency by providing reimbursement for
culturally and linguistically appropriate services.
Sec. 1223. IOM report on impact of language access services.
Sec. 1224. Definitions.
Subtitle C--Miscellaneous Improvements
Sec. 1231. Extension of therapy caps exceptions process.
Sec. 1232. Extended months of coverage of immunosuppressive drugs for
kidney transplant patients and other renal dialysis provisions.
Sec. 1233. Advance care planning consultation.
Sec. 1234. Part B special enrollment period and waiver of limited
enrollment penalty for TRICARE beneficiaries.
Sec. 1235. Exception for use of more recent tax year in case of gains
from sale of primary residence in computing part B income-related
premium.
Sec. 1236. Demonstration program on use of patient decisions aids.
TITLE III--PROMOTING PRIMARY CARE, MENTAL HEALTH SERVICES, AND
COORDINATED CARE
Sec. 1301. Accountable Care Organization pilot program.
Sec. 1302. Medical home pilot program.
Sec. 1303. Independence at home pilot program.
Sec. 1304. Payment incentive for selected primary care services.
Sec. 1305. Increased reimbursement rate for certified nurse-midwives.
Sec. 1306. Coverage and waiver of cost-sharing for preventive services.
Sec. 1307. Waiver of deductible for colorectal cancer screening tests
regardless of coding, subsequent diagnosis, or ancillary tissue
removal.
Sec. 1308. Excluding clinical social worker services from coverage
under the Medicare skilled nursing facility prospective payment system
and consolidated payment.
Sec. 1309. Coverage of marriage and family therapist services and
mental health counselor services.
Sec. 1310. Extension of physician fee schedule mental health add-on.
Sec. 1311. Expanding access to vaccines.
Sec. 1312. Recognition of certified diabetes educators as certified
providers for purposes of Medicare diabetes outpatient self-management
training services.
TITLE IV--QUALITY
Subtitle A--Comparative Effectiveness Research
Sec. 1401. Comparative effectiveness research.
Subtitle B--Nursing Home Transparency
Part 1--Improving Transparency of Information on Skilled Nursing
Facilities and Nursing Facilities
Sec. 1411. Required disclosure of ownership and additional disclosable
parties information.
Sec. 1412. Accountability requirements.
Sec. 1413. Nursing home compare Medicare website.
Sec. 1414. Reporting of expenditures.
Sec. 1415. Standardized complaint form.
Sec. 1416. Ensuring staffing accountability.
Part 2--Targeting Enforcement
Sec. 1421. Civil money penalties.
Sec. 1422. National independent monitor pilot program.
Sec. 1423. Notification of facility closure.
Part 3--Improving Staff Training
Sec. 1431. Dementia and abuse prevention training.
Sec. 1432. Study and report on training required for certified nurse
aides and supervisory staff.
Sec. 1433. Qualification of director of food services of a Medicaid
nursing facility.
Subtitle C--Quality Measurements
Sec. 1441. Establishment of national priorities for quality
improvement.
Sec. 1442. Development of new quality measures; GAO evaluation of data
collection process for quality measurement.
Sec. 1443. Multistakeholder prerulemaking input into selection of
quality measures.
Sec. 1444. Application of quality measures.
Sec. 1445. Consensus-based entity funding.
Sec. 1446. Quality indicators for care of people with Alzheimer's
disease.
Sec. 1447. Study on five star quality rating system.
Subtitle D--Physician Payments Sunshine Provision
Sec. 1451. Reports on financial relationships between manufacturers and
distributors of covered drugs, devices, biologicals, or medical
supplies under Medicare, Medicaid, or CHIP and physicians and other
health care entities and between physicians and other health care
entities.
Subtitle E--Public Reporting on Health Care-Associated Infections
Sec. 1461. Requirement for public reporting by hospitals and ambulatory
surgical centers on health care-associated infections.
TITLE V--MEDICARE GRADUATE MEDICAL EDUCATION
Sec. 1501. Distribution of unused residency positions.
Sec. 1502. Increasing training in nonprovider settings.
Sec. 1503. Rules for counting resident time for didactic and scholarly
activities and other activities.
Sec. 1504. Preservation of resident cap positions from closed
hospitals.
Sec. 1505. Improving accountability for approved medical residency
training.
TITLE VI--PROGRAM INTEGRITY
Subtitle A--Increased Funding To Fight Waste, Fraud, and Abuse
Sec. 1601. Increased funding and flexibility to fight fraud and abuse.
Subtitle B--Enhanced Penalties for Fraud and Abuse
Sec. 1611. Enhanced penalties for false statements on provider or
supplier enrollment applications.
Sec. 1612. Enhanced penalties for submission of false statements
material to a false claim.
Sec. 1613. Enhanced penalties for delaying inspections.
Sec. 1614. Enhanced hospice program safeguards.
Sec. 1615. Enhanced penalties for individuals excluded from program
participation.
Sec. 1616. Enhanced penalties for provision of false information by
Medicare Advantage and part D plans.
Sec. 1617. Enhanced penalties for Medicare Advantage and part D
marketing violations.
Sec. 1618. Enhanced penalties for obstruction of program audits.
Sec. 1619. Exclusion of certain individuals and entities from
participation in Medicare and State health care programs.
Subtitle C--Enhanced Program and Provider Protections
Sec. 1631. Enhanced CMS program protection authority.
Sec. 1632. Enhanced Medicare, Medicaid, and CHIP program disclosure
requirements relating to previous affiliations.
Sec. 1633. Required inclusion of payment modifier for certain
evaluation and management services.
Sec. 1634. Evaluations and reports required under Medicare Integrity
Program.
Sec. 1635. Require providers and suppliers to adopt programs to reduce
waste, fraud, and abuse.
Sec. 1636. Maximum period for submission of Medicare claims reduced to
not more than 12 months.
Sec. 1637. Physicians who order durable medical equipment or home
health services required to be Medicare-enrolled physicians or eligible
professionals.
Sec. 1638. Requirement for physicians to provide documentation on
referrals to programs at high risk of waste and abuse.
Sec. 1639. Face-to-face encounter with patient required before
physicians may certify eligibility for home health services or durable
medical equipment under Medicare.
Sec. 1640. Extension of testimonial subpoena authority to program
exclusion investigations.
Sec. 1641. Required repayments of Medicare and Medicaid overpayments.
Sec. 1642. Expanded application of hardship waivers for OIG exclusions
to beneficiaries of any Federal health care program.
Sec. 1643. Access to certain information on renal dialysis facilities.
Sec. 1644. Billing agents, clearinghouses, or other alternate payees
required to register under Medicare.
Sec. 1645. Conforming civil monetary penalties to False Claims Act
amendments.
Subtitle D--Access to Information Needed To Prevent Fraud, Waste, and
Abuse
Sec. 1651. Access to information necessary to identify fraud, waste,
and abuse.
Sec. 1652. Elimination of duplication between the Healthcare Integrity
and Protection Data Bank and the National Practitioner Data Bank.
Sec. 1653. Compliance with HIPAA privacy and security standards.
TITLE VII--MEDICAID AND CHIP
Subtitle A--Medicaid and Health Reform
Sec. 1701. Eligibility for individuals with income below 133\1/3\
percent of the Federal poverty level.
Sec. 1702. Requirements and special rules for certain Medicaid
eligible individuals.
Sec. 1703. CHIP and Medicaid maintenance of eligibility.
Sec. 1704. Reduction in Medicaid DSH.
Sec. 1705. Expanded outstationing.
Subtitle B--Prevention
Sec. 1711. Required coverage of preventive services.
Sec. 1712. Tobacco cessation.
Sec. 1713. Optional coverage of nurse home visitation services.
Sec. 1714. State eligibility option for family planning services.
Subtitle C--Access
Sec. 1721. Payments to primary care practitioners.
Sec. 1722. Medical home pilot program.
Sec. 1723. Translation or interpretation services.
Sec. 1724. Optional coverage for freestanding birth center services.
Sec. 1725. Inclusion of public health clinics under the vaccines for
children program.
Sec. 1726. Requiring coverage of services of podiatrists.
Sec. 1726A. Requiring coverage of services of optometrists.
Sec. 1727. Therapeutic foster care.
Sec. 1728. Assuring adequate payment levels for services.
Sec. 1729. Preserving Medicaid coverage for youths upon release from
public institutions.
Sec. 1730. Quality measures for maternity and adult health services
under Medicaid and CHIP.
Sec. 1730A. Accountable care organization pilot program.
Subtitle D--Coverage
Sec. 1731. Optional Medicaid coverage of low-income HIV-infected
individuals.
Sec. 1732. Extending transitional Medicaid Assistance (TMA).
Sec. 1733. Requirement of 12-month continuous coverage under certain
CHIP programs.
Sec. 1734. Preventing the application under CHIP of coverage waiting
periods for certain children.
Sec. 1735. Adult day health care services.
Sec. 1736. Medicaid coverage for citizens of Freely Associated States.
Sec. 1737. Continuing requirement of Medicaid coverage of nonemergency
transportation to medically necessary services.
Sec. 1738. State option to disregard certain income in providing
continued Medicaid coverage for certain individuals with extremely high
prescription costs.
Subtitle E--Financing
Sec. 1741. Payments to pharmacists.
Sec. 1742. Prescription drug rebates.
Sec. 1743. Extension of prescription drug discounts to enrollees of
Medicaid managed care organizations.
Sec. 1744. Payments for graduate medical education.
Sec. 1745. Report on Medicaid payments.
Sec. 1746. Reviews of Medicaid.
Sec. 1747. Extension of delay in managed care organization provider tax
elimination.
Subtitle F--Waste, Fraud, and Abuse
Sec. 1751. Health care acquired conditions.
Sec. 1752. Evaluations and reports required under Medicaid Integrity
Program.
Sec. 1753. Require providers and suppliers to adopt programs to reduce
waste, fraud, and abuse.
Sec. 1754. Overpayments.
Sec. 1755. Managed care organizations.
Sec. 1756. Termination of provider participation under Medicaid and
CHIP if terminated under Medicare or other State plan or child health
plan.
Sec. 1757. Medicaid and CHIP exclusion from participation relating to
certain ownership, control, and management affiliations.
Sec. 1758. Requirement to report expanded set of data elements under
MMIS to detect fraud and abuse.
Sec. 1759. Billing agents, clearinghouses, or other alternate payees
required to register under Medicaid.
Sec. 1760. Denial of payments for litigation-related misconduct.
Sec. 1761. Mandatory State use of national correct coding initiative.
Subtitle G--Payments to the Territories
Sec. 1771. Payment to territories.
Subtitle H--Miscellaneous
Sec. 1781. Technical corrections.
Sec. 1782. Extension of QI program.
Sec. 1783. Outreach and enrollment of Medicaid and CHIP eligible
individuals.
Sec. 1784. Prohibitions on Federal Medicaid and CHIP payment for
undocumented aliens.
Sec. 1785. Demonstration project for stabilization of emergency medical
conditions by nonpublicly owned or operated institutions for mental
diseases.
TITLE VIII--REVENUE-RELATED PROVISIONS
Sec. 1801. Disclosures to facilitate identification of individuals
likely to be ineligible for the low-income assistance under the
Medicare prescription drug program to assist Social Security
Administration's outreach to eligible individuals.
Sec. 1802. Comparative Effectiveness Research Trust Fund; financing for
Trust Fund.
TITLE IX--MISCELLANEOUS PROVISIONS
Sec. 1901. Repeal of trigger provision.
Sec. 1902. Repeal of comparative cost adjustment (CCA) program.
Sec. 1903. Extension of gainsharing demonstration.
Sec. 1904. Grants to States for quality home visitation programs for
families with young children and families expecting children.
Sec. 1905. Improved coordination and protection for dual eligibles.
Sec. 1906. Standardized marketing requirements under the Medicare
Advantage and Medicare prescription drug programs.
Sec. 1907. NAIC recommendations on the establishment of standardized
benefit packages for Medicare Advantage plans and prescription drug
plans.
Sec. 1908. Application of emergency services laws.
Sec. 1909. Nationwide program for national and State background checks
on direct patient access employees of long-term care facilities and
providers.
Sec. 1910. Establishment of Center for Medicare and Medicaid Payment
Innovation within CMS.
TITLE I--IMPROVING HEALTH CARE VALUE
[Subtitle A--Provisions Related to Medicare Part A]
[For subtitle A of title I of division B, see text of bill as
introduced on June 14, 2009.]
Subtitle B--Provisions Related to Medicare Part B
PART 1--PHYSICIANS' SERVICES
SEC. 1121. SUSTAINABLE GROWTH RATE REFORM.
(a) Transitional Update for 2010.--Section 1848(d) of the Social
Security Act (42 U.S.C. 1395w-4(d)) is amended by adding at the end the
following new paragraph:
``(10) Update for 2010.--The update to the single conversion
factor established in paragraph (1)(C) for 2010 shall be the
percentage increase in the MEI (as defined in section
1842(i)(3)) for that year.''.
(b) Rebasing SGR Using 2009; Limitation on Cumulative Adjustment
Period.--Section 1848(d)(4) of such Act (42 U.S.C. 1395w-4(d)(4)) is
amended--
(1) in subparagraph (B), by striking ``subparagraph (D)'' and
inserting ``subparagraphs (D) and (G)''; and
(2) by adding at the end the following new subparagraph:
``(G) Rebasing using 2009 for future update
adjustments.--In determining the update adjustment
factor under subparagraph (B) for 2011 and subsequent
years--
``(i) the allowed expenditures for 2009 shall
be equal to the amount of the actual
expenditures for physicians' services during
2009; and
``(ii) the reference in subparagraph
(B)(ii)(I) to `April 1, 1996' shall be treated
as a reference to `January 1, 2009 (or, if
later, the first day of the fifth year before
the year involved)'.''.
(c) Limitation on Physicians' Services Included in Target Growth Rate
Computation to Services Covered Under Physician Fee Schedule.--
Effective for services furnished on or after January 1, 2009, section
1848(f)(4)(A) of such Act is amended by striking ``(such as clinical''
and all that follows through ``in a physician's office'' and inserting
``for which payment under this part is made under the fee schedule
under this section, for services for practitioners described in section
1842(b)(18)(C) on a basis related to such fee schedule, or for services
described in section 1861(p) (other than such services when furnished
in the facility of a provider of services)''.
(d) Establishment of Separate Target Growth Rates for Categories of
Services.--
(1) Establishment of service categories.--Subsection (j) of
section 1848 of the Social Security Act (42 U.S.C. 1395w-4) is
amended by adding at the end the following new paragraph:
``(5) Service categories.--For services furnished on or after
January 1, 2009, each of the following categories of
physicians' services (as defined in paragraph (3)) shall be
treated as a separate `service category':
``(A) Evaluation and management services that are
procedure codes (for services covered under this title)
for--
``(i) services in the category designated
Evaluation and Management in the Health Care
Common Procedure Coding System (established by
the Secretary under subsection (c)(5) as of
December 31, 2009, and as subsequently modified
by the Secretary); and
``(ii) preventive services (as defined in
section 1861(iii)) for which payment is made
under this section.
``(B) All other services not described in
subparagraph (A).
Service categories established under this paragraph shall apply
without regard to the specialty of the physician furnishing the
service.''.
(2) Establishment of separate conversion factors for each
service category.--Subsection (d)(1) of section 1848 of the
Social Security Act (42 U.S.C. 1395w-4) is amended--
(A) in subparagraph (A)--
(i) by designating the sentence beginning
``The conversion factor'' as clause (i) with
the heading ``Application of single conversion
factor.--'' and with appropriate indentation;
(ii) by striking ``The conversion factor''
and inserting ``Subject to clause (ii), the
conversion factor''; and
(iii) by adding at the end the following new
clause:
``(ii) Application of multiple conversion
factors beginning with 2011.--
``(I) In general.--In applying clause
(i) for years beginning with 2011,
separate conversion factors shall be
established for each service category
of physicians' services (as defined in
subsection (j)(5)) and any reference in
this section to a conversion factor for
such years shall be deemed to be a
reference to the conversion factor for
each of such categories.
``(II) Initial conversion factors.--
Such factors for 2011 shall be based
upon the single conversion factor for
the previous year multiplied by the
update established under paragraph (11)
for such category for 2011.
``(III) Updating of conversion
factors.--Such factor for a service
category for a subsequent year shall be
based upon the conversion factor for
such category for the previous year and
adjusted by the update established for
such category under paragraph (11) for
the year involved.''; and
(B) in subparagraph (D), by striking ``other
physicians' services'' and inserting ``physicians'
services described in the service category described in
subsection (j)(5)(B)''.
(3) Establishing updates for conversion factors for service
categories.--Section 1848(d) of the Social Security Act (42
U.S.C. 1395w-4(d)), as amended by subsection (a), is amended--
(A) in paragraph (4)(C)(iii), by striking ``The
allowed'' and inserting ``Subject to paragraph (11)(B),
the allowed''; and
(B) by adding at the end the following new paragraph:
``(11) Updates for service categories beginning with 2011.--
``(A) In general.--In applying paragraph (4) for a
year beginning with 2011, the following rules apply:
``(i) Application of separate update
adjustments for each service category.--
Pursuant to paragraph (1)(A)(ii)(I), the update
shall be made to the conversion factor for each
service category (as defined in subsection
(j)(5)) based upon an update adjustment factor
for the respective category and year and the
update adjustment factor shall be computed, for
a year, separately for each service category.
``(ii) Computation of allowed and actual
expenditures based on service categories.--In
computing the prior year adjustment component
and the cumulative adjustment component under
clauses (i) and (ii) of paragraph (4)(B), the
following rules apply:
``(I) Application based on service
categories.--The allowed expenditures
and actual expenditures shall be the
allowed and actual expenditures for the
service category, as determined under
subparagraph (B).
``(II) Application of category
specific target growth rate.--The
growth rate applied under clause
(ii)(II) of such paragraph shall be the
target growth rate for the service
category involved under subsection
(f)(5).
``(B) Determination of allowed expenditures.--In
applying paragraph (4) for a year beginning with 2010,
notwithstanding subparagraph (C)(iii) of such
paragraph, the allowed expenditures for a service
category for a year is an amount computed by the
Secretary as follows:
``(i) For 2010.--For 2010:
``(I) Total 2009 actual expenditures
for all services included in sgr
computation for each service
category.--Compute total actual
expenditures for physicians' services
(as defined in subsection (f)(4)(A))
for 2009 for each service category.
``(II) Increase by growth rate to
obtain 2010 allowed expenditures for
service category.--Compute allowed
expenditures for the service category
for 2010 by increasing the allowed
expenditures for the service category
for 2009 computed under subclause (I)
by the target growth rate for such
service category under subsection (f)
for 2010.
``(ii) For subsequent years.--For a
subsequent year, take the amount of allowed
expenditures for such category for the
preceding year (under clause (i) or this
clause) and increase it by the target growth
rate determined under subsection (f) for such
category and year.''.
(4) Application of separate target growth rates for each
category.--
(A) In general.--Section 1848(f) of the Social
Security Act (42 U.S.C. 1395w-4(f)) is amended by
adding at the end the following new paragraph:
``(5) Application of separate target growth rates for each
service category beginning with 2010.--The target growth rate
for a year beginning with 2010 shall be computed and applied
separately under this subsection for each service category (as
defined in subsection (j)(5)) and shall be computed using the
same method for computing the target growth rate except that
the factor described in paragraph (2)(C) for--
``(A) the service category described in subsection
(j)(5)(A) shall be increased by 0.02; and
``(B) the service category described in subsection
(j)(5)(B) shall be increased by 0.01.''.
(B) Use of target growth rates.--Section 1848 of such
Act is further amended--
(i) in subsection (d)--
(I) in paragraph (1)(E)(ii), by
inserting ``or target'' after
``sustainable''; and
(II) in paragraph (4)(B)(ii)(II), by
inserting ``or target'' after
``sustainable''; and
(ii) in the heading of subsection (f), by
inserting ``and Target Growth Rate'' after
``Sustainable Growth Rate'';
(iii) in subsection (f)(1)--
(I) by striking ``and'' at the end of
subparagraph (A);
(II) in subparagraph (B), by
inserting ``before 2010'' after ``each
succeeding year'' and by striking the
period at the end and inserting ``;
and''; and
(III) by adding at the end the
following new subparagraph:
``(C) November 1 of each succeeding year the target
growth rate for such succeeding year and each of the 2
preceding years.''; and
(iv) in subsection (f)(2), in the matter
before subparagraph (A), by inserting after
``beginning with 2000'' the following: ``and
ending with 2009''.
(e) Application to Accountable Care Organization Pilot Program.--In
applying the target growth rate under subsections (d) and (f) of
section 1848 of the Social Security Act to services furnished by a
practitioner to beneficiaries who are attributable to an accountable
care organization under the pilot program provided under section 1866D
of such Act, the Secretary of Health and Human Services shall develop,
not later than January 1, 2012, for application beginning with 2012, a
method that--
(1) allows each such organization to have its own expenditure
targets and updates for such practitioners, with respect to
beneficiaries who are attributable to that organization, that
are consistent with the methodologies described in such
subsection (f); and
(2) provides that the target growth rate applicable to other
physicians shall not apply to such physicians to the extent
that the physicians' services are furnished through the
accountable care organization.
In applying paragraph (1), the Secretary of Health and Human Services
may apply the difference in the update under such paragraph on a claim-
by-claim or lump sum basis and such a payment shall be taken into
account under the pilot program.
SEC. 1122. MISVALUED CODES UNDER THE PHYSICIAN FEE SCHEDULE.
(a) In General.--Section 1848(c)(2) of the Social Security Act (42
U.S.C. 1395w-4(c)(2)) is amended by adding at the end the following new
subparagraphs:
``(K) Potentially misvalued codes.--
``(i) In general.--The Secretary shall--
``(I) periodically identify services
as being potentially misvalued using
criteria specified in clause (ii); and
``(II) review and make appropriate
adjustments to the relative values
established under this paragraph for
services identified as being
potentially misvalued under subclause
(I).
``(ii) Identification of potentially
misvalued codes.--For purposes of identifying
potentially misvalued services pursuant to
clause (i)(I), the Secretary shall examine (as
the Secretary determines to be appropriate)
codes (and families of codes as appropriate)
for which there has been the fastest growth;
codes (and families of codes as appropriate)
that have experienced substantial changes in
practice expenses; codes for new technologies
or services within an appropriate period (such
as three years) after the relative values are
initially established for such codes; multiple
codes that are frequently billed in conjunction
with furnishing a single service; codes with
low relative values, particularly those that
are often billed multiple times for a single
treatment; codes which have not been subject to
review since the implementation of the RBRVS
(the so-called `Harvard-valued codes'); and
such other codes determined to be appropriate
by the Secretary.
``(iii) Review and adjustments.--
``(I) The Secretary may use existing
processes to receive recommendations on
the review and appropriate adjustment
of potentially misvalued services
described clause (i)(II).
``(II) The Secretary may conduct
surveys, other data collection
activities, studies, or other analyses
as the Secretary determines to be
appropriate to facilitate the review
and appropriate adjustment described in
clause (i)(II).
``(III) The Secretary may use
analytic contractors to identify and
analyze services identified under
clause (i)(I), conduct surveys or
collect data, and make recommendations
on the review and appropriate
adjustment of services described in
clause (i)(II).
``(IV) The Secretary may coordinate
the review and appropriate adjustment
described in clause (i)(II) with the
periodic review described in
subparagraph (B).
``(V) As part of the review and
adjustment described in clause (i)(II),
including with respect to codes with
low relative values described in clause
(ii), the Secretary may make
appropriate coding revisions (including
using existing processes for
consideration of coding changes) which
may include consolidation of individual
services into bundled codes for payment
under the fee schedule under subsection
(b).
``(VI) The provisions of subparagraph
(B)(ii)(II) shall apply to adjustments
to relative value units made pursuant
to this subparagraph in the same manner
as such provisions apply to adjustments
under subparagraph (B)(ii)(II).
``(L) Validating relative value units.--
``(i) In general.--The Secretary shall
establish a process to validate relative value
units under the fee schedule under subsection
(b).
``(ii) Components and elements of work.--The
process described in clause (i) may include
validation of work elements (such as time,
mental effort and professional judgment,
technical skill and physical effort, and stress
due to risk) involved with furnishing a service
and may include validation of the pre, post,
and intra-service components of work.
``(iii) Scope of codes.--The validation of
work relative value units shall include a
sampling of codes for services that is the same
as the codes listed under subparagraph (K)(ii)
``(iv) Methods.--The Secretary may conduct
the validation under this subparagraph using
methods described in subclauses (I) through (V)
of subparagraph (K)(iii) as the Secretary
determines to be appropriate.
``(v) Adjustments.--The Secretary shall make
appropriate adjustments to the work relative
value units under the fee schedule under
subsection (b). The provisions of subparagraph
(B)(ii)(II) shall apply to adjustments to
relative value units made pursuant to this
subparagraph in the same manner as such
provisions apply to adjustments under
subparagraph (B)(ii)(II).''.
(b) Implementation.--
(1) Funding.--For purposes of carrying out the provisions of
subparagraphs (K) and (L) of 1848(c)(2) of the Social Security
Act, as added by subsection (a), in addition to funds otherwise
available, out of any funds in the Treasury not otherwise
appropriated, there are appropriated to the Secretary of Health
and Human Services for the Center for Medicare & Medicaid
Services Program Management Account $20,000,000 for fiscal year
2010 and each subsequent fiscal year. Amounts appropriated
under this paragraph for a fiscal year shall be available until
expended.
(2) Administration.--
(A) Chapter 35 of title 44, United States Code and
the provisions of the Federal Advisory Committee Act (5
U.S.C. App.) shall not apply to this section or the
amendment made by this section.
(B) Notwithstanding any other provision of law, the
Secretary may implement subparagraphs (K) and (L) of
1848(c)(2) of the Social Security Act, as added by
subsection (a), by program instruction or otherwise.
(C) Section 4505(d) of the Balanced Budget Act of
1997 is repealed.
(D) Except for provisions related to confidentiality
of information, the provisions of the Federal
Acquisition Regulation shall not apply to this section
or the amendment made by this section.
(3) Focusing cms resources on potentially overvalued codes.--
Section 1868(a) of the Social Security Act (42 1395ee(a)) is
repealed.
SEC. 1123. PAYMENTS FOR EFFICIENT AREAS.
Section 1833 of the Social Security Act (42 U.S.C. 1395l) is amended
by adding at the end the following new subsection:
``(x) Incentive Payments for Efficient Areas.--
``(1) In general.--In the case of services furnished under
the physician fee schedule under section 1848 on or after
January 1, 2011, and before January 1, 2013, by a supplier that
is paid under such fee schedule in an efficient area (as
identified under paragraph (2)), in addition to the amount of
payment that would otherwise be made for such services under
this part, there also shall be paid (on a monthly or quarterly
basis) an amount equal to 5 percent of the payment amount for
the services under this part.
``(2) Identification of efficient areas.--
``(A) In general.--Based upon available data, the
Secretary shall identify those counties or equivalent
areas in the United States in the lowest fifth
percentile of utilization based on per capita spending
under this part and part A for services provided in the
most recent year for which data are available as of the
date of the enactment of this subsection, as
standardized to eliminate the effect of geographic
adjustments in payment rates.
``(B) Identification of counties where service is
furnished..--For purposes of paying the additional
amount specified in paragraph (1), if the Secretary
uses the 5-digit postal ZIP Code where the service is
furnished, the dominant county of the postal ZIP Code
(as determined by the United States Postal Service, or
otherwise) shall be used to determine whether the
postal ZIP Code is in a county described in
subparagraph (A).
``(C) Limitation on review.--There shall be no
administrative or judicial review under section 1869,
1878, or otherwise, respecting--
``(i) the identification of a county or other
area under subparagraph (A); or
``(ii) the assignment of a postal ZIP Code to
a county or other area under subparagraph (B).
``(D) Publication of list of counties; posting on
website.--With respect to a year for which a county or
area is identified under this paragraph, the Secretary
shall identify such counties or areas as part of the
proposed and final rule to implement the physician fee
schedule under section 1848 for the applicable year.
The Secretary shall post the list of counties
identified under this paragraph on the Internet website
of the Centers for Medicare & Medicaid Services.''.
SEC. 1124. MODIFICATIONS TO THE PHYSICIAN QUALITY REPORTING INITIATIVE
(PQRI).
(a) Feedback.--Section 1848(m)(5) of the Social Security Act (42
U.S.C. 1395w-4(m)(5)) is amended by adding at the end the following new
subparagraph:
``(H) Feedback.--The Secretary shall provide timely
feedback to eligible professionals on the performance
of the eligible professional with respect to
satisfactorily submitting data on quality measures
under this subsection.''.
(b) Appeals.--Such section is further amended--
(1) in subparagraph (E), by striking ``There shall be'' and
inserting ``Subject to subparagraph (I), there shall be''; and
(2) by adding at the end the following new subparagraph:
``(I) Informal appeals process.--Notwithstanding
subparagraph (E), by not later than January 1, 2011,
the Secretary shall establish and have in place an
informal process for eligible professionals to appeal
the determination that an eligible professional did not
satisfactorily submit data on quality measures under
this subsection.''.
(c) Integration of Physician Quality Reporting and EHR Reporting.--
Section 1848(m) of such Act is amended by adding at the end the
following new paragraph:
``(7) Integration of physician quality reporting and ehr
reporting.--Not later than January 1, 2012, the Secretary shall
develop a plan to integrate clinical reporting on quality
measures under this subsection with reporting requirements
under subsection (o) relating to the meaningful use of
electronic health records. Such integration shall consist of
the following:
``(A) The development of measures, the reporting of
which would both demonstrate--
``(i) meaningful use of an electronic health
record for purposes of subsection (o); and
``(ii) clinical quality of care furnished to
an individual.
``(B) The collection of health data to identify
deficiencies in the quality and coordination of care
for individuals eligible for benefits under this part.
``(C) Such other activities as specified by the
Secretary.''.
(d) Extension of Incentive Payments.--Section 1848(m)(1) of such Act
(42 U.S.C. 1395w-4(m)(1)) is amended--
(1) in subparagraph (A), by striking ``2010'' and inserting
``2012''; and
(2) in subparagraph (B)(ii), by striking ``2009 and 2010''
and inserting ``each of the years 2009 through 2012''.
SEC. 1125. ADJUSTMENT TO MEDICARE PAYMENT LOCALITIES.
(a) In General.--Section 1848(e) of the Social Security Act (42
U.S.C.1395w-4(e)) is amended by adding at the end the following new
paragraph:
``(6) Transition to use of msas as fee schedule areas in
california.--
``(A) In general.--
``(i) Revision.--Subject to clause (ii) and
notwithstanding the previous provisions of this
subsection, for services furnished on or after
January 1, 2011, the Secretary shall revise the
fee schedule areas used for payment under this
section applicable to the State of California
using the Metropolitan Statistical Area (MSA)
iterative Geographic Adjustment Factor
methodology as follows:
``(I) The Secretary shall configure
the physician fee schedule areas using
the Core-Based Statistical Areas-
Metropolitan Statistical Areas (each in
this paragraph referred to as an
`MSA'), as defined by the Director of
the Office of Management and Budget, as
the basis for the fee schedule areas.
The Secretary shall employ an iterative
process to transition fee schedule
areas. First, the Secretary shall list
all MSAs within the State by Geographic
Adjustment Factor described in
paragraph (2) (in this paragraph
referred to as a `GAF') in descending
order. In the first iteration, the
Secretary shall compare the GAF of the
highest cost MSA in the State to the
weighted-average GAF of the group of
remaining MSAs in the State. If the
ratio of the GAF of the highest cost
MSA to the weighted-average GAF of the
rest of State is 1.05 or greater then
the highest cost MSA becomes a separate
fee schedule area.
``(II) In the next iteration, the
Secretary shall compare the MSA of the
second-highest GAF to the weighted-
average GAF of the group of remaining
MSAs. If the ratio of the second-
highest MSA's GAF to the weighted-
average of the remaining lower cost
MSAs is 1.05 or greater, the second-
highest MSA becomes a separate fee
schedule area. The iterative process
continues until the ratio of the GAF of
the highest-cost remaining MSA to the
weighted-average of the remaining
lower-cost MSAs is less than 1.05, and
the remaining group of lower cost MSAs
form a single fee schedule area. If two
MSAs have identical GAFs, they shall be
combined in the iterative comparison.
``(ii) Transition.--For services furnished on
or after January 1, 2011, and before January 1,
2016, in the State of California, after
calculating the work, practice expense, and
malpractice geographic indices described in
clauses (i), (ii), and (iii) of paragraph
(1)(A) that would otherwise apply through
application of this paragraph, the Secretary
shall increase any such index to the county-
based fee schedule area value on December 31,
2009, if such index would otherwise be less
than the value on January 1, 2010.
``(B) Subsequent revisions.--
``(i) Periodic review and adjustments in fee
schedule areas.--Subsequent to the process
outlined in paragraph (1)(C), not less often
than every three years, the Secretary shall
review and update the California Rest-of-State
fee schedule area using MSAs as defined by the
Director of the Office of Management and Budget
and the iterative methodology described in
subparagraph (A)(i).
``(ii) Link with geographic index data
revision.--The revision described in clause (i)
shall be made effective concurrently with the
application of the periodic review of the
adjustment factors required under paragraph
(1)(C) for California for 2012 and subsequent
periods. Upon request, the Secretary shall make
available to the public any county-level or MSA
derived data used to calculate the geographic
practice cost index.
``(C) References to fee schedule areas.--Effective
for services furnished on or after January 1, 2010, for
the State of California, any reference in this section
to a fee schedule area shall be deemed a reference to
an MSA in the State.''.
(b) Conforming Amendment to Definition of Fee Schedule Area.--Section
1848(j)(2) of the Social Security Act (42 U.S.C. 1395w(j)(2)) is
amended by striking ``The term'' and inserting ``Except as provided in
subsection (e)(6)(C), the term''.
SEC. 1126. RESOURCE-BASED FEEDBACK PROGRAM FOR PHYSICIANS IN MEDICARE.
(a) In General.--The Secretary of Health and Human Services (in this
section referred to as the ``Secretary'') shall provide for the
measurement and confidential communication of reports (each in this
section referred to as a ``feedback report'') to physicians and other
practitioners regarding the utilization of services under the Medicare
program under title XVIII of the Social Security Act. Such reports
shall be based upon claims data and shall include quality data reported
under section 1848(m)(5) of such Act (42 U.S.C. 1395w-4(m)(5)) and such
other information as the Secretary determines appropriate.
(b) Timeline for Feedback Program.--
(1) Analysis tool.--Not later than December 31, 2010, the
Secretary shall initially develop an episode grouper or other
initial resource analysis tool described in subsection (c)(4).
(2) Evaluation.--During 2011 the Secretary shall conduct the
evaluation specified in subsection (e)(1).
(3) Expansion.--The Secretary shall expand the program as
specified in subsection (e)(2).
(c) Feedback Reports.--
(1) Comparison of resource use patterns.--Feedback reports
shall include information allowing the comparison of a
physician's resource use pattern to such pattern for peers.
Such reports may include resource use data on--
(A) a per capita basis;
(B) a per episode basis; or
(C) both.
(2) Peer comparison.--Reports under this section shall
include information regarding nationwide groups of similarly
situated physicians (taking into consideration specialty,
practice setting, and such other criteria as the Secretary
finds appropriate) and comparing the pattern of services of
each physician in the group to the group average pattern of
services.
(3) Detailed information.--The Secretary shall include in
feedback reports details about the services, procedures, and
relevant clinical information to identify factors that may
account for significant variation of a physician from national
norms, such as high rates of elective surgeries, diagnostic
services, or other utilization attributable to the judgment of
the physician.
(4) Development of episode grouper.--The Secretary shall, in
consultation with physicians and others as the Secretary
determines to be appropriate, develop an episode grouper or
other resource analysis tool that could be used to measure
physician resource use. The Secretary may update such grouper
from time to time as appropriate.
(d) Feedback Program.--The Secretary shall engage in efforts to
disseminate feedback reports. In disseminating such reports, the
Secretary shall seek to estalish their validity and credibility to
physicians and shall experiment with communications methods such as the
following:
(1) Direct meetings between contracted physicians,
facilitated by the Secretary, to discuss the contents of
feedback reports, including any reasons for divergence from
national averages.
(2) Contracts with local, non-profit entities engaged in
quality improvement efforts at the community level. Such
entities shall use the feedback reports, or such equivalent
tool as specified by the Secretary. Any exchange of data under
this paragraph shall be protected by appropriate privacy
safeguards.
(3) Mailings or other methods of communication that
facilitate large-scale dissemination.
(4) Other methods specified by the Secretary.
(e) Evaluation and Expansion.--
(1) Evaluation.--The Secretary shall evaluate the methods
specified in subsection (d) with regard to their efficacy in
changing practice patterns to improve quality and decrease
costs.
(2) Expansion.--Taking into account the cost of each method,
the Secretary shall develop a plan to disseminate such reports
in a significant manner in the regions and cities of the
country with the highest utilization of services under
Medicare. The Secretary shall disseminate, to the extent
practicable, feedback reports in a manner consistent with the
following:
(A) During 2011, at least 1,000 reports.
(B) During 2012, at least 10,000 reports.
(C) During 2013, at least 25,000 reports.
(D) During 2014 and subsequent years, reports to the
physicians with utilization within the highest 5
percent of physicians, subject to the authority to
focus under subsection (f).
(3) Opt out.--The Secretary shall establish a process by
which a physician may opt not to receive feedback reports under
this section.
(f) Authority to Focus Program Application.--The secretary may focus
the application of the program under this section and dissemination of
feedback reports on physicians, as appropriate, such as on physicians
who--
(1) practice in geographic areas that account for unusually
high rates of spending per capita;
(2) treat conditions that have a high cost or volume under
Medicare;
(3) use a high amount of resources compared to other
physicians; or
(4) treat at least a minimum number of Medicare
beneficiaries.
(g) Inclusion of Certain Practitioners.--For purposes of this
section, the term ``physician'' includes a practitioner who furnishes
services for which payment is made under Medicare and for which such
payment would be made if furnished by a physician.
(h) Administration.--
(1) Chapter 35 of title 44, United States Code shall not
apply to this section.
(2) Notwithstanding any other provision of law, the Secretary
may implement the provisions of this section by program
instruction or otherwise.
PART 2--MARKET BASKET UPDATES
SEC. 1131. INCORPORATING PRODUCTIVITY IMPROVEMENTS INTO MARKET BASKET
UPDATES THAT DO NOT ALREADY INCORPORATE SUCH
IMPROVEMENTS.
(a) Outpatient Hospitals.--
(1) In general.--The first sentence of section
1833(t)(3)(C)(iv) of the Social Security Act (42 U.S.C.
1395l(t)(3)(C)(iv)) is amended--
(A) by inserting ``(which is subject to the
productivity adjustment described in subclause (II) of
such section)'' after ``1886(b)(3)(B)(iii)''; and
(B) by inserting ``(but not below 0)'' after
``reduced''.
(2) Effective date.--The amendments made by paragraph (1)
shall apply to increase factors for services furnished in years
beginning with 2010.
(b) Ambulance Services.--Section 1834(l)(3)(B) of such Act (42 U.S.C.
1395m(l)(3)(B))) is amended by inserting before the period at the end
the following: ``and, in the case of years beginning with 2010, subject
to the productivity adjustment described in section
1886(b)(3)(B)(iii)(II)''.
(c) Ambulatory Surgical Center Services.--Section 1833(i)(2)(D) of
such Act (42 U.S.C. 1395l(i)(2)(D)) is amended--
(1) by redesignating clause (v) as clause (vi); and
(2) by inserting after clause (iv) the following new clause:
``(v) In implementing the system described in clause (i), for
services furnished during 2010 or any subsequent year, to the extent
that an annual percentage change factor applies, such factor shall be
subject to the productivity adjustment described in section
1886(b)(3)(B)(iii)(II).''.
(d) Laboratory Services.--Section 1833(h)(2)(A) of such Act (42
U.S.C. 1395l(h)(2)(A)) is amended--
(1) in clause (i), by striking ``for each of the years 2009
through 2013'' and inserting ``for 2009''; and
(2) clause (ii)--
(A) by striking ``and'' at the end of subclause
(III);
(B) by striking the period at the end of subclause
(IV) and inserting ``; and''; and
(C) by adding at the end the following new subclause:
``(V) the annual adjustment in the fee schedules determined
under clause (i) for years beginning with 2010 shall be subject
to the productivity adjustment described in section
1886(b)(3)(B)(iii)(II).''.
(e) Certain Durable Medical Equipment.--Section 1834(a)(14) of such
Act (42 U.S.C. 1395m(a)(14)) is amended--
(1) in subparagraph (K), by inserting before the semicolon at
the end the following: ``, subject to the productivity
adjustment described in section 1886(b)(3)(B)(iii)(II)'';
(2) in subparagraph (L)(i), by inserting after ``June 2013,''
the following: ``subject to the productivity adjustment
described in section 1886(b)(3)(B)(iii)(II),'';
(3) in subparagraph (L)(ii), by inserting after ``June 2013''
the following: ``, subject to the productivity adjustment
described in section 1886(b)(3)(B)(iii)(II)''; and
(4) in subparagraph (M), by inserting before the period at
the end the following: ``, subject to the productivity
adjustment described in section 1886(b)(3)(B)(iii)(II)''.
PART 3--OTHER PROVISIONS
SEC. 1141. RENTAL AND PURCHASE OF POWER-DRIVEN WHEELCHAIRS.
(a) In General.--Section 1834(a)(7)(A)(iii) of the Social Security
Act (42 U.S.C. 1395m(a)(7)(A)(iii)) is amended--
(1) in the heading, by inserting ``certain complex
rehabilitative'' after ``option for''; and
(2) by striking ``power-driven wheelchair'' and inserting
``complex rehabilitative power-driven wheelchair recognized by
the Secretary as classified within group 3 or higher''.
(b) Effective Date.--The amendments made by subsection (a) shall take
effect on January 1, 2011, and shall apply to power-driven wheelchairs
furnished on or after such date. Such amendments shall not apply to
contracts entered into under section 1847 of the Social Security Act
(42 U.S.C. 1395w-3) pursuant to a bid submitted under such section
before October 1, 2010, under subsection (a)(1)(B)(i)(I) of such
section.
SEC. 1141A. ELECTION TO TAKE OWNERSHIP, OR TO DECLINE OWNERSHIP, OF A
CERTAIN ITEM OF COMPLEX DURABLE MEDICAL EQUIPMENT
AFTER THE 13-MONTH CAPPED RENTAL PERIOD ENDS.
(a) In General.--Section 1834(a)(7)(A) of the Social Security Act (42
U.S.C. 1395m(a)(7)(A)) is amended--
(1) in clause (ii)--
(A) by striking ``rental.--On'' and inserting
``rental.--
``(I) In general.--Except as provided
in subclause (II), on''; and
(B) by adding at the end the following new subclause:
``(II) Option to accept or reject
transfer of title to group 3 support
surface.--
``(aa) In general.--During
the 10th continuous month
during which payment is made
for the rental of a Group 3
Support Surface under clause
(i), the supplier of such item
shall offer the individual the
option to accept or reject
transfer of title to a Group 3
Support Surface after the 13th
continuous month during which
payment is made for the rental
of the Group 3 Support Surface
under clause (i). Such title
shall be transferred to the
individual only if the
individual notifies the
supplier not later than 1 month
after the supplier makes such
offer that the individual
agrees to accept transfer of
the title to the Group 3
Support Surface. Unless the
individual accepts transfer of
title to the Group 3 Support
Surface in the manner set forth
in this subclause, the
individual shall be deemed to
have rejected transfer of
title. If the individual agrees
to accept the transfer of the
title to the Group 3 Support
Surface, the supplier shall
transfer such title to the
individual on the first day
that begins after the 13th
continuous month during which
payment is made for the rental
of the Group 3 Support Surface
under clause (i). If the
supplier transfers title to the
Group 3 Support Surface under
this subclause, payments for
maintenance and servicing after
the transfer of title shall be
made in accordance with clause
(iv). If the individual rejects
transfer of title under this
subclause, payments for
maintenance and servicing after
the end of the period of
medical need during which
payment is made under clause
(i) shall be made in accordance
with clause (v).
``(bb) Special rule.--If, on
the effective date of this
subclause, an individual's
rental period for a Group 3
Support Surface has exceeded 10
continuous months, but the
first day that begins after the
13th continuous month during
which payment is made for the
rental under clause (i) has not
been reached, the supplier
shall, within 1 month following
such effective date, offer the
individual the option to accept
or reject transfer of title to
a Group 3 Support Surface. Such
title shall be transferred to
the individual only if the
individual notifies the
supplier not later than 1 month
after the supplier makes such
offer that the individual
agrees to accept transfer of
title to the Group 3 Support
Surface. Unless the individual
accepts transfer of title to
the Group 3 Support Surface in
the manner set forth in this
subclause, the individual shall
be deemed to have rejected
transfer of title. If the
individual agrees to accept the
transfer of the title to the
Group 3 Support Surface, the
supplier shall transfer such
title to the individual on the
first day that begins after the
13th continuous month during
which payment is made for the
rental of the Group 3 Support
Surface under clause (i) unless
that day has passed, in which
case the supplier shall
transfer such title to the
individual not later than 1
month after notification that
the individual accepts transfer
of title. If the supplier
transfers title to the Group 3
Support Surface under this
subclause, payments for
maintenance and servicing after
the transfer of title shall be
made in accordance with clause
(iv). If the individual rejects
transfer of title under this
subclause, payments for
maintenance and servicing after
the end of the period of
medical need during which
payment is made under clause
(i) shall be made in accordance
with clause (v).'';
(2) in clause (iv), in the heading, by inserting ``after
transfer of title'' after ``servicing''; and
(3) by adding at the end the following new clause:
``(v) Maintenance and servicing of group 3
support surface if individual rejects transfer
of title.--In the case of a Group 3 Support
Surface for which the individual has rejected
transfer of title under subclause (ii)(II)--
``(I) during the first 6-month period
of medical need that follows the period
of medical need during which payment is
made under clause (i), no payment shall
be made for rental or maintenance and
servicing of the Group 3 Support
Surface; and
``(II) during the first month of each
succeeding 6-month period of medical
need, a maintenance and servicing
payment may be made (for parts and
labor not covered by the supplier's or
manufacturer's warranty, as determined
by the Secretary to be appropriate for
the Group 3 Support Surface) and the
amount recognized for each such 6-month
period is the lower of--
``(aa) a reasonable and
necessary maintenance and
servicing fee or fees
established by the Secretary;
or
``(bb) 10 percent of the
total of the purchase price
recognized under paragraph (8)
with respect to the Group 3
Support Surface.''.
(b) Effective Date.--The amendments made by this section shall take
effect on the date of enactment of this Act.
SEC. 1142. EXTENSION OF PAYMENT RULE FOR BRACHYTHERAPY.
Section 1833(t)(16)(C) of the Social Security Act (42 U.S.C.
1395l(t)(16)(C)), as amended by section 142 of the Medicare
Improvements for Patients and Providers Act of 2008 (Public Law 110-
275), is amended by striking, the first place it appears, ``January 1,
2010'' and inserting ``January 1, 2012''.
SEC. 1143. HOME INFUSION THERAPY REPORT TO CONGRESS.
Not later than 12 months after the date of enactment of this Act, the
Medicare Payment Advisory Commission shall submit to Congress a report
on the following:
(1) The scope of coverage for home infusion therapy in the
fee-for-service Medicare program under title XVIII of the
Social Security Act, Medicare Advantage under part C of such
title, the veteran's health care program under chapter 17 of
title 38, United States Code, and among private payers,
including an analysis of the scope of services provided by home
infusion therapy providers to their patients in such programs.
(2) The benefits and costs of providing such coverage under
the Medicare program, including a calculation of the potential
savings achieved through avoided or shortened hospital and
nursing home stays as a result of Medicare coverage of home
infusion therapy.
(3) An assessment of sources of data on the costs of home
infusion therapy that might be used to construct payment
mechanisms in the Medicare program.
(4) Recommendations, if any, on the structure of a payment
system under the Medicare program for home infusion therapy,
including an analysis of the payment methodologies used under
Medicare Advantage plans and private health plans for the
provision of home infusion therapy and their applicability to
the Medicare program.
SEC. 1144. REQUIRE AMBULATORY SURGICAL CENTERS (ASCS) TO SUBMIT COST
DATA AND OTHER DATA.
(a) Cost Reporting.--
(1) In general.--Section 1833(i) of the Social Security Act
(42 U.S.C. 1395l(i)) is amended by adding at the end the
following new paragraph:
``(8) The Secretary shall require, as a condition of the agreement
described in section 1832(a)(2)(F)(i), the submission of such cost
report as the Secretary may specify, taking into account the
requirements for such reports under section 1815 in the case of a
hospital.''.
(2) Development of cost report.--Not later than 3 years after
the date of the enactment of this Act, the Secretary of Health
and Human Services shall develop a cost report form for use
under section 1833(i)(8) of the Social Security Act, as added
by paragraph (1).
(3) Audit requirement.--The Secretary shall provide for
periodic auditing of cost reports submitted under section
1833(i)(8) of the Social Security Act, as added by paragraph
(1).
(4) Effective date.--The amendment made by paragraph (1)
shall apply to agreements applicable to cost reporting periods
beginning 18 months after the date the Secretary develops the
cost report form under paragraph (2).
(b) Additional Data on Quality.--
(1) In general.--Section 1833(i)(7) of such Act (42 U.S.C.
1395l(i)(7)) is amended--
(A) in subparagraph (B), by inserting ``subject to
subparagraph (C),'' after ``may otherwise provide,'';
and
(B) by adding at the end the following new
subparagraph:
``(C) Under subparagraph (B) the Secretary shall require the
reporting of such additional data relating to quality of services
furnished in an ambulatory surgical facility, including data on health
care associated infections, as the Secretary may specify.''.
(2) Effective date.--The amendment made by paragraph (1)
shall to reporting for years beginning with 2012.
SEC. 1145. TREATMENT OF CERTAIN CANCER HOSPITALS.
Section 1833(t) of the Social Security Act (42 U.S.C. 1395l(t)) is
amended by adding at the end the following new paragraph:
``(18) Authorization of adjustment for cancer hospitals.--
``(A) Study.--The Secretary shall conduct a study to
determine if, under the system under this subsection,
costs incurred by hospitals described in section
1886(d)(1)(B)(v) with respect to ambulatory payment
classification groups exceed those costs incurred by
other hospitals furnishing services under this
subsection (as determined appropriate by the
Secretary).
``(B) Authorization of adjustment.--Insofar as the
Secretary determines under subparagraph (A) that costs
incurred by hospitals described in section
1886(d)(1)(B)(v) exceed those costs incurred by other
hospitals furnishing services under this subsection,
the Secretary shall provide for an appropriate
adjustment under paragraph (2)(E) to reflect those
higher costs effective for services furnished on or
after January 1, 2011.''.
SEC. 1146. MEDICARE IMPROVEMENT FUND.
Section 1898(b)(1)(A) of the Social Security Act (42 U.S.C.
1395iii(b)(1)(A)) is amended to read as follows:
``(A) the period beginning with fiscal year 2011 and
ending with fiscal year 2019, $8,000,000,000; and''.
SEC. 1147. PAYMENT FOR IMAGING SERVICES.
(a) Adjustment in Practice Expense to Reflect Higher Presumed
Utilization.--Section 1848 of the Social Security Act (42 U.S.C. 1395w)
is amended--
(1) in subsection (b)(4)--
(A) in subparagraph (B), by striking ``subparagraph
(A)'' and inserting ``this paragraph''; and
(B) by adding at the end the following new
subparagraph:
``(C) Adjustment in practice expense to reflect
higher presumed utilization.--In computing the number
of practice expense relative value units under
subsection (c)(2)(C)(ii) with respect to advanced
diagnostic imaging services (as defined in section
1834(e)(1)(B)) , the Secretary shall adjust such number
of units so it reflects a 75 percent (rather than 50
percent) presumed rate of utilization of imaging
equipment.''; and
(2) in subsection (c)(2)(B)(v)(II), by inserting ``and other
provisions'' after ``OPD payment cap''.
(b) Adjustment in Technical Component ``discount'' on Single-session
Imaging to Consecutive Body Parts.--Section 1848(b)(4) of such Act is
further amended by adding at the end the following new subparagraph:
``(D) Adjustment in technical component discount on
single-session imaging involving consecutive body
parts.--The Secretary shall increase the reduction in
expenditures attributable to the multiple procedure
payment reduction applicable to the technical component
for imaging under the final rule published by the
Secretary in the Federal Register on November 21, 2005
(part 405 of title 42, Code of Federal Regulations)
from 25 percent to 50 percent.''.
(c) Effective Date.--Except as otherwise provided, this section, and
the amendments made by this section, shall apply to services furnished
on or after January 1, 2011.
SEC. 1148. DURABLE MEDICAL EQUIPMENT PROGRAM IMPROVEMENTS.
(a) Waiver of Surety Bond Requirement.--Section 1834(a)(16) of the
Social Security Act (42 U.S.C. 1395m(a)(16)) is amended by adding at
the end the following: ``The requirement for a surety bond described in
subparagraph (B) shall not apply in the case of a pharmacy (i) that has
been enrolled under section 1866(j) as a supplier of durable medical
equipment, prosthetics, orthotics, and supplies and has been issued
(which may include renewal of) a provider number (as described in the
first sentence of this paragraph) for at least 5 years, and (ii) for
which a final adverse action (as defined in section 424.57(a) of title
42, Code of Federal Regulations) has never been imposed.''.
(b) Ensuring Supply of Oxygen Equipment .--
(1) In general.--Section 1834(a)(5)(F) of the Social Security
Act (42 U.S.C. 1395m(a)(5)(F)) is amended--
(A) in clause (ii), by striking ``After the'' and
inserting ``Except as provided in clause (iii), after
the''; and
(B) by adding at the end the following new clause:
``(iii) Continuation of supply.--In the case
of a supplier furnishing such equipment to an
individual under this subsection as of the 27th
month of the 36 months described in clause (i),
the supplier furnishing such equipment as of
such month shall continue to furnish such
equipment to such individual (either directly
or though arrangements with other suppliers of
such equipment) during any subsequent period of
medical need for the remainder of the
reasonable useful lifetime of the equipment, as
determined by the Secretary, regardless of the
location of the individual, unless another
supplier has accepted responsibility for
continuing to furnish such equipment during the
remainder of such period.''.
(2) Effective date.--The amendments made by paragraph (1)
shall take effect as of the date of the enactment of this Act
and shall apply to the furnishing of equipment to individuals
for whom the 27th month of a continuous period of use of oxygen
equipment described in section 1834(a)(5)(F) of the Social
Security Act occurs on or after July 1, 2010.
(c) Treatment of Current Accreditation Applications.--Section
1834(a)(20)(F) of such Act (42 U.S.C. 1395m(a)(20)(F)) is amended--
(1) in clause (i)--
(A) by striking ``clause (ii)'' and inserting
``clauses (ii) and (iii)''; and
(B) by striking ``and'' at the end;
(2) by striking the period at the end of clause (ii)(II) and
by inserting ``; and''; and
(3) by adding at the end the following:
``(iii) the requirement for accreditation
described in clause (i) shall not apply for
purposes of supplying diabetic testing
supplies, canes, and crutches in the case of a
pharmacy that is enrolled under section 1866(j)
as a supplier of durable medical equipment,
prosthetics, orthotics, and supplies.
Any supplier that has submitted an application for
accreditation before August 1, 2009, shall be deemed as
meeting applicable standards and accreditation
requirement under this subparagraph until such time as
the independent accreditation organization takes action
on the supplier's application.''.
(d) Restoring 36-month Oxygen Rental Period in Case of Supplier
Bankruptcy for Certain Individuals.--Section 1834(a)(5)(F) of such Act
(42 U.S.C. 1395m(a)(5)(F)) is amended by adding at the end the
following new clause:
``(iv) Exception for bankruptcy.--If a
supplier of oxygen to an individual is declared
bankrupt and its assets are liquidated and at
the time of such declaration and liquidation
more than 24 months of rental payments have
been made, the individual may begin under this
subparagraph a new 36-month rental period with
another supplier of oxygen.''.
(e) Payment Adjustment.--Section 1834(a)(14)(K) of such Act (42
U.S.C. 1395m(a)(14)(K)), as amended by section 1131(e), is amended by
inserting before the semicolon at the end the following: ``, -0.5
percent''.
SEC. 1149. MEDPAC STUDY AND REPORT ON BONE MASS MEASUREMENT.
(a) In General.--The Medicare Payment Advisory Commission shall
conduct a study regarding bone mass measurement, including computed
tomography, duel-energy x-ray absorptriometry, and vertebral fracture
assessment. The study shall focus on the following:
(1) An assessment of the adequacy of Medicare payment rates
for such services, taking into account costs of acquiring the
necessary equipment, professional work time, and practice
expense costs.
(2) The impact of Medicare payment changes since 2006 on
beneficiary access to bone mass measurement benefits in general
and in rural and minority communities specifically.
(3) A review of the clinically appropriate and recommended
use among Medicare beneficiaries and how usage rates among such
beneficiaries compares to such recommendations.
(4) In conjunction with the findings under (3),
recommendations, if necessary, regarding methods for reaching
appropriate use of bone mass measurement studies among Medicare
beneficiaries.
(b) Report.--The Commission shall submit a report to the Congress,
not later than 9 months after the date of the enactment of this Act,
containing a description of the results of the study conducted under
subsection (a) and the conclusions and recommendations, if any,
regarding each of the issues described in paragraphs (1), (2) (3) and
(4) of such subsection.
SEC. 1149A. EXCLUSION OF CUSTOMARY PROMPT PAY DISCOUNTS EXTENDED TO
WHOLESALERS FROM MANUFACTURER'S AVERAGE SALES PRICE
FOR PAYMENTS FOR DRUGS AND BIOLOGICALS UNDER
MEDICARE PART B.
Section 1847A(c)(3) of the Social Security Act (42 U.S.C. 1395w-
3a(c)(3)) is amended--
(1) in the first sentence, by inserting after ``prompt pay
discounts'' the following: ``(other than, for drugs and
biologicals that are sold on or after January 1, 2011, and
before January 1, 2016, customary prompt pay discounts extended
to wholesalers, but only to the extent such discounts do not
exceed 2 percent of the wholesale acquisition cost)''; and
(2) in the second sentence, by inserting after ``other price
concessions'' the following: ``(other than, for drugs and
biologicals that are sold on or after January 1, 2011, and
before January 1, 2016, customary prompt pay discounts extended
to wholesalers, but only to the extent such discounts do not
exceed 2 percent of the wholesale acquisition cost)''.
SEC. 1149B. TIMELY ACCESS TO POSTMASTECTOMY ITEMS.
(a) In General.--Section 1834(h)(1) of the Social Security Act (42
U.S.C. 1395m(h)(1)) is amended--
(1) by redesignating subparagraph (H) as subparagraph (I);
and
(2) by inserting after subparagraph (G) the following new
subparagraph:
``(H) Special payment rule for postmastectomy
external breast prosthesis garments.--Payment for
postmastectomy external breast prosthesis garments
shall be made regardless of whether such items are
supplied to the beneficiary prior to or after the
mastectomy procedure or other breast cancer surgical
procedure. The Secretary shall develop policies to
ensure appropriate beneficiary access and utilization
safeguards for such items supplied to a beneficiary
prior to the mastectomy or other breast cancer surgical
procedure.''
(b) Effective Date.--The amendment made by subsection (a) shall take
effect the date of the enactment of this Act.
SEC. 1149C. MORATORIUM ON MEDICARE REDUCTIONS IN PAYMENT RATES FOR
CERTAIN INTERVENTIONAL PAIN MANAGEMENT PROCEDURES
COVERED UNDER THE ASC FEE SCHEDULE.
(a) In General.--Notwithstanding any other provision of law, the
payment rate applied under section 1833(i)(2) of the Social Security
Act (42 U.S.C. 13951(i)(2)) for interventional pain management
procedures specified in subsection (b) which are furnished on or after
January 1, 2010, and before January 1, 2012, shall not be less than the
payment rate applied under such section for such procedures in effect
as of January 1, 2007.
(b) Procedures Specified.--For purposes of this section, the
interventional pain management procedures specified in this subsection
are the following:
(1) Epidural injections (CPT 62310, 62311, 64483, 64484).
(2) Facet joint injections (CPT 64470, 64472, 64475, 64476).
(3) Sacroiliac joint injection (CPT 27096).
SEC. 1149D. MEDICARE COVERAGE OF SERVICES OF QUALIFIED RESPIRATORY
THERAPISTS PERFORMED UNDER THE GENERAL SUPERVISION
OF A PHYSICIAN.
(a) In General.--Section 1861 of the Social Security Act (42 U.S.C.
1395x), as amended by sections 1233(a) and 1309, is amended--
(1) in subsection (s)(2)--
(A) by striking ``and'' at the end of subparagraph
(GG);
(B) by adding ``and'' at the end of subparagraph
(HH); and
(C) by adding at the end the following new
subparagraph:
``(II) respiratory therapy services which would be
physicians' services if furnished by a physician (as defined in
subsection (r)(1)) for the diagnosis and treatment of
respiratory illnesses and which are performed by a respiratory
therapist (as defined in subsection (mmm)) under the general
supervision of a physician and which the respiratory therapist
is legally authorized to perform by the State in which the
services are performed, but only if no facility or other
provider charges or is paid any amounts with respect to the
furnishing of such services;''; and
(2) by adding after subsection (lll) the following new
subsection:
``Respiratory Therapist
``(mmm) For purposes of subsection (s)(2)(II) and section
1833(a)(1)(X) only, the term `respiratory therapist' means an
individual who--
``(1) is credentialed by a national credentialing board
recognized by the Secretary;
``(2)(A) is licensed to practice respiratory therapy in the
State in which the respiratory therapy services are performed,
or
``(B) in the case of an individual in a State which does not
provide for such licensure, is legally authorized to perform
respiratory therapy services (in the State in which the
individual performed such services) under State law (or the
State regulatory mechanism provided by State law);
``(3) is a registered respiratory therapist; and
``(4) holds a bachelor's degree.''.
(b) Payment.--Section 1833(a)(1) of such Act (42 U.S.C. 1395l(a)(1)),
as amended by sections 1309(a)(4) and 1309(b)(4), is amended--
(1) by striking ``and'' before ``(Y)''; and
(2) by inserting before the semicolon at the end the
following: ``, and (Z) with respect to services described in
section 1861(s)(2)(II) (relating to services furnished by a
respiratory therapist) that are furnished by a respiratory
therapist (as defined in section 1861(mmm)), the amount paid
shall be equal to 80 percent of the lesser of the actual charge
for the services or 85 percent of the fee schedule amount
provided under section 1848 for the same services if furnished
by a physician''.
(c) Effective Date.--The amendments made by this section shall apply
to services furnished on or after January 1, 2010.
Subtitle C--Provisions Related to Medicare Parts A and B
SEC. 1151. REDUCING POTENTIALLY PREVENTABLE HOSPITAL READMISSIONS.
(a) Hospitals.--
(1) In general.--Section 1886 of the Social Security Act (42
U.S.C. 1395ww), as amended by section 1103(a), is amended by
adding at the end the following new subsection:
``(p) Adjustment to Hospital Payments for Excess Readmissions.--
``(1) In general.--With respect to payment for discharges
from an applicable hospital (as defined in paragraph (5)(C))
occurring during a fiscal year beginning on or after October 1,
2011, in order to account for excess readmissions in the
hospital, the Secretary shall reduce the payments that would
otherwise be made to such hospital under subsection (d) (or
section 1814(b)(3), as the case may be) for such a discharge by
an amount equal to the product of--
``(A) the base operating DRG payment amount (as
defined in paragraph (2)) for the discharge; and
``(B) the adjustment factor (described in paragraph
(3)(A)) for the hospital for the fiscal year.
``(2) Base operating drg payment amount.--
``(A) In general.--Except as provided in subparagraph
(B), for purposes of this subsection, the term `base
operating DRG payment amount' means, with respect to a
hospital for a fiscal year, the payment amount that
would otherwise be made under subsection (d) for a
discharge if this subsection did not apply, reduced by
any portion of such amount that is attributable to
payments under subparagraphs (B) and (F) of paragraph
(5).
``(B) Adjustments.--For purposes of subparagraph (A),
in the case of a hospital that is paid under section
1814(b)(3), the term `base operating DRG payment
amount' means the payment amount under such section.
``(3) Adjustment factor.--
``(A) In general.--For purposes of paragraph (1), the
adjustment factor under this paragraph for an
applicable hospital for a fiscal year is equal to the
greater of--
``(i) the ratio described in subparagraph (B)
for the hospital for the applicable period (as
defined in paragraph (5)(D)) for such fiscal
year; or
``(ii) the floor adjustment factor specified
in subparagraph (C).
``(B) Ratio.--The ratio described in this
subparagraph for a hospital for an applicable period is
equal to 1 minus the ratio of--
``(i) the aggregate payments for excess
readmissions (as defined in paragraph (4)(A))
with respect to an applicable hospital for the
applicable period; and
``(ii) the aggregate payments for all
discharges (as defined in paragraph (4)(B))
with respect to such applicable hospital for
such applicable period.
``(C) Floor adjustment factor.--For purposes of
subparagraph (A), the floor adjustment factor specified
in this subparagraph for--
``(i) fiscal year 2012 is 0.99;
``(ii) fiscal year 2013 is 0.98;
``(iii) fiscal year 2014 is 0.97; or
``(iv) a subsequent fiscal year is 0.95.
``(4) Aggregate payments, excess readmission ratio defined.--
For purposes of this subsection:
``(A) Aggregate payments for excess readmissions.--
The term `aggregate payments for excess readmissions'
means, for a hospital for a fiscal year, the sum, for
applicable conditions (as defined in paragraph (5)(A)),
of the product, for each applicable condition, of--
``(i) the base operating DRG payment amount
for such hospital for such fiscal year for such
condition;
``(ii) the number of admissions for such
condition for such hospital for such fiscal
year; and
``(iii) the excess readmissions ratio (as
defined in subparagraph (C)) for such hospital
for the applicable period for such fiscal year
minus 1.
``(B) Aggregate payments for all discharges.--The
term `aggregate payments for all discharges' means, for
a hospital for a fiscal year, the sum of the base
operating DRG payment amounts for all discharges for
all conditions from such hospital for such fiscal year.
``(C) Excess readmission ratio.--
``(i) In general.--Subject to clauses (ii)
and (iii), the term `excess readmissions ratio'
means, with respect to an applicable condition
for a hospital for an applicable period, the
ratio (but not less than 1.0) of--
``(I) the risk adjusted readmissions
based on actual readmissions, as
determined consistent with a
readmission measure methodology that
has been endorsed under paragraph
(5)(A)(ii)(I), for an applicable
hospital for such condition with
respect to the applicable period; to
``(II) the risk adjusted expected
readmissions (as determined consistent
with such a methodology) for such
hospital for such condition with
respect to such applicable period.
``(ii) Exclusion of certain readmissions.--
For purposes of clause (i), with respect to a
hospital, excess readmissions shall not include
readmissions for an applicable condition for
which there are fewer than a minimum number (as
determined by the Secretary) of discharges for
such applicable condition for the applicable
period and such hospital.
``(iii) Adjustment.--In order to promote a
reduction over time in the overall rate of
readmissions for applicable conditions, the
Secretary may provide, beginning with
discharges for fiscal year 2014, for the
determination of the excess readmissions ratio
under subparagraph (C) to be based on a ranking
of hospitals by readmission ratios (from lower
to higher readmission ratios) normalized to a
benchmark that is lower than the 50th
percentile.
``(5) Definitions.--For purposes of this subsection:
``(A) Applicable condition.--The term `applicable
condition' means, subject to subparagraph (B), a
condition or procedure selected by the Secretary among
conditions and procedures for which--
``(i) readmissions (as defined in
subparagraph (E)) that represent conditions or
procedures that are high volume or high
expenditures under this title (or other
criteria specified by the Secretary); and
``(ii) measures of such readmissions--
``(I) have been endorsed by the
entity with a contract under section
1890(a); and
``(II) such endorsed measures have
appropriate exclusions for readmissions
that are unrelated to the prior
discharge (such as a planned
readmission or transfer to another
applicable hospital).
``(B) Expansion of applicable conditions.--Beginning
with fiscal year 2013, the Secretary shall expand the
applicable conditions beyond the 3 conditions for which
measures have been endorsed as described in
subparagraph (A)(ii)(I) as of the date of the enactment
of this subsection to the additional 4 conditions that
have been so identified by the Medicare Payment
Advisory Commission in its report to Congress in June
2007 and to other conditions and procedures which may
include an all-condition measure of readmissions, as
determined appropriate by the Secretary. In expanding
such applicable conditions, the Secretary shall seek
the endorsement described in subparagraph (A)(ii)(I)
but may apply such measures without such an
endorsement.
``(C) Applicable hospital.--The term `applicable
hospital' means a subsection (d) hospital or a hospital
that is paid under section 1814(b)(3).
``(D) Applicable period.--The term `applicable
period' means, with respect to a fiscal year, such
period as the Secretary shall specify for purposes of
determining excess readmissions.
``(E) Readmission.--The term `readmission' means, in
the case of an individual who is discharged from an
applicable hospital, the admission of the individual to
the same or another applicable hospital within a time
period specified by the Secretary from the date of such
discharge. Insofar as the discharge relates to an
applicable condition for which there is an endorsed
measure described in subparagraph (A)(ii)(I), such time
period (such as 30 days) shall be consistent with the
time period specified for such measure.
``(6) Limitations on review.--There shall be no
administrative or judicial review under section 1869, section
1878, or otherwise of--
``(A) the determination of base operating DRG payment
amounts;
``(B) the methodology for determining the adjustment
factor under paragraph (3), including excess
readmissions ratio under paragraph (4)(C), aggregate
payments for excess readmissions under paragraph
(4)(A), and aggregate payments for all discharges under
paragraph (4)(B), and applicable periods and applicable
conditions under paragraph (5);
``(C) the measures of readmissions as described in
paragraph (5)(A)(ii); and
``(D) the determination of a targeted hospital under
paragraph (8)(B)(i), the increase in payment under
paragraph (8)(B)(ii), the aggregate cap under paragraph
(8)(C)(i), the hospital-specific limit under paragraph
(8)(C)(ii), and the form of payment made by the
Secretary under paragraph (8)(D).
``(7) Monitoring inappropriate changes in admissions
practices.--The Secretary shall monitor the activities of
applicable hospitals to determine if such hospitals have taken
steps to avoid patients at risk in order to reduce the
likelihood of increasing readmissions for applicable
conditions. If the Secretary determines that such a hospital
has taken such a step, after notice to the hospital and
opportunity for the hospital to undertake action to alleviate
such steps, the Secretary may impose an appropriate sanction.
``(8) Assistance to certain hospitals.--
``(A) In general.--For purposes of providing funds to
applicable hospitals to take steps described in
subparagraph (E) to address factors that may impact
readmissions of individuals who are discharged from
such a hospital, for fiscal years beginning on or after
October 1, 2011, the Secretary shall make a payment
adjustment for a hospital described in subparagraph
(B), with respect to each such fiscal year, by a
percent estimated by the Secretary to be consistent
with subparagraph (C).
``(B) Targeted hospitals.--Subparagraph (A) shall
apply to an applicable hospital that--
``(i) received (or, in the case of an
1814(b)(3) hospital, otherwise would have been
eligible to receive) $10,000,000 or more in
disproportionate share payments using the
latest available data as estimated by the
Secretary; and
``(ii) provides assurances satisfactory to
the Secretary that the increase in payment
under this paragraph shall be used for purposes
described in subparagraph (E).
``(C) Caps.--
``(i) Aggregate cap.--The aggregate amount of
the payment adjustment under this paragraph for
a fiscal year shall not exceed 5 percent of the
estimated difference in the spending that would
occur for such fiscal year with and without
application of the adjustment factor described
in paragraph (3) and applied pursuant to
paragraph (1).
``(ii) Hospital-specific limit.--The
aggregate amount of the payment adjustment for
a hospital under this paragraph shall not
exceed the estimated difference in spending
that would occur for such fiscal year for such
hospital with and without application of the
adjustment factor described in paragraph (3)
and applied pursuant to paragraph (1).
``(D) Form of payment.--The Secretary may make the
additional payments under this paragraph on a lump sum
basis, a periodic basis, a claim by claim basis, or
otherwise.
``(E) Use of additional payment.--Funding under this
paragraph shall be used by targeted hospitals for
transitional care activities designed to address the
patient noncompliance issues that result in higher than
normal readmission rates, such as one or more of the
following:
``(i) Providing care coordination services to
assist in transitions from the targeted
hospital to other settings.
``(ii) Hiring translators and interpreters.
``(iii) Increasing services offered by
discharge planners.
``(iv) Ensuring that individuals receive a
summary of care and medication orders upon
discharge.
``(v) Developing a quality improvement plan
to assess and remedy preventable readmission
rates.
``(vi) Assigning discharged individuals to a
medical home.
``(vii) Doing other activities as determined
appropriate by the Secretary.
``(F) GAO report on use of funds.--Not later than 3
years after the date on which funds are first made
available under this paragraph, the Comptroller General
of the United States shall submit to Congress a report
on the use of such funds.
``(G) Disproportionate share hospital payment.--In
this paragraph, the term `disproportionate share
hospital payment' means an additional payment amount
under subsection (d)(5)(F).''.
(b) Application to Critical Access Hospitals.--Section 1814(l) of the
Social Security Act (42 U.S.C. 1395f(l)) is amended--
(1) in paragraph (5)--
(A) by striking ``and'' at the end of subparagraph
(C);
(B) by striking the period at the end of subparagraph
(D) and inserting ``; and'';
(C) by inserting at the end the following new
subparagraph:
``(E) the methodology for determining the adjustment factor
under paragraph (5), including the determination of aggregate
payments for actual and expected readmissions, applicable
periods, applicable conditions and measures of readmissions.'';
and
(D) by redesignating such paragraph as paragraph (6);
and
(2) by inserting after paragraph (4) the following new
paragraph:
``(5) The adjustment factor described in section 1886(p)(3) shall
apply to payments with respect to a critical access hospital with
respect to a cost reporting period beginning in fiscal year 2012 and
each subsequent fiscal year (after application of paragraph (4) of this
subsection) in a manner similar to the manner in which such section
applies with respect to a fiscal year to an applicable hospital as
described in section 1886(p)(2).''.
(c) Post Acute Care Providers.--
(1) Interim policy.--
(A) In general.--With respect to a readmission to an
applicable hospital or a critical access hospital (as
described in section 1814(l) of the Social Security
Act) from a post acute care provider (as defined in
paragraph (3)) and such a readmission is not governed
by section 412.531 of title 42, Code of Federal
Regulations, if the claim submitted by such a post-
acute care provider under title XVIII of the Social
Security Act indicates that the individual was
readmitted to a hospital from such a post-acute care
provider or admitted from home and under the care of a
home health agency within 30 days of an initial
discharge from an applicable hospital or critical
access hospital, the payment under such title on such
claim shall be the applicable percent specified in
subparagraph (B) of the payment that would otherwise be
made under the respective payment system under such
title for such post-acute care provider if this
subsection did not apply.
(B) Applicable percent defined.--For purposes of
subparagraph (A), the applicable percent is--
(i) for fiscal or rate year 2012 is 0.996;
(ii) for fiscal or rate year 2013 is 0.993;
and
(iii) for fiscal or rate year 2014 is 0.99.
(C) Effective date.--Subparagraph (1) shall apply to
discharges or services furnished (as the case may be
with respect to the applicable post acute care
provider) on or after the first day of the fiscal year
or rate year, beginning on or after October 1, 2011,
with respect to the applicable post acute care
provider.
(2) Development and application of performance measures.--
(A) In general.--The Secretary of Health and Human
Services shall develop appropriate measures of
readmission rates for post acute care providers. The
Secretary shall seek endorsement of such measures by
the entity with a contract under section 1890(a) of the
Social Security Act but may adopt and apply such
measures under this paragraph without such an
endorsement. The Secretary shall expand such measures
in a manner similar to the manner in which applicable
conditions are expanded under paragraph (5)(B) of
section 1886(p) of the Social Security Act, as added by
subsection (a).
(B) Implementation.--The Secretary shall apply, on or
after October 1, 2014, with respect to post acute care
providers, policies similar to the policies applied
with respect to applicable hospitals and critical
access hospitals under the amendments made by
subsection (a). The provisions of paragraph (1) shall
apply with respect to any period on or after October 1,
2014, and before such application date described in the
previous sentence in the same manner as such provisions
apply with respect to fiscal or rate year 2014.
(C) Monitoring and penalties.--The provisions of
paragraph (7) of such section 1886(p) shall apply to
providers under this paragraph in the same manner as
they apply to hospitals under such section.
(3) Definitions.--For purposes of this subsection:
(A) Post acute care provider.--The term ``post acute
care provider'' means--
(i) a skilled nursing facility (as defined in
section 1819(a) of the Social Security Act);
(ii) an inpatient rehabilitation facility
(described in section 1886(h)(1)(A) of such
Act);
(iii) a home health agency (as defined in
section 1861(o) of such Act); and
(iv) a long term care hospital (as defined in
section 1861(ccc) of such Act).
(B) Other terms .--The terms ``applicable
condition'', ``applicable hospital'', and
``readmission'' have the meanings given such terms in
section 1886(p)(5) of the Social Security Act, as added
by subsection (a)(1).
(d) Physicians.--
(1) Study.--The Secretary of Health and Human Services shall
conduct a study to determine how the readmissions policy
described in the previous subsections could be applied to
physicians.
(2) Considerations.--In conducting the study, the Secretary
shall consider approaches such as--
(A) creating a new code (or codes) and payment amount
(or amounts) under the fee schedule in section 1848 of
the Social Security Act (in a budget neutral manner)
for services furnished by an appropriate physician who
sees an individual within the first week after
discharge from a hospital or critical access hospital;
(B) developing measures of rates of readmission for
individuals treated by physicians;
(C) applying a payment reduction for physicians who
treat the patient during the initial admission that
results in a readmission; and
(D) methods for attributing payments or payment
reductions to the appropriate physician or physicians.
(3) Report.--The Secretary shall issue a public report on
such study not later than the date that is one year after the
date of the enactment of this Act.
(e) Funding.--For purposes of carrying out the provisions of this
section, in addition to funds otherwise available, out of any funds in
the Treasury not otherwise appropriated, there are appropriated to the
Secretary of Health and Human Services for the Center for Medicare &
Medicaid Services Program Management Account $25,000,000 for each
fiscal year beginning with 2010. Amounts appropriated under this
subsection for a fiscal year shall be available until expended.
SEC. 1152. POST ACUTE CARE SERVICES PAYMENT REFORM PLAN AND BUNDLING
PILOT PROGRAM.
(a) Plan.--
(1) In general.--The Secretary of Health and Human Services
(in this section referred to as the ``Secretary'') shall
develop a detailed plan to reform payment for post acute care
(PAC) services under the Medicare program under title XVIII of
the Social Security Act (in this section referred to as the
``Medicare program)''. The goals of such payment reform are
to--
(A) improve the coordination, quality, and efficiency
of such services; and
(B) improve outcomes for individuals such as reducing
the need for readmission to hospitals from providers of
such services.
(2) Bundling post acute services.--The plan described in
paragraph (1) shall include detailed specifications for a
bundled payment for post acute services (in this section
referred to as the ``post acute care bundle''), and may include
other approaches determined appropriate by the Secretary.
(3) Post acute services.--For purposes of this section, the
term ``post acute services'' means services for which payment
may be made under the Medicare program that are furnished by
skilled nursing facilities, inpatient rehabilitation
facilities, long term care hospitals, hospital based outpatient
rehabilitation facilities and home health agencies to an
individual after discharge of such individual from a hospital,
and such other services determined appropriate by the
Secretary.
(b) Details.--The plan described in subsection (a)(1) shall include
consideration of the following issues:
(1) The nature of payments under a post acute care bundle,
including the type of provider or entity to whom payment should
be made, the scope of activities and services included in the
bundle, whether payment for physicians' services should be
included in the bundle, and the period covered by the bundle.
(2) Whether the payment should be consolidated with the
payment under the inpatient prospective system under section
1886 of the Social Security Act (in this section referred to as
MS-DRGs) or a separate payment should be established for such
bundle, and if a separate payment is established, whether it
should be made only upon use of post acute care services or for
every discharge.
(3) Whether the bundle should be applied across all
categories of providers of inpatient services (including
critical access hospitals) and post acute care services or
whether it should be limited to certain categories of
providers, services, or discharges, such as high volume or high
cost MS-DRGs.
(4) The extent to which payment rates could be established to
achieve offsets for efficiencies that could be expected to be
achieved with a bundle payment, whether such rates should be
established on a national basis or for different geographic
areas, should vary according to discharge, case mix, outliers,
and geographic differences in wages or other appropriate
adjustments, and how to update such rates.
(5) The nature of protections needed for individuals under a
system of bundled payments to ensure that individuals receive
quality care, are furnished the level and amount of services
needed as determined by an appropriate assessment instrument,
are offered choice of provider, and the extent to which
transitional care services would improve quality of care for
individuals and the functioning of a bundled post-acute system.
(6) The nature of relationships that may be required between
hospitals and providers of post acute care services to
facilitate bundled payments, including the application of
gainsharing, anti-referral, anti-kickback, and anti-trust laws.
(7) Quality measures that would be appropriate for reporting
by hospitals and post acute providers (such as measures that
assess changes in functional status and quality measures
appropriate for each type of post acute services provider
including how the reporting of such quality measures could be
coordinated with other reporting of such quality measures by
such providers otherwise required).
(8) How cost-sharing for a post acute care bundle should be
treated relative to current rules for cost-sharing for
inpatient hospital, home health, skilled nursing facility, and
other services.
(9) How other programmatic issues should be treated in a post
acute care bundle, including rules specific to various types of
post-acute providers such as the post-acute transfer policy,
three-day hospital stay to qualify for services furnished by
skilled nursing facilities, and the coordination of payments
and care under the Medicare program and the Medicaid program.
(10) Such other issues as the Secretary deems appropriate.
(c) Consultations and Analysis.--
(1) Consultation with stakeholders.--In developing the plan
under subsection (a)(1), the Secretary shall consult with
relevant stakeholders and shall consider experience with such
research studies and demonstrations that the Secretary
determines appropriate.
(2) Analysis and data collection.--In developing such plan,
the Secretary shall--
(A) analyze the issues described in subsection (b)
and other issues that the Secretary determines
appropriate;
(B) analyze the impacts (including geographic
impacts) of post acute service reform approaches,
including bundling of such services on individuals,
hospitals, post acute care providers, and physicians;
(C) use existing data (such as data submitted on
claims) and collect such data as the Secretary
determines are appropriate to develop such plan
required in this section; and
(D) if patient functional status measures are
appropriate for the analysis, to the extent practical,
build upon the CARE tool being developed pursuant to
section 5008 of the Deficit Reduction Act of 2005.
(d) Administration.--
(1) Funding.--For purposes of carrying out the provisions of
this section, in addition to funds otherwise available, out of
any funds in the Treasury not otherwise appropriated, there are
appropriated to the Secretary for the Center for Medicare &
Medicaid Services Program Management Account $15,000,000 for
each of the fiscal years 2010 through 2012. Amounts
appropriated under this paragraph for a fiscal year shall be
available until expended.
(2) Expedited data collection.--Chapter 35 of title 44,
United States Code shall not apply to this section.
(e) Public Reports.--
(1) Interim reports.--The Secretary shall issue interim
public reports on a periodic basis on the plan described in
subsection (a)(1), the issues described in subsection (b), and
impact analyses as the Secretary determines appropriate.
(2) Final report.--Not later than the date that is 3 years
after the date of the enactment of this Act, the Secretary
shall issue a final public report on such plan, including
analysis of issues described in subsection (b) and impact
analyses.
(f) Conversion of Acute Care Episode Demonstration to Pilot Program
and Expansion to Include Post Acute Services.--
(1) In general.--Part E of title XVIII of the Social Security
Act is amended by inserting after section 1866C the following
new section:
``conversion of acute care episode demonstration to pilot program and
expansion to include post acute services
``Sec. 1866D. (a) In General.--By not later than January 1, 2011,
the Secretary shall, for the purpose of promoting the use of bundled
payments to promote efficient and high quality delivery of care--
``(1) convert the acute care episode demonstration program
conducted under section 1866C to a pilot program; and
``(2) subject to subsection (c), expand such program as so
converted to include post acute services and such other
services the Secretary determines to be appropriate, which may
include transitional services.
``(b) Scope.--The Secretary shall set specific goals for the number
of acute and post-acute bundling test sites under the pilot program to
ensure that the pilot program is of sufficient size and scope to--
``(1) test the approaches under the pilot program in a
variety of settings, including urban, rural, and underserved
areas;
``(2) include geographic areas and additional conditions that
account for significant program spending, as defined by the
Secretary; and
``(3) subject to subsection (d), disseminate the pilot
program rapidly on a national basis.
To the extent that the Secretary finds inpatient and post-acute care
bundling to be successful in improving quality and reducing costs, the
Secretary shall implement such mechanisms and reforms under the pilot
program on as large a geographic scale as practical and economical,
consistent with subsection (e).
``(c) Limitation.--The Secretary shall only expand the pilot program
under subsection (a)(2) if the Secretary finds that--
``(1) the demonstration program under section 1866C and pilot
program under this section maintain or increase the quality of
care received by individuals enrolled under this title; and
``(2) such demonstration program and pilot program reduce
program expenditures and, based on the certification under
subsection (d), that the expansion of such pilot program would
result in estimated spending that would be less than what
spending would otherwise be in the absence of this section.
``(d) Certification.--For purposes of subsection (c), the Chief
Actuary of the Centers for Medicare & Medicaid Services shall certify
whether expansion of the pilot program under this section would result
in estimated spending that would be less than what spending would
otherwise be in the absence of this section.
``(e) Voluntary Participation.--Nothing in this paragraph shall be
construed as requiring the participation of an entity in the pilot
program under this section.''.
(2) Conforming amendment.--Section 1866C(b) of the Social
Security Act (42 U.S.C. 1395cc-3(b)) is amended by striking
``The Secretary'' and inserting ``Subject to section 1866D, the
Secretary''.
SEC. 1153. HOME HEALTH PAYMENT UPDATE FOR 2010.
Section 1895(b)(3)(B)(ii) of the Social Security Act (42 U.S.C.
1395fff(b)(3)(B)(ii)) is amended--
(1) in subclause (IV), by striking ``and'';
(2) by redesignating subclause (V) as subclause (VII); and
(3) by inserting after subclause (IV) the following new
subclauses:
``(V) 2007, 2008, and 2009, subject
to clause (v), the home health market
basket percentage increase;
``(VI) 2010, subject to clause (v), 0
percent; and''.
SEC. 1154. PAYMENT ADJUSTMENTS FOR HOME HEALTH CARE.
(a) Acceleration of Adjustment for Case Mix Changes.--Section
1895(b)(3)(B) of the Social Security Act (42 U.S.C. 1395fff(b)(3)(B))
is amended--
(1) in clause (iv), by striking ``Insofar as'' and inserting
``Subject to clause (vi), insofar as''; and
(2) by adding at the end the following new clause:
``(vi) Special rule for case mix changes for
2011.--
``(I) In general.--With respect to
the case mix adjustments established in
section 484.220(a) of title 42, Code of
Federal Regulations, the Secretary
shall apply, in 2010, the adjustment
established in paragraph (3) of such
section for 2011, in addition to
applying the adjustment established in
paragraph (2) for 2010.
``(II) Construction.--Nothing in this
clause shall be construed as limiting
the amount of adjustment for case mix
for 2010 or 2011 if more recent data
indicate an appropriate adjustment that
is greater than the amount established
in the section described in subclause
(I).''.
(b) Rebasing Home Health Prospective Payment Amount.--Section
1895(b)(3)(A) of the Social Security Act (42 U.S.C. 1395fff(b)(3)(A))
is amended--
(1) in clause (i)--
(A) in subclause (III), by inserting ``and before
2011'' after ``after the period described in subclause
(II)''; and
(B) by inserting after subclause (III) the following
new subclauses:
``(IV) Subject to clause (iii)(I),
for 2011, such amount (or amounts)
shall be adjusted by a uniform
percentage determined to be appropriate
by the Secretary based on analysis of
factors such as changes in the average
number and types of visits in an
episode, the change in intensity of
visits in an episode, growth in cost
per episode, and other factors that the
Secretary considers to be relevant.
``(V) Subject to clause (iii)(II),
for a year after 2011, such a amount
(or amounts) shall be equal to the
amount (or amounts) determined under
this clause for the previous year,
updated under subparagraph (B).''; and
(2) by adding at the end the following new clause:
``(iii) Special rule in case of inability to
effect timely rebasing.--
``(I) Application of proxy amount for
2011.--If the Secretary is not able to
compute the amount (or amounts) under
clause (i)(IV) so as to permit, on a
timely basis, the application of such
clause for 2011, the Secretary shall
substitute for such amount (or amounts)
95 percent of the amount (or amounts)
that would otherwise be specified under
clause (i)(III) if it applied for 2011.
``(II) Adjustment for subsequent
years based on data.--If the Secretary
applies subclause (I), the Secretary
before July 1, 2011, shall compare the
amount (or amounts) applied under such
subclause with the amount (or amounts)
that should have been applied under
clause (i)(IV). The Secretary shall
decrease or increase the prospective
payment amount (or amounts) under
clause (i)(V) for 2012 (or, at the
Secretary's discretion, over a period
of several years beginning with 2012)
by the amount (if any) by which the
amount (or amounts) applied under
subclause (I) is greater or less,
respectively, than the amount (or
amounts) that should have been applied
under clause (i)(IV).''.
SEC. 1155. INCORPORATING PRODUCTIVITY IMPROVEMENTS INTO MARKET BASKET
UPDATE FOR HOME HEALTH SERVICES.
(a) In General.--Section 1895(b)(3)(B) of the Social Security Act (42
U.S.C. 1395fff(b)(3)(B)) is amended--
(1) in clause (iii), by inserting ``(including being subject
to the productivity adjustment described in section
1886(b)(3)(B)(iii)(II))'' after ``in the same manner''; and
(2) in clause (v)(I), by inserting ``(but not below 0)''
after ``reduced''.
(b) Effective Date.--The amendment made by subsection (a) shall apply
to home health market basket percentage increases for years beginning
with 2010.
SEC. 1156. LIMITATION ON MEDICARE EXCEPTIONS TO THE PROHIBITION ON
CERTAIN PHYSICIAN REFERRALS MADE TO HOSPITALS.
(a) In General.--Section 1877 of the Social Security Act (42 U.S.C.
1395nn) is amended--
(1) in subsection (d)(2)--
(A) in subparagraph (A), by striking ``and'' at the
end;
(B) in subparagraph (B), by striking the period at
the end and inserting ``; and''; and
(C) by adding at the end the following new
subparagraph:
``(C) in the case where the entity is a hospital, the
hospital meets the requirements of paragraph (3)(D).'';
(2) in subsection (d)(3)--
(A) in subparagraph (B), by striking ``and'' at the
end;
(B) in subparagraph (C), by striking the period at
the end and inserting ``; and''; and
(C) by adding at the end the following new
subparagraph:
``(D) the hospital meets the requirements described
in subsection (i)(1).'';
(3) by amending subsection (f) to read as follows:
``(f) Reporting and Disclosure Requirements.--
``(1) In general.--Each entity providing covered items or
services for which payment may be made under this title shall
provide the Secretary with the information concerning the
entity's ownership, investment, and compensation arrangements,
including--
``(A) the covered items and services provided by the
entity, and
``(B) the names and unique physician identification
numbers of all physicians with an ownership or
investment interest (as described in subsection
(a)(2)(A)), or with a compensation arrangement (as
described in subsection (a)(2)(B)), in the entity, or
whose immediate relatives have such an ownership or
investment interest or who have such a compensation
relationship with the entity.
Such information shall be provided in such form, manner, and at
such times as the Secretary shall specify. The requirement of
this subsection shall not apply to designated health services
provided outside the United States or to entities which the
Secretary determines provide services for which payment may be
made under this title very infrequently.
``(2) Requirements for hospitals with physician ownership or
investment.--In the case of a hospital that meets the
requirements described in subsection (i)(1), the hospital
shall--
``(A) submit to the Secretary an initial report, and
periodic updates at a frequency determined by the
Secretary, containing a detailed description of the
identity of each physician owner and physician investor
and any other owners or investors of the hospital;
``(B) require that any referring physician owner or
investor discloses to the individual being referred, by
a time that permits the individual to make a meaningful
decision regarding the receipt of services, as
determined by the Secretary, the ownership or
investment interest, as applicable, of such referring
physician in the hospital; and
``(C) disclose the fact that the hospital is
partially or wholly owned by one or more physicians or
has one or more physician investors--
``(i) on any public website for the hospital;
and
``(ii) in any public advertising for the
hospital.
The information to be reported or disclosed under this
paragraph shall be provided in such form, manner, and at such
times as the Secretary shall specify. The requirements of this
paragraph shall not apply to designated health services
furnished outside the United States or to entities which the
Secretary determines provide services for which payment may be
made under this title very infrequently.
``(3) Publication of information.--The Secretary shall
publish, and periodically update, the information submitted by
hospitals under paragraph (2)(A) on the public Internet website
of the Centers for Medicare & Medicaid Services.'';
(4) by amending subsection (g)(5) to read as follows:
``(5) Failure to report or disclose information.--
``(A) Reporting.--Any person who is required, but
fails, to meet a reporting requirement of paragraphs
(1) and (2)(A) of subsection (f) is subject to a civil
money penalty of not more than $10,000 for each day for
which reporting is required to have been made.
``(B) Disclosure.--Any physician who is required, but
fails, to meet a disclosure requirement of subsection
(f)(2)(B) or a hospital that is required, but fails, to
meet a disclosure requirement of subsection (f)(2)(C)
is subject to a civil money penalty of not more than
$10,000 for each case in which disclosure is required
to have been made.
``(C) Application.--The provisions of section 1128A
(other than the first sentence of subsection (a) and
other than subsection (b)) shall apply to a civil money
penalty under subparagraphs (A) and (B) in the same
manner as such provisions apply to a penalty or
proceeding under section 1128A(a).''; and
(5) by adding at the end the following new subsection:
``(i) Requirements to Qualify for Rural Provider and Hospital
Ownership Exceptions to Self-referral Prohibition.--
``(1) Requirements described.--For purposes of subsection
(d)(3)(D), the requirements described in this paragraph are as
follows:
``(A) Provider agreement.--The hospital had--
``(i) physician ownership or investment on
January 1, 2009; and
``(ii) a provider agreement under section
1866 in effect on such date.
``(B) Prohibition on physician ownership or
investment.--The percentage of the total value of the
ownership or investment interests held in the hospital,
or in an entity whose assets include the hospital, by
physician owners or investors in the aggregate does not
exceed such percentage as of the date of enactment of
this subsection.
``(C) Prohibition on expansion of facility
capacity.--Except as provided in paragraph (2), the
number of operating rooms, procedure rooms, or beds of
the hospital at any time on or after the date of the
enactment of this subsection are no greater than the
number of operating rooms, procedure rooms, or beds,
respectively, as of such date.
``(D) Ensuring bona fide ownership and investment.--
``(i) Any ownership or investment interests
that the hospital offers to a physician are not
offered on more favorable terms than the terms
offered to a person who is not in a position to
refer patients or otherwise generate business
for the hospital.
``(ii) The hospital (or any investors in the
hospital) does not directly or indirectly
provide loans or financing for any physician
owner or investor in the hospital.
``(iii) The hospital (or any investors in the
hospital) does not directly or indirectly
guarantee a loan, make a payment toward a loan,
or otherwise subsidize a loan, for any
physician owner or investor or group of
physician owners or investors that is related
to acquiring any ownership or investment
interest in the hospital.
``(iv) Ownership or investment returns are
distributed to each owner or investor in the
hospital in an amount that is directly
proportional to the ownership or investment
interest of such owner or investor in the
hospital.
``(v) The investment interest of the owner or
investor is directly proportional to the
owner's or investor's capital contributions
made at the time the ownership or investment
interest is obtained.
``(vi) Physician owners and investors do not
receive, directly or indirectly, any guaranteed
receipt of or right to purchase other business
interests related to the hospital, including
the purchase or lease of any property under the
control of other owners or investors in the
hospital or located near the premises of the
hospital.
``(vii) The hospital does not offer a
physician owner or investor the opportunity to
purchase or lease any property under the
control of the hospital or any other owner or
investor in the hospital on more favorable
terms than the terms offered to a person that
is not a physician owner or investor.
``(viii) The hospital does not condition any
physician ownership or investment interests
either directly or indirectly on the physician
owner or investor making or influencing
referrals to the hospital or otherwise
generating business for the hospital.
``(E) Patient safety.--In the case of a hospital that
does not offer emergency services, the hospital has the
capacity to--
``(i) provide assessment and initial
treatment for medical emergencies; and
``(ii) if the hospital lacks additional
capabilities required to treat the emergency
involved, refer and transfer the patient with
the medical emergency to a hospital with the
required capability.
``(F) Limitation on application to certain converted
facilities.--The hospital was not converted from an
ambulatory surgical center to a hospital on or after
the date of enactment of this subsection.
``(2) Exception to prohibition on expansion of facility
capacity.--
``(A) Process.--
``(i) Establishment.--The Secretary shall
establish and implement a process under which a
hospital may apply for an exception from the
requirement under paragraph (1)(C).
``(ii) Opportunity for community input.--The
process under clause (i) shall provide persons
and entities in the community in which the
hospital applying for an exception is located
with the opportunity to provide input with
respect to the application.
``(iii) Timing for implementation.--The
Secretary shall implement the process under
clause (i) on the date that is one month after
the promulgation of regulations described in
clause (iv).
``(iv) Regulations.--Not later than the first
day of the month beginning 18 months after the
date of the enactment of this subsection, the
Secretary shall promulgate regulations to carry
out the process under clause (i). The Secretary
may issue such regulations as interim final
regulations.
``(B) Frequency.--The process described in
subparagraph (A) shall permit a hospital to apply for
an exception up to once every 2 years.
``(C) Permitted increase.--
``(i) In general.--Subject to clause (ii) and
subparagraph (D), a hospital granted an
exception under the process described in
subparagraph (A) may increase the number of
operating rooms, procedure rooms, or beds of
the hospital above the baseline number of
operating rooms, procedure rooms, or beds,
respectively, of the hospital (or, if the
hospital has been granted a previous exception
under this paragraph, above the number of
operating rooms, procedure rooms, or beds,
respectively, of the hospital after the
application of the most recent increase under
such an exception).
``(ii) 100 percent increase limitation.--The
Secretary shall not permit an increase in the
number of operating rooms, procedure rooms, or
beds of a hospital under clause (i) to the
extent such increase would result in the number
of operating rooms, procedure rooms, or beds of
the hospital exceeding 200 percent of the
baseline number of operating rooms, procedure
rooms, or beds of the hospital.
``(iii) Baseline number of operating rooms,
procedure rooms, or beds.--In this paragraph,
the term `baseline number of operating rooms,
procedure rooms, or beds' means the number of
operating rooms, procedure rooms, or beds of a
hospital as of the date of enactment of this
subsection.
``(D) Increase limited to facilities on the main
campus of the hospital.--Any increase in the number of
operating rooms, procedure rooms, or beds of a hospital
pursuant to this paragraph may only occur in facilities
on the main campus of the hospital.
``(E) Conditions for approval of an increase in
facility capacity.--The Secretary may grant an
exception under the process described in subparagraph
(A) only to a hospital--
``(i) that is located in a county in which
the percentage increase in the population
during the most recent 5-year period for which
data are available is estimated to be at least
150 percent of the percentage increase in the
population growth of the State in which the
hospital is located during that period, as
estimated by Bureau of the Census and available
to the Secretary;
``(ii) whose annual percent of total
inpatient admissions that represent inpatient
admissions under the program under title XIX is
estimated to be equal to or greater than the
average percent with respect to such admissions
for all hospitals located in the county in
which the hospital is located;
``(iii) that does not discriminate against
beneficiaries of Federal health care programs
and does not permit physicians practicing at
the hospital to discriminate against such
beneficiaries;
``(iv) that is located in a State in which
the average bed capacity in the State is
estimated to be less than the national average
bed capacity;
``(v) that has an average bed occupancy rate
that is estimated to be greater than the
average bed occupancy rate in the State in
which the hospital is located; and
``(vi) that meets other conditions as
determined by the Secretary.
``(F) Procedure rooms.--In this subsection, the term
`procedure rooms' includes rooms in which
catheterizations, angiographies, angiograms, and
endoscopies are furnished, but such term shall not
include emergency rooms or departments (except for
rooms in which catheterizations, angiographies,
angiograms, and endoscopies are furnished).
``(G) Publication of final decisions.--Not later than
120 days after receiving a complete application under
this paragraph, the Secretary shall publish on the
public Internet website of the Centers for Medicare &
Medicaid Services the final decision with respect to
such application.
``(H) Limitation on review.--There shall be no
administrative or judicial review under section 1869,
section 1878, or otherwise of the exception process
under this paragraph, including the establishment of
such process, and any determination made under such
process.
``(3) Physician owner or investor defined.--For purposes of
this subsection and subsection (f)(2), the term `physician
owner or investor' means a physician (or an immediate family
member of such physician) with a direct or an indirect
ownership or investment interest in the hospital.
``(4) Patient safety requirement.--In the case of a hospital
to which the requirements of paragraph (1) apply, insofar as
the hospital admits a patient and does not have any physician
available on the premises 24 hours per day, 7 days per week,
before admitting the patient--
``(A) the hospital shall disclose such fact to the
patient; and
``(B) following such disclosure, the hospital shall
receive from the patient a signed acknowledgment that
the patient understands such fact.
``(5) Clarification.--Nothing in this subsection shall be
construed as preventing the Secretary from terminating a
hospital's provider agreement if the hospital is not in
compliance with regulations pursuant to section 1866.''.
(b) Verifying Compliance.--The Secretary of Health and Human Services
shall establish policies and procedures to verify compliance with the
requirements described in subsections (i)(1) and (i)(4) of section 1877
of the Social Security Act, as added by subsection (a)(5). The
Secretary may use unannounced site reviews of hospitals and audits to
verify compliance with such requirements.
(c) Implementation.--
(1) Funding.--For purposes of carrying out the amendments
made by subsection (a) and the provisions of subsection (b), in
addition to funds otherwise available, out of any funds in the
Treasury not otherwise appropriated there are appropriated to
the Secretary of Health and Human Services for the Centers for
Medicare & Medicaid Services Program Management Account
$5,000,000 for each fiscal year beginning with fiscal year
2010. Amounts appropriated under this paragraph for a fiscal
year shall be available until expended.
(2) Administration.--Chapter 35 of title 44, United States
Code, shall not apply to the amendments made by subsection (a)
and the provisions of subsection (b).
SEC. 1157. INSTITUTE OF MEDICINE STUDY OF GEOGRAPHIC ADJUSTMENT FACTORS
UNDER MEDICARE.
(a) In General.--The Secretary of Health and Human Services shall
enter into a contract with the Institute of Medicine of the National
Academy of Science to conduct a comprehensive empirical study, and
provide recommendations as appropriate, on the accuracy of the
geographic adjustment factors established under sections 1848(e) and
1886(d)(3)(E) of the Social Security Act (42 U.S.C. 1395w-4(e),
11395ww(d)(3)).
(b) Matters Included.--Such study shall include an evaluation and
assessment of the following with respect to such adjustment factors:
(1) Empirical validity of the adjustment factors.
(2) Methodology used to determine the adjustment factors.
(3) Measures used for the adjustment factors, taking into
account--
(A) timeliness of data and frequency of revisions to
such data;
(B) sources of data and the degree to which such data
are representative of costs; and
(C) operational costs of providers who participate in
Medicare.
(c) Evaluation.--Such study shall, within the context of the United
States health care marketplace, evaluate and consider the following:
(1) The effect of the adjustment factors on the level and
distribution of the health care workforce and resources,
including--
(A) recruitment and retention that takes into account
workforce mobility between urban and rural areas;
(B) ability of hospitals and other facilities to
maintain an adequate and skilled workforce; and
(C) patient access to providers and needed medical
technologies.
(2) The effect of the adjustment factors on population health
and quality of care.
(3) The effect of the adjustment factors on the ability of
providers to furnish efficient, high value care.
(d) Report.--The contract under subsection (a) shall provide for the
Institute of Medicine to submit, not later than one year after the date
of the enactment of this Act, to the Secretary and the Congress a
report containing results and recommendations of the study conducted
under this section.
(e) Funding.--There are authorized to be appropriated to carry out
this section such sums as may be necessary.
SEC. 1158. REVISION OF MEDICARE PAYMENT SYSTEMS TO ADDRESS GEOGRAPHIC
INEQUITIES. .
(a) In General.--Taking into account the recommendations described
in the report under section 1157(d), and notwithstanding the geographic
adjustments that would otherwise apply under sections 1848(e) and
1886(d)(3)(E) of the Social Security Act (42 U.S.C. 1395w-4(e),
1395ww(d)(3)(E)), the Secretary of Health and Human Services shall
include in proposed rules applicable to the rulemaking cycle for
payment systems for physicians' services and inpatient hospital
services under sections 1848 and 1886(d) of such Act, respectively,
proposals (as the Secretary determines to be appropriate) to revise the
geographic adjustment factors used in such systems. Such proposals
shall be contained in the next rulemaking cycle following the
submission to the Secretary of the report under section 1157(d).
(b) Payment Adjustments.--
(1) Funding for improvements.--The Secretary shall use funds
as provided under subsection (c) in making changes to the
geographic adjustment factors pursuant to subsection (a). In
making such changes to such geographic adjustment factors, the
Secretary shall ensure that the estimated increased
expenditures resulting from such changes does not exceed the
amounts provided under subsection (c).
(2) Ensuring fairness.--In carrying out this subsection, the
Secretary shall not reduce the geographic adjustment below the
factor that applied for such payment system in the payment year
before such changes.
(c) Funding.--Amounts in the Medicare Improvement Fund under section
1898, as amended by section 1146, shall be available to the Secretary
to make changes to the geographic adjustments factors as described in
subsections (a) and (b) with respect to services furnished before
January 1, 2014. No more than one-half of such amounts shall be
available with respect to services furnished in any one payment year.
Subtitle D--Medicare Advantage Reforms
PART 1--PAYMENT AND ADMINISTRATION
SEC. 1161. PHASE-IN OF PAYMENT BASED ON FEE-FOR-SERVICE COSTS.
Section 1853 of the Social Security Act (42 U.S.C. 1395w-23) is
amended--
(1) in subsection (j)(1)(A)--
(A) by striking ``beginning with 2007'' and inserting
``for 2007, 2008, 2009, and 2010''; and
(B) by inserting after ``(k)(1)'' the following: ``,
or, beginning with 2011, \1/12\ of the blended
benchmark amount determined under subsection (n)(1)'';
and
(2) by adding at the end the following new subsection:
``(n) Determination of Blended Benchmark Amount.--
``(1) In general.--For purposes of subsection (j), subject to
paragraphs (3) and (4), the term `blended benchmark amount'
means for an area--
``(A) for 2011 the sum of--
``(i) \2/3\ of the applicable amount (as
defined in subsection (k)) for the area and
year; and
``(ii) \1/3\ of the amount specified in
paragraph (2) for the area and year;
``(B) for 2012 the sum of--
``(i) \1/3\ of the applicable amount for the
area and year; and
``(ii) \2/3\ of the amount specified in
paragraph (2) for the area and year; and
``(C) for a subsequent year the amount specified in
paragraph (2) for the area and year.
``(2) Specified amount.--The amount specified in this
paragraph for an area and year is the amount specified in
subsection (c)(1)(D)(i) for the area and year adjusted (in a
manner specified by the Secretary) to take into account the
phase-out in the indirect costs of medical education from
capitation rates described in subsection (k)(4).
``(3) Fee-for-service payment floor.--In no case shall the
blended benchmark amount for an area and year be less than the
amount specified in paragraph (2).
``(4) Exception for pace plans.--This subsection shall not
apply to payments to a PACE program under section 1894.''.
SEC. 1162. QUALITY BONUS PAYMENTS.
(a) In General.--Section 1853 of the Social Security Act (42 U.S.C.
1395w-23), as amended by section 1161, is amended--
(1) in subsection (j), by inserting ``subject to subsection
(o),'' after ``For purposes of this part,''; and
(2) by adding at the end the following new subsection:
``(o) Quality Based Payment Adjustment.--
``(1) High quality plan adjustment.--For years beginning with
2011, in the case of a Medicare Advantage plan that is
identified (under paragraph (3)(E)(ii)) as a high quality MA
plan with respect to the year, the blended benchmark amount
under subsection (n)(1) shall be increased--
``(A) for 2011, by 1.0 percent;
``(B) for 2012, by 2.0 percent; and
``(C) for a subsequent year, by 3.0 percent.
``(2) Improved quality plan adjustment.--For years beginning
with 2011, in the case of a Medicare Advantage plan that is
identified (under paragraph (3)(E)(iii)) as an improved quality
MA plan with respect to the year, blended benchmark amount
under subsection (n)(1) shall be increased--
``(A) for 2011, by 0.33 percent;
``(B) for 2012, by 0.66 percent; and
``(C) for a subsequent year, by 1.0 percent.
``(3) Determinations of quality.--
``(A) Quality performance.--The Secretary shall
provide for the computation of a quality performance
score for each Medicare Advantage plan to be applied
for each year beginning with 2010.
``(B) Computation of score.--
``(i) For years before 2014.--For years
before 2014, the quality performance score for
a Medicare Advantage plan shall be computed
based on a blend (as designated by the
Secretary) of the plan's performance on--
``(I) HEDIS effectiveness of care
quality measures;
``(II) CAHPS quality measures; and
``(III) such other measures of
clinical quality as the Secretary may
specify.
Such measures shall be risk-adjusted as the
Secretary deems appropriate.
``(ii) Establishment of outcome-based
measures.--By not later than for 2013 the
Secretary shall implement reporting
requirements for quality under this section on
measures selected under clause (iii) that
reflect the outcomes of care experienced by
individuals enrolled in Medicare Advantage
plans (in addition to measures described in
clause (i)). Such measures may include--
``(I) measures of rates of admission
and readmission to a hospital;
``(II) measures of prevention
quality, such as those established by
the Agency for Healthcare Research and
Quality (that include hospital
admission rates for specified
conditions);
``(III) measures of patient mortality
and morbidity following surgery;
``(IV) measures of health functioning
(such as limitations on activities of
daily living) and survival for patients
with chronic diseases;
``(V) measures of patient safety; and
``(VI) other measure of outcomes and
patient quality of life as determined
by the Secretary.
Such measures shall be risk-adjusted as the
Secretary deems appropriate. In determining the
quality measures to be used under this clause,
the Secretary shall take into consideration the
recommendations of the Medicare Payment
Advisory Commission in its report to Congress
under section 168 of the Medicare Improvements
for Patients and Providers Act of 2008 (Public
Law 110-275) and shall provide preference to
measures collected on and comparable to
measures used in measuring quality under parts
A and B.
``(iii) Rules for selection of measures.--The
Secretary shall select measures for purposes of
clause (ii) consistent with the following:
``(I) The Secretary shall provide
preference to clinical quality measures
that have been endorsed by the entity
with a contract with the Secretary
under section 1890(a).
``(II) Prior to any measure being
selected under this clause, the
Secretary shall publish in the Federal
Register such measure and provide for a
period of public comment on such
measure.
``(iv) Transitional use of blend.--For
payments for 2014 and 2015, the Secretary may
compute the quality performance score for a
Medicare Advantage plan based on a blend of the
measures specified in clause (i) and the
measures described in clause (ii) and selected
under clause (iii).
``(v) Use of quality outcomes measures.--For
payments beginning with 2016, the preponderance
of measures used under this paragraph shall be
quality outcomes measures described in clause
(ii) and selected under clause (iii).
``(C) Data used in computing score.--Such score for
application for--
``(i) payments in 2011 shall be based on
quality performance data for plans for 2009;
and
``(ii) payments in 2012 and a subsequent year
shall be based on quality performance data for
plans for the second preceding year.
``(D) Reporting of data.--Each Medicare Advantage
organization shall provide for the reporting to the
Secretary of quality performance data described in
subparagraph (B) (in order to determine a quality
performance score under this paragraph) in such time
and manner as the Secretary shall specify.
``(E) Ranking of plans.--
``(i) Initial ranking.--Based on the quality
performance score described in subparagraph (B)
achieved with respect to a year, the Secretary
shall rank plan performance--
``(I) from highest to lowest based on
absolute scores; and
``(II) from highest to lowest based
on percentage improvement in the score
for the plan from the previous year.
A plan which does not report quality
performance data under subparagraph (D) shall
be counted, for purposes of such ranking, as
having the lowest plan performance and lowest
percentage improvement.
``(ii) Identification of high quality plans
in top quintile based on projected
enrollment.--The Secretary shall, based on the
scores for each plan under clause (i)(I) and
the Secretary's projected enrollment for each
plan and subject to clause (iv), identify those
Medicare Advantage plans with the highest score
that, based upon projected enrollment, are
projected to include in the aggregate 20
percent of the total projected enrollment for
the year. For purposes of this subsection, a
plan so identified shall be referred to in this
subsection as a `high quality MA plan'.
``(iii) Identification of improved quality
plans in top quintile based on projected
enrollment.--The Secretary shall, based on the
percentage improvement score for each plan
under clause (i)(II) and the Secretary's
projected enrollment for each plan and subject
to clause (iv), identify those Medicare
Advantage plans with the greatest percentage
improvement score that, based upon projected
enrollment, are projected to include in the
aggregate 20 percent of the total projected
enrollment for the year. For purposes of this
subsection, a plan so identified that is not a
high quality plan for the year shall be
referred to in this subsection as an `improved
quality MA plan'.
``(iv) Authority to disqualify certain
plans.--In applying clauses (ii) and (iii), the
Secretary may determine not to identify a
Medicare Advantage plan if the Secretary has
identified deficiencies in the plan's
compliance with rules for such plans under this
part.
``(F) Notification.--The Secretary, in the annual
announcement required under subsection (b)(1)(B) in
2011 and each succeeding year, shall notify the
Medicare Advantage organization that is offering a high
quality plan or an improved quality plan of such
identification for the year and the quality performance
payment adjustment for such plan for the year. The
Secretary shall provide for publication on the website
for the Medicare program of the information described
in the previous sentence.''.
SEC. 1163. EXTENSION OF SECRETARIAL CODING INTENSITY ADJUSTMENT
AUTHORITY.
Section 1853(a)(1)(C)(ii) of the Social Security Act (42 U.S.C.
1395w-23(a)(1)(C)(ii) is amended--
(1) in the matter before subclause (I), by striking ``through
2010'' and inserting ``and each subsequent year''; and
(2) in subclause (II)--
(A) by inserting ``periodically'' before ``conduct an
analysis'';
(B) by inserting ``on a timely basis'' after ``are
incorporated''; and
(C) by striking ``only for 2008, 2009, and 2010'' and
inserting ``for 2008 and subsequent years''.
SEC. 1164. SIMPLIFICATION OF ANNUAL BENEFICIARY ELECTION PERIODS.
(a) 2 Week Processing Period for Annual Enrollment Period (AEP).--
Paragraph (3)(B) of section 1851(e) of the Social Security Act (42
U.S.C. 1395w-21(e)) is amended--
(1) by striking ``and'' at the end of clause (iii);
(2) in clause (iv)--
(A) by striking ``and succeeding years'' and
inserting ``, 2008, 2009, and 2010''; and
(B) by striking the period at the end and inserting
``; and''; and
(3) by adding at the end the following new clause:
``(v) with respect to 2011 and succeeding
years, the period beginning on November 1 and
ending on December 15 of the year before such
year.''.
(b) Elimination of 3-month Additional Open Enrollment Period (OEP).--
Effective for plan years beginning with 2011, paragraph (2) of such
section is amended by striking subparagraph (C).
SEC. 1165. EXTENSION OF REASONABLE COST CONTRACTS.
Section 1876(h)(5)(C) of the Social Security Act (42 U.S.C.
1395mm(h)(5)(C)) is amended--
(1) in clause (ii), by striking ``January 1, 2010'' and
inserting ``January 1, 2012''; and
(2) in clause (iii), by striking ``the service area for the
year'' and inserting ``the portion of the plan's service area
for the year that is within the service area of a reasonable
cost reimbursement contract''.
SEC. 1166. LIMITATION OF WAIVER AUTHORITY FOR EMPLOYER GROUP PLANS.
(a) In General.--The first sentence of paragraph (2) of section
1857(i) of the Social Security Act (42 U.S.C. 1395w-27(i)) is amended
by inserting before the period at the end the following: ``, but only
if 90 percent of the Medicare Advantage eligible individuals enrolled
under such plan reside in a county in which the MA organization offers
an MA local plan''.
(b) Effective Date.--The amendment made by subsection (a) shall apply
for plan years beginning on or after January 1, 2011, and shall not
apply to plans which were in effect as of December 31, 2010.
SEC. 1167. IMPROVING RISK ADJUSTMENT FOR PAYMENTS.
(a) Report to Congress.--Not later than 1 year after the date of the
enactment of this Act, the Secretary of Health and Human Services shall
submit to Congress a report that evaluates the adequacy of the risk
adjustment system under section 1853(a)(1)(C) of the Social Security
Act (42 U.S.C. 1395-23(a)(1)(C)) in predicting costs for beneficiaries
with chronic or co-morbid conditions, beneficiaries dually-eligible for
Medicare and Medicaid, and non-Medicaid eligible low-income
beneficiaries; and the need and feasibility of including further
gradations of diseases or conditions and multiple years of beneficiary
data.
(b) Improvements to Risk Adjustment.--Not later than January 1, 2012,
the Secretary shall implement necessary improvements to the risk
adjustment system under section 1853(a)(1)(C) of the Social Security
Act (42 U.S.C. 1395-23(a)(1)(C)), taking into account the evaluation
under subsection (a).
SEC. 1168. ELIMINATION OF MA REGIONAL PLAN STABILIZATION FUND.
(a) In General.--Section 1858 of the Social Security Act (42 U.S.C.
1395w-27a) is amended by striking subsection (e).
(b) Transition.--Any amount contained in the MA Regional Plan
Stabilization Fund as of the date of the enactment of this Act shall be
transferred to the Federal Supplementary Medical Insurance Trust Fund.
SEC. 1169. STUDY REGARDING THE EFFECTS OF CALCULATING MEDICARE
ADVANTAGE PAYMENT RATES ON A REGIONAL AVERAGE OF
MEDICARE FEE FOR SERVICE RATES.
(a) In General.--The Administrator of the Centers for Medicare and
Medicaid Services shall conduct a study to determine the potential
effects of calculating Medicare Advantage payment rates on a more
aggregated geographic basis (such as metropolitan statistical areas or
other regional delineations) rather than using county boundaries. In
conducting such study, the Administrator shall consider whether such
alternative geographic basis would result in the following:
(1) Improvements in the quality of care.
(2) Greater equity among providers.
(3) More predictable benchmark amounts for Medicare advantage
plans.
(b) Consultations.--In conducting the study, the Administrator shall
consult with the following:
(1) Experts in health care financing.
(2) Representatives of foundations and other nonprofit
entities that have conducted or supported research on Medicare
financing issues.
(3) Representatives from Medicare Advantage plans.
(4) Such other entities or people as determined by the
Secretary.
(c) Report.--Not later than one year after the date of the enactment
of this Act, the Administrator shall transmit a report to the Congress
on the study conducted under this section. The report shall contain a
detailed statement of findings and conclusions of the study, together
with its recommendations for such legislation and administrative
actions as the Administrator considers appropriate.
PART 2--BENEFICIARY PROTECTIONS AND ANTI-FRAUD
SEC. 1171. LIMITATION ON COST-SHARING FOR INDIVIDUAL HEALTH SERVICES.
(a) In General.--Section 1852(a)(1) of the Social Security Act (42
U.S.C. 1395w-22(a)(1)) is amended--
(1) in subparagraph (A), by inserting before the period at
the end the following: ``with cost-sharing that is no greater
(and may be less) than the cost-sharing that would otherwise be
imposed under such program option'';
(2) in subparagraph (B)(i), by striking ``or an actuarially
equivalent level of cost-sharing as determined in this part'';
and
(3) by amending clause (ii) of subparagraph (B) to read as
follows:
``(ii) Permitting use of flat copayment or
per diem rate.--Nothing in clause (i) shall be
construed as prohibiting a Medicare Advantage
plan from using a flat copayment or per diem
rate, in lieu of the cost-sharing that would be
imposed under part A or B, so long as the
amount of the cost-sharing imposed does not
exceed the amount of the cost-sharing that
would be imposed under the respective part if
the individual were not enrolled in a plan
under this part.''.
(b) Limitation for Dual Eligibles and Qualified Medicare
Beneficiaries.--Section 1852(a) of such Act is amended to read as
follows:
``(7) Limitation on cost-sharing for dual eligibles and
qualified medicare beneficiaries.--In the case of a individual
who is a full-benefit dual eligible individual (as defined in
section 1935(c)(6)) or a qualified medicare beneficiary (as
defined in section 1905(p)(1)) who is enrolled in a Medicare
Advantage plan, the plan may not impose cost-sharing that
exceeds the amount of cost-sharing that would be permitted with
respect to the individual under this title and title XIX if the
individual were not enrolled with such plan.''.
(c) Effective Dates.--
(1) The amendments made by subsection (a) shall apply to plan
years beginning on or after January 1, 2011.
(2) The amendments made by subsection (b) shall apply to plan
years beginning on or after January 1, 2011.
SEC. 1172. CONTINUOUS OPEN ENROLLMENT FOR ENROLLEES IN PLANS WITH
ENROLLMENT SUSPENSION.
Section 1851(e)(4) of the Social Security Act (42 U.S.C. 1395w(e)(4))
is amended--
(1) in subparagraph (C), by striking at the end ``or'';
(2) in subparagraph (D)--
(A) by inserting ``, taking into account the health
or well-being of the individual'' before the period;
and
(B) by redesignating such subparagraph as
subparagraph (E); and
(3) by inserting after subparagraph (C) the following new
subparagraph:
``(D) the individual is enrolled in an MA plan and
enrollment in the plan is suspended under paragraph
(2)(B) or (3)(C) of section 1857(g) because of a
failure of the plan to meet applicable requirements;
or''.
SEC. 1173. INFORMATION FOR BENEFICIARIES ON MA PLAN ADMINISTRATIVE
COSTS.
(a) Disclosure of Medical Loss Ratios and Other Expense Data.--
Section 1851 of the Social Security Act (42 U.S.C. 1395w-21), as
previously amended by this subtitle, is amended by adding at the end
the following new subsection:
``(p) Publication of Medical Loss Ratios and Other Cost-related
Information.--
``(1) In general.--The Secretary shall publish, not later
than November 1 of each year (beginning with 2011), for each MA
plan contract, the medical loss ratio of the plan in the
previous year.
``(2) Submission of data.--
``(A) In general.--Each MA organization shall submit
to the Secretary, in a form and manner specified by the
Secretary, data necessary for the Secretary to publish
the medical loss ratio on a timely basis.
``(B) Data for 2010 and 2011.--The data submitted
under subparagraph (A) for 2010 and for 2011 shall be
consistent in content with the data reported as part of
the MA plan bid in June 2009 for 2010.
``(C) Use of standardized elements and definitions.--
The data to be submitted under subparagraph (A)
relating to medical loss ratio for a year, beginning
with 2012, shall be submitted based on the standardized
elements and definitions developed under paragraph (3).
``(3) Development of data reporting standards.--
``(A) In general.--The Secretary shall develop and
implement standardized data elements and definitions
for reporting under this subsection, for contract years
beginning with 2012, of data necessary for the
calculation of the medical loss ratio for MA plans. Not
later than December 31, 2010, the Secretary shall
publish a report describing the elements and
definitions so developed.
``(B) Consultation.--The Secretary shall consult with
the Health Choices Commissioner, representatives of MA
organizations, experts on health plan accounting
systems, and representatives of the National
Association of Insurance Commissioners, in the
development of such data elements and definitions.
``(4) Medical loss ratio to be defined.--For purposes of this
part, the term `medical loss ratio' has the meaning given such
term by the Secretary, taking into account the meaning given
such term by the Health Choices Commissioner under section 116
of the America's Affordable Health Choices Act of 2009.''.
(b) Minimum Medical Loss Ratio.--Section 1857(e) of the Social
Security Act (42 U.S.C. 1395w-27(e)) is amended by adding at the end
the following new paragraph:
``(4) Requirement for minimum medical loss ratio.--If the
Secretary determines for a contract year (beginning with 2014)
that an MA plan has failed to have a medical loss ratio (as
defined in section 1851(p)(4)) of at least .85--
``(A) the Secretary shall require the Medicare
Advantage organization offering the plan to give
enrollees a rebate (in the second succeeding contract
year) of premiums under this part (or part B or part D,
if applicable) by such amount as would provide for a
benefits ratio of at least .85;
``(B) for 3 consecutive contract years, the Secretary
shall not permit the enrollment of new enrollees under
the plan for coverage during the second succeeding
contract year; and
``(C) the Secretary shall terminate the plan contract
if the plan fails to have such a medical loss ratio for
5 consecutive contract years.''.
SEC. 1174. STRENGTHENING AUDIT AUTHORITY.
(a) For Part C Payments Risk Adjustment.--Section 1857(d)(1) of the
Social Security Act (42 U.S.C. 1395w-27(d)(1)) is amended by inserting
after ``section 1858(c))'' the following: ``, and data submitted with
respect to risk adjustment under section 1853(a)(3)''.
(b) Enforcement of Audits and Deficiencies.--
(1) In general.--Section 1857(e) of such Act, as amended by
section 1173, is amended by adding at the end the following new
paragraph:
``(5) Enforcement of audits and deficiencies.--
``(A) Information in contract.--The Secretary shall
require that each contract with an MA organization
under this section shall include terms that inform the
organization of the provisions in subsection (d).
``(B) Enforcement authority.--The Secretary is
authorized, in connection with conducting audits and
other activities under subsection (d), to take such
actions, including pursuit of financial recoveries,
necessary to address deficiencies identified in such
audits or other activities.''.
(2) Application under part d.--For provision applying the
amendment made by paragraph (1) to prescription drug plans
under part D, see section 1860D-12(b)(3)(D) of the Social
Security Act.
(c) Effective Date.--The amendments made by this section shall take
effect on the date of the enactment of this Act and shall apply to
audits and activities conducted for contract years beginning on or
after January 1, 2011.
SEC. 1175. AUTHORITY TO DENY PLAN BIDS.
(a) In General.--Section 1854(a)(5) of the Social Security Act (42
U.S.C. 1395w-24(a)(5)) is amended by adding at the end the following
new subparagraph:
``(C) Rejection of bids.--Nothing in this section
shall be construed as requiring the Secretary to accept
any or every bid by an MA organization under this
subsection.''.
(b) Application Under Part D.--Section 1860D-11(d) of such Act (42
U.S.C. 1395w-111(d)) is amended by adding at the end the following new
paragraph:
``(3) Rejection of bids.--Paragraph (5)(C) of section 1854(a)
shall apply with respect to bids under this section in the same
manner as it applies to bids by an MA organization under such
section.''.
(c) Effective Date.--The amendments made by this section shall apply
to bids for contract years beginning on or after January 1, 2011.
PART 3--TREATMENT OF SPECIAL NEEDS PLANS
SEC. 1176. LIMITATION ON ENROLLMENT OUTSIDE OPEN ENROLLMENT PERIOD OF
INDIVIDUALS INTO CHRONIC CARE SPECIALIZED MA PLANS
FOR SPECIAL NEEDS INDIVIDUALS.
Section 1859(f)(4) of the Social Security Act (42 U.S.C. 1395w-
28(f)(4)) is amended by adding at the end the following new
subparagraph:
``(C) The plan does not enroll an individual on or
after January 1, 2011, other than during an annual,
coordinated open enrollment period or when at the time
of the diagnosis of the disease or condition that
qualifies the individual as an individual described in
subsection (b)(6)(B)(iii).''.
SEC. 1177. EXTENSION OF AUTHORITY OF SPECIAL NEEDS PLANS TO RESTRICT
ENROLLMENT.
(a) In General.--Section 1859(f)(1) of the Social Security Act (42
U.S.C. 1395w-28(f)(1)) is amended by striking ``January 1, 2011'' and
inserting ``January 1, 2013 (or January 1, 2016, in the case of a plan
described in section 1177(b)(1) of the America's Affordable Health
Choices Act of 2009)''.
(b) Grandfathering of Certain Plans.--
(1) Plans described.--For purposes of section 1859(f)(1) of
the Social Security Act (42 U.S.C. 1395w-28(f)(1)), a plan
described in this paragraph is a plan that had a contract with
a State that had a State program to operate an integrated
Medicaid-Medicare program that had been approved by the Centers
for Medicare & Medicaid Services as of January 1, 2004.
(2) Analysis; report.--The Secretary of Health and Human
Services shall provide, through a contract with an independent
health services evaluation organization, for an analysis of the
plans described in paragraph (1) with regard to the impact of
such plans on cost, quality of care, patient satisfaction, and
other subjects as specified by the Secretary. Not later than
December 31, 2011, the Secretary shall submit to Congress a
report on such analysis and shall include in such report such
recommendations with regard to the treatment of such plans as
the Secretary deems appropriate.
Subtitle E--Improvements to Medicare Part D
SEC. 1181. ELIMINATION OF COVERAGE GAP.
(a) In General.--Section 1860D-2(b) of such Act (42 U.S.C. 1395w-
102(b)) is amended--
(1) in paragraph (3)(A), by striking ``paragraph (4)'' and
inserting ``paragraphs (4) and (7)'';
(2) in paragraph (4)(B)(i), by inserting ``subject to
paragraph (7),'' after ``purposes of this part,''; and
(3) by adding at the end the following new paragraph:
``(7) Phased-in elimination of coverage gap.--
``(A) In general.--For each year beginning with 2011,
the Secretary shall consistent with this paragraph
progressively increase the initial coverage limit
(described in subsection (b)(3)) and decrease the
annual out-of-pocket threshold from the amounts
otherwise computed until there is a continuation of
coverage from the initial coverage limit for
expenditures incurred through the total amount of
expenditures at which benefits are available under
paragraph (4).
``(B) Increase in initial coverage limit.--For a year
beginning with 2011, the initial coverage limit
otherwise computed without regard to this paragraph
shall be increased by \1/2\ of the cumulative phase-in
percentage (as defined in subparagraph (D)(ii) for the
year) times the out-of-pocket gap amount (as defined in
subparagraph (E)) for the year.
``(C) Decrease in annual out-of-pocket threshold.--
For a year beginning with 2011, the annual out-of-
pocket threshold otherwise computed without regard to
this paragraph shall be decreased by \1/2\ of the
cumulative phase-in percentage of the out-of-pocket gap
amount for the year multiplied by 1.75.
``(D) Phase-in.--For purposes of this paragraph:
``(i) Annual phase-in percentage.--The term
`annual phase-in percentage' means--
``(I) for 2011, 13 percent;
``(II) for 2012, 2013, 2014, and
2015, 5 percent;
``(III) for 2016 through 2018, 7.5
percent; and
``(IV) for 2019 and each subsequent
year, 10 percent.
``(ii) Cumulative phase-in percentage.--The
term `cumulative phase-in percentage' means for
a year the sum of the annual phase-in
percentage for the year and the annual phase-in
percentages for each previous year beginning
with 2011, but in no case more than 100
percent.
``(E) Out-of-pocket gap amount.--For purposes of this
paragraph, the term `out-of-pocket gap amount' means
for a year the amount by which--
``(i) the annual out-of-pocket threshold
specified in paragraph (4)(B) for the year (as
determined as if this paragraph did not apply),
exceeds
``(ii) the sum of--
``(I) the annual deductible under
paragraph (1) for the year; and
``(II) \1/4\ of the amount by which
the initial coverage limit under
paragraph (3) for the year (as
determined as if this paragraph did not
apply) exceeds such annual
deductible.''.
(b) Requiring Drug Manufacturers to Provide Drug Rebates for Full-
benefit Dual Eligibles.--
(1) In general.--Section 1860D-2 of the Social Security Act
(42 U.S.C. 1396r-8) is amended--
(A) in subsection (e)(1), in the matter before
subparagraph (A), by inserting ``and subsection (f)''
after ``this subsection''; and
(B) by adding at the end the following new
subsection:
``(f) Prescription Drug Rebate Agreement for Full-benefit Dual
Eligible Individuals.--
``(1) In general.--In this part, the term `covered part D
drug' does not include any drug or biologic that is
manufactured by a manufacturer that has not entered into and
have in effect a rebate agreement described in paragraph (2).
``(2) Rebate agreement.--A rebate agreement under this
subsection shall require the manufacturer to provide to the
Secretary a rebate for each rebate period (as defined in
paragraph (6)(B)) ending after December 31, 2010, in the amount
specified in paragraph (3) for any covered part D drug of the
manufacturer dispensed after December 31, 2010, to any full-
benefit dual eligible individual (as defined in paragraph
(6)(A)) for which payment was made by a PDP sponsor under part
D or a MA organization under part C for such period. Such
rebate shall be paid by the manufacturer to the Secretary not
later than 30 days after the date of receipt of the information
described in section 1860D-12(b)(7), including as such section
is applied under section 1857(f)(3).
``(3) Rebate for full-benefit dual eligible medicare drug
plan enrollees.--
``(A) In general.--The amount of the rebate specified
under this paragraph for a manufacturer for a rebate
period, with respect to each dosage form and strength
of any covered part D drug provided by such
manufacturer and dispensed to a full-benefit dual
eligible individual, shall be equal to the product of--
``(i) the total number of units of such
dosage form and strength of the drug so
provided and dispensed for which payment was
made by a PDP sponsor under part D or a MA
organization under part C for the rebate period
(as reported under section 1860D-12(b)(7),
including as such section is applied under
section 1857(f)(3)); and
``(ii) the amount (if any) by which--
``(I) the Medicaid rebate amount (as
defined in subparagraph (B)) for such
form, strength, and period, exceeds
``(II) the average Medicare drug
program full-benefit dual eligible
rebate amount (as defined in
subparagraph (C)) for such form,
strength, and period.
``(B) Medicaid rebate amount.--For purposes of this
paragraph, the term `Medicaid rebate amount' means,
with respect to each dosage form and strength of a
covered part D drug provided by the manufacturer for a
rebate period--
``(i) in the case of a single source drug or
an innovator multiple source drug, the amount
specified in paragraph (1)(A)(ii) of section
1927(c) plus the amount, if any, specified in
paragraph (2)(A)(ii) of such section, for such
form, strength, and period; or
``(ii) in the case of any other covered
outpatient drug, the amount specified in
paragraph (3)(A)(i) of such section for such
form, strength, and period.
``(C) Average medicare drug program full-benefit dual
eligible rebate amount.--For purposes of this
subsection, the term `average Medicare drug program
full-benefit dual eligible rebate amount' means, with
respect to each dosage form and strength of a covered
part D drug provided by a manufacturer for a rebate
period, the sum, for all PDP sponsors under part D and
MA organizations administering a MA-PD plan under part
C, of--
``(i) the product, for each such sponsor or
organization, of--
``(I) the sum of all rebates,
discounts, or other price concessions
(not taking into account any rebate
provided under paragraph (2) for such
dosage form and strength of the drug
dispensed, calculated on a per-unit
basis, but only to the extent that any
such rebate, discount, or other price
concession applies equally to drugs
dispensed to full-benefit dual eligible
Medicare drug plan enrollees and drugs
dispensed to PDP and MA-PD enrollees
who are not full-benefit dual eligible
individuals; and
``(II) the number of the units of
such dosage and strength of the drug
dispensed during the rebate period to
full-benefit dual eligible individuals
enrolled in the prescription drug plans
administered by the PDP sponsor or the
MA-PD plans administered by the MA-PD
organization; divided by
``(ii) the total number of units of such
dosage and strength of the drug dispensed
during the rebate period to full-benefit dual
eligible individuals enrolled in all
prescription drug plans administered by PDP
sponsors and all MA-PD plans administered by
MA-PD organizations.
``(4) Length of agreement.--The provisions of paragraph (4)
of section 1927(b) (other than clauses (iv) and (v) of
subparagraph (B)) shall apply to rebate agreements under this
subsection in the same manner as such paragraph applies to a
rebate agreement under such section.
``(5) Other terms and conditions.--The Secretary shall
establish other terms and conditions of the rebate agreement
under this subsection, including terms and conditions related
to compliance, that are consistent with this subsection.
``(6) Definitions.--In this subsection and section 1860D-
12(b)(7):
``(A) Full-benefit dual eligible individual.--The
term `full-benefit dual eligible individual' has the
meaning given such term in section 1935(c)(6).
``(B) Rebate period.--The term `rebate period' has
the meaning given such term in section 1927(k)(8).''.
(2) Reporting requirement for the determination and payment
of rebates by manufactures related to rebate for full-benefit
dual eligible medicare drug plan enrollees.--
(A) Requirements for pdp sponsors.--Section 1860D-
12(b) of the Social Security Act (42 U.S.C. 1395w-
112(b)) is amended by adding at the end the following
new paragraph:
``(7) Reporting requirement for the determination and payment
of rebates by manufacturers related to rebate for full-benefit
dual eligible medicare drug plan enrollees.--
``(A) In general.--For purposes of the rebate under
section 1860D-2(f) for contract years beginning on or
after January 1, 2011, each contract entered into with
a PDP sponsor under this part with respect to a
prescription drug plan shall require that the sponsor
comply with subparagraphs (B) and (C).
``(B) Report form and contents.--Not later than 60
days after the end of each rebate period (as defined in
section 1860D-2(f)(6)(B)) within such a contract year
to which such section applies, a PDP sponsor of a
prescription drug plan under this part shall report to
each manufacturer--
``(i) information (by National Drug Code
number) on the total number of units of each
dosage, form, and strength of each drug of such
manufacturer dispensed to full-benefit dual
eligible Medicare drug plan enrollees under any
prescription drug plan operated by the PDP
sponsor during the rebate period;
``(ii) information on the price discounts,
price concessions, and rebates for such drugs
for such form, strength, and period;
``(iii) information on the extent to which
such price discounts, price concessions, and
rebates apply equally to full-benefit dual
eligible Medicare drug plan enrollees and PDP
enrollees who are not full-benefit dual
eligible Medicare drug plan enrollees; and
``(iv) any additional information that the
Secretary determines is necessary to enable the
Secretary to calculate the average Medicare
drug program full-benefit dual eligible rebate
amount (as defined in paragraph (3)(C) of such
section), and to determine the amount of the
rebate required under this section, for such
form, strength, and period.
Such report shall be in a form consistent with a
standard reporting format established by the Secretary.
``(C) Submission to secretary.--Each PDP sponsor
shall promptly transmit a copy of the information
reported under subparagraph (B) to the Secretary for
the purpose of audit oversight and evaluation.
``(D) Confidentiality of information.--The provisions
of subparagraph (D) of section 1927(b)(3), relating to
confidentiality of information, shall apply to
information reported by PDP sponsors under this
paragraph in the same manner that such provisions apply
to information disclosed by manufacturers or
wholesalers under such section, except--
``(i) that any reference to `this section' in
clause (i) of such subparagraph shall be
treated as being a reference to this section;
``(ii) the reference to the Director of the
Congressional Budget Office in clause (iii) of
such subparagraph shall be treated as including
a reference to the Medicare Payment Advisory
Commission; and
``(iii) clause (iv) of such subparagraph
shall not apply.
``(E) Oversight.--Information reported under this
paragraph may be used by the Inspector General of the
Department of Health and Human Services for the
statutorily authorized purposes of audit,
investigation, and evaluations.
``(F) Penalties for failure to provide timely
information and provision of false information.--In the
case of a PDP sponsor--
``(i) that fails to provide information
required under subparagraph (B) on a timely
basis, the sponsor is subject to a civil money
penalty in the amount of $10,000 for each day
in which such information has not been
provided; or
``(ii) that knowingly (as defined in section
1128A(i)) provides false information under such
subparagraph, the sponsor is subject to a civil
money penalty in an amount not to exceed
$100,000 for each item of false information.
Such civil money penalties are in addition to other
penalties as may be prescribed by law. The provisions
of section 1128A (other than subsections (a) and (b))
shall apply to a civil money penalty under this
subparagraph in the same manner as such provisions
apply to a penalty or proceeding under section
1128A(a).''.
(B) Application to ma organizations.--Section
1857(f)(3) of the Social Security Act (42 U.S.C. 1395w-
27(f)(3)) is amended by adding at the end the
following:
``(D) Reporting requirement related to rebate for
full-benefit dual eligible medicare drug plan
enrollees.--Section 1860D-12(b)(7).''.
(3) Deposit of rebates into medicare prescription drug
account.--Section 1860D-16(c) of such Act (42 U.S.C. 1395w-
116(c)) is amended by adding at the end the following new
paragraph:
``(6) Rebate for full-benefit dual eligible medicare drug
plan enrollees.--Amounts paid under a rebate agreement under
section 1860D-2(f) shall be deposited into the Account and
shall be used to pay for all or part of the gradual elimination
of the coverage gap under section 1860D-2(b)(7).''.
SEC. 1182. DISCOUNTS FOR CERTAIN PART D DRUGS IN ORIGINAL COVERAGE GAP.
Section 1860D-2 of the Social Security Act (42 U.S.C. 1395w-102), as
amended by section 1181, is amended--
(1) in subsection (b)(4)(C)(ii), by inserting ``subject to
subsection (g)(2)(C),'' after ``(ii)'';
(2) in subsection (e)(1), in the matter before subparagraph
(A), by striking ``subsection (f)'' and inserting ``subsections
(f) and (g)''; and
(3) by adding at the end the following new subsection:
``(g) Requirement for Manufacturer Discount Agreement for Certain
Qualifying Drugs.--
``(1) In general.--In this part, the term `covered part D
drug' does not include any drug or biologic that is
manufactured by a manufacturer that has not entered into and
have in effect for all qualifying drugs (as defined in
paragraph (5)(A)) a discount agreement described in paragraph
(2).
``(2) Discount agreement.--
``(A) Periodic discounts.--A discount agreement under
this paragraph shall require the manufacturer involved
to provide, to each PDP sponsor with respect to a
prescription drug plan or each MA organization with
respect to each MA-PD plan, a discount in an amount
specified in paragraph (3) for qualifying drugs (as
defined in paragraph (5)(A)) of the manufacturer
dispensed to a qualifying enrollee after December 31,
2010, insofar as the individual is in the original gap
in coverage (as defined in paragraph (5)(E)).
``(B) Discount agreement.--Insofar as not
inconsistent with this subsection, the Secretary shall
establish terms and conditions of such agreement,
including terms and conditions relating to compliance,
similar to the terms and conditions for rebate
agreements under paragraphs (2), (3), and (4) of
section 1927(b), except that--
``(i) discounts shall be applied under this
subsection to prescription drug plans and MA-PD
plans instead of State plans under title XIX;
``(ii) PDP sponsors and MA organizations
shall be responsible, instead of States, for
provision of necessary utilization information
to drug manufacturers; and
``(iii) sponsors and MA organizations shall
be responsible for reporting information on
drug-component negotiated price, instead of
other manufacturer prices.
``(C) Counting discount toward true out-of-pocket
costs.--Under the discount agreement, in applying
subsection (b)(4), with regard to subparagraph (C)(i)
of such subsection, if a qualified enrollee purchases
the qualified drug insofar as the enrollee is in an
actual gap of coverage (as defined in paragraph
(5)(D)), the amount of the discount under the agreement
shall be treated and counted as costs incurred by the
plan enrollee.
``(3) Discount amount.--The amount of the discount specified
in this paragraph for a discount period for a plan is equal to
50 percent of the amount of the drug-component negotiated price
(as defined in paragraph (5)(C)) for qualifying drugs for the
period involved.
``(4) Additional terms.--In the case of a discount provided
under this subsection with respect to a prescription drug plan
offered by a PDP sponsor or an MA-PD plan offered by an MA
organization, if a qualified enrollee purchases the qualified
drug--
``(A) insofar as the enrollee is in an actual gap of
coverage (as defined in paragraph (5)(D)), the sponsor
or plan shall provide the discount to the enrollee at
the time the enrollee pays for the drug; and
``(B) insofar as the enrollee is in the portion of
the original gap in coverage (as defined in paragraph
(5)(E)) that is not in the actual gap in coverage, the
discount shall not be applied against the negotiated
price (as defined in subsection (d)(1)(B)) for the
purpose of calculating the beneficiary payment.
``(5) Definitions.--In this subsection:
``(A) Qualifying drug.--The term `qualifying drug'
means, with respect to a prescription drug plan or MA-
PD plan, a drug or biological product that--
``(i)(I) is a drug produced or distributed
under an original new drug application approved
by the Food and Drug Administration, including
a drug product marketed by any cross-licensed
producers or distributors operating under the
new drug application;
``(II) is a drug that was originally marketed
under an original new drug application approved
by the Food and Drug Administration; or
``(III) is a biological product as approved
under section 351(a) of the Public Health
Services Act;
``(ii) is covered under the formulary of the
plan; and
``(iii) is dispensed to an individual who is
in the original gap in coverage.
``(B) Qualifying enrollee.--The term `qualifying
enrollee' means an individual enrolled in a
prescription drug plan or MA-PD plan other than such an
individual who is a subsidy-eligible individual (as
defined in section 1860D-14(a)(3)).
``(C) Drug-component negotiated price.--The term
`drug-component negotiated price' means, with respect
to a qualifying drug, the negotiated price (as defined
in subsection (d)(1)(B)), as determined without regard
to any dispensing fee, of the drug under the
prescription drug plan or MA-PD plan involved.
``(D) Actual gap in coverage.--The term `actual gap
in coverage' means the gap in prescription drug
coverage that occurs between the initial coverage limit
(as modified under subparagraph (B) of subsection
(b)(7)) and the annual out-of-pocket threshold (as
modified under subparagraph (C) of such subsection).
``(E) Original gap in coverage.--The term `original
in gap coverage' means the gap in prescription drug
coverage that would occur between the initial coverage
limit (described in subsection (b)(3)) and the annual
out-of-pocket threshold (as defined in subsection
(b)(4)(B)) if subsection (b)(7) did not apply.''.
SEC. 1183. REPEAL OF PROVISION RELATING TO SUBMISSION OF CLAIMS BY
PHARMACIES LOCATED IN OR CONTRACTING WITH LONG-TERM
CARE FACILITIES.
(a) Part D Submission.--Section 1860D-12(b) of the Social Security
Act (42 U.S.C. 1395w-112(b)), as amended by section 172(a)(1) of Public
Law 110-275, is amended by striking paragraph (5) and redesignating
paragraph (6) and paragraph (7), as added by section 1181(b)(2), as
paragraph (5) and paragraph (6), respectively.
(b) Submission to MA-PD Plans.--Section 1857(f)(3) of the Social
Security Act (42 U.S.C. 1395w-27(f)(3)), as added by section 171(b) of
Public Law 110-275 and amended by section 172(a)(2) of such Public Law
and section 1181 of this Act, is amended by striking subparagraph (B)
and redesignating subparagraphs (C) and (D) as subparagraphs (B) and
(C), respectively.
(c) Effective Date.--The amendments made by this section shall apply
for contract years beginning with 2010.
SEC. 1184. INCLUDING COSTS INCURRED BY AIDS DRUG ASSISTANCE PROGRAMS
AND INDIAN HEALTH SERVICE IN PROVIDING PRESCRIPTION
DRUGS TOWARD THE ANNUAL OUT-OF-POCKET THRESHOLD
UNDER PART D.
(a) In General.--Section 1860D-2(b)(4)(C) of the Social Security Act
(42 U.S.C. 1395w-102(b)(4)(C)) is amended--
(1) in clause (i), by striking ``and'' at the end;
(2) in clause (ii)--
(A) by striking ``such costs shall be treated as
incurred only if'' and inserting ``subject to clause
(iii), such costs shall be treated as incurred only
if'';
(B) by striking ``, under section 1860D-14, or under
a State Pharmaceutical Assistance Program''; and
(C) by striking the period at the end and inserting
``; and''; and
(3) by inserting after clause (ii) the following new clause:
``(iii) such costs shall be treated as
incurred and shall not be considered to be
reimbursed under clause (ii) if such costs are
borne or paid--
``(I) under section 1860D-14;
``(II) under a State Pharmaceutical
Assistance Program;
``(III) by the Indian Health Service,
an Indian tribe or tribal organization,
or an urban Indian organization (as
defined in section 4 of the Indian
Health Care Improvement Act); or
``(IV) under an AIDS Drug Assistance
Program under part B of title XXVI of
the Public Health Service Act.''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to costs incurred on or after January 1, 2011.
SEC. 1185. PERMITTING MID-YEAR CHANGES IN ENROLLMENT FOR FORMULARY
CHANGES THAT ADVERSELY IMPACT AN ENROLLEE.
(a) In General.--Section 1860D-1(b)(3) of the Social Security Act (42
U.S.C. 1395w-101(b)(3)) is amended by adding at the end the following
new subparagraph:
``(F) Change in formulary resulting in increase in
cost-sharing.--
``(i) In general.--Except as provided in
clause (ii), in the case of an individual
enrolled in a prescription drug plan (or MA-PD
plan) who has been prescribed and is using a
covered part D drug while so enrolled, if the
formulary of the plan is materially changed
(other than at the end of a contract year) so
to reduce the coverage (or increase the cost-
sharing) of the drug under the plan.
``(ii) Exception.--Clause (i) shall not apply
in the case that a drug is removed from the
formulary of a plan because of a recall or
withdrawal of the drug issued by the Food and
Drug Administration, because the drug is
replaced with a generic drug that is a
therapeutic equivalent, or because of
utilization management applied to--
``(I) a drug whose labeling includes
a boxed warning required by the Food
and Drug Administration under section
210.57(c)(1) of title 21, Code of
Federal Regulations (or a successor
regulation); or
``(II) a drug required under
subsection (c)(2) of section 505-1 of
the Federal Food, Drug, and Cosmetic
Act to have a Risk Evaluation and
Management Strategy that includes
elements under subsection (f) of such
section.''.
(b) Effective Date.--The amendment made by subsection (a) shall apply
to contract years beginning on or after January 1, 2011.
SEC. 1186. NEGOTIATION OF LOWER COVERED PART D DRUG PRICES ON BEHALF OF
MEDICARE BENEFICIARIES.
(a) Negotiation by Secretary.--Section 1860D-11 of the Social
Security Act (42 U.S.C. 1395w-111) is amended by striking subsection
(i) (relating to noninterference) and inserting the following:
``(i) Negotiation of Lower Drug Prices.--
``(1) In general.--Notwithstanding any other provision of
law, the Secretary shall negotiate with pharmaceutical
manufacturers the prices (including discounts, rebates, and
other price concessions) that may be charged to PDP sponsors
and MA organizations for covered part D drugs for part D
eligible individuals who are enrolled under a prescription drug
plan or under an MA-PD plan.
``(2) No change in rules for formularies.--
``(A) In general.--Nothing in paragraph (1) shall be
construed to authorize the Secretary to establish or
require a particular formulary.
``(B) Construction.--Subparagraph (A) shall not be
construed as affecting the Secretary's authority to
ensure appropriate and adequate access to covered part
D drugs under prescription drug plans and under MA-PD
plans, including compliance of such plans with
formulary requirements under section 1860D-4(b)(3).
``(3) Construction.--Nothing in this subsection shall be
construed as preventing the sponsor of a prescription drug
plan, or an organization offering an MA-PD plan, from obtaining
a discount or reduction of the price for a covered part D drug
below the price negotiated under paragraph (1).
``(4) Semi-annual reports to congress.--Not later than June
1, 2011, and every six months thereafter, the Secretary shall
submit to the Committees on Ways and Means, Energy and
Commerce, and Oversight and Government Reform of the House of
Representatives and the Committee on Finance of the Senate a
report on negotiations conducted by the Secretary to achieve
lower prices for Medicare beneficiaries, and the prices and
price discounts achieved by the Secretary as a result of such
negotiations.''.
(b) Effective Date.--The amendment made by subsection (a) shall take
effect on the date of the enactment of this Act and shall first apply
to negotiations and prices for plan years beginning on January 1, 2011.
SEC. 1187. STATE CERTIFICATION PRIOR TO WAIVER OF LICENSURE
REQUIREMENTS UNDER MEDICARE PRESCRIPTION DRUG
PROGRAM.
(a) In General.--Section 1860D-12(c) of the Social Security Act (42
U.S.C. 1395w-112(c)) is amended--
(1) in paragraph (1)(A), by striking ``In the case'' and
inserting ``Subject to paragraph (5), in the case''; and
(2) by adding at the end the following new paragraph:
``(5) State certification required.--
``(A) In general.--The Secretary may only grant a
waiver under paragraph (1)(A) if the Secretary has
received a certification from the State insurance
commissioner that the prescription drug plan has a
substantially complete application pending in the
State.
``(B) Revocation of waiver upon finding of fraud and
abuse.--The Secretary shall revoke a waiver granted
under paragraph (1)(A) if the State insurance
commissioner submits a certification to the Secretary
that the recipient of such a waiver--
``(i) has committed fraud or abuse with
respect to such waiver;
``(ii) has failed to make a good faith effort
to satisfy State licensing requirements; or
``(iii) was determined ineligible for
licensure by the State.''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply with respect to plan years beginning on or after January 1, 2010.
Subtitle F--Medicare Rural Access Protections
SEC. 1191. TELEHEALTH EXPANSION AND ENHANCEMENTS. .
(a) Additional Telehealth Site.--
(1) In general.--Paragraph (4)(C)(ii) of section 1834(m) of
the Social Security Act (42 U.S.C. 1395m(m)) is amended by
adding at the end the following new subclause:
``(IX) A renal dialysis facility.''
(2) Effective date.--The amendment made by paragraph (1)
shall apply to services furnished on or after January 1, 2011.
(b) Telehealth Advisory Committee.--
(1) Establishment.--Section 1868 of the Social Security Act
(42 U.S.C. 1395ee) is amended--
(A) in the heading, by adding at the end the
following: ``telehealth advisory committee''; and
(B) by adding at the end the following new
subsection:
``(c) Telehealth Advisory Committee.--
``(1) In general.--The Secretary shall appoint a Telehealth
Advisory Committee (in this subsection referred to as the
`Advisory Committee') to make recommendations to the Secretary
on policies of the Centers for Medicare & Medicaid Services
regarding telehealth services as established under section
1834(m), including the appropriate addition or deletion of
services (and HCPCS codes) to those specified in paragraphs
(4)(F)(i) and (4)(F)(ii) of such section and for authorized
payment under paragraph (1) of such section.
``(2) Membership; terms.--
``(A) Membership.--
``(i) In general.--The Advisory Committee
shall be composed of 9 members, to be appointed
by the Secretary, of whom--
``(I) 5 shall be practicing
physicians;
``(II) 2 shall be practicing non-
physician health care practitioners;
and
``(III) 2 shall be administrators of
telehealth programs.
``(ii) Requirements for appointing members.--
In appointing members of the Advisory
Committee, the Secretary shall--
``(I) ensure that each member has
prior experience with the practice of
telemedicine or telehealth;
``(II) give preference to individuals
who are currently providing
telemedicine or telehealth services or
who are involved in telemedicine or
telehealth programs;
``(III) ensure that the membership of
the Advisory Committee represents a
balance of specialties and geographic
regions; and
``(IV) take into account the
recommendations of stakeholders.
``(B) Terms.--The members of the Advisory Committee
shall serve for such term as the Secretary may specify.
``(C) Conflicts of interest.--An advisory committee
member may not participate with respect to a particular
matter considered in an advisory committee meeting if
such member (or an immediate family member of such
member) has a financial interest that could be affected
by the advice given to the Secretary with respect to
such matter.
``(3) Meetings.--The Advisory Committee shall meet twice each
calendar year and at such other times as the Secretary may
provide.
``(4) Permanent committee.--Section 14 of the Federal
Advisory Committee Act (5 U.S.C. App.) shall not apply to the
Advisory Committee.''
(2) Following recommendations.--Section 1834(m)(4)(F) of such
Act (42 U.S.C. 1395m(m)(4)(F)) is amended by adding at the end
the following new clause:
``(iii) Recommendations of the telehealth
advisory committee.--In making determinations
under clauses (i) and (ii), the Secretary shall
take into account the recommendations of the
Telehealth Advisory Committee (established
under section 1868(c)) when adding or deleting
services (and HCPCS codes) and in establishing
policies of the Centers for Medicare & Medicaid
Services regarding the delivery of telehealth
services. If the Secretary does not implement
such a recommendation, the Secretary shall
publish in the Federal Register a statement
regarding the reason such recommendation was
not implemented.''
(3) Waiver of administrative limitation.--The Secretary of
Health and Human Services shall establish the Telehealth
Advisory Committee under the amendment made by paragraph (1)
notwithstanding any limitation that may apply to the number of
advisory committees that may be established (within the
Department of Health and Human Services or otherwise).
SEC. 1192. EXTENSION OF OUTPATIENT HOLD HARMLESS PROVISION.
Section 1833(t)(7)(D)(i) of the Social Security Act (42 U.S.C.
1395l(t)(7)(D)(i)) is amended--
(1) in subclause (II)--
(A) in the first sentence, by striking ```2010'' and
inserting ``2012''; and
(B) in the second sentence, by striking ``or 2009''
and inserting ``, 2009, 2010, or 2011''; and
(2) in subclause (III), by striking ``January 1, 2010'' and
inserting ``January 1, 2012''.
SEC. 1193. EXTENSION OF SECTION 508 HOSPITAL RECLASSIFICATIONS.
Subsection (a) of section 106 of division B of the Tax Relief and
Health Care Act of 2006 (42 U.S.C. 1395 note), as amended by section
117 of the Medicare, Medicaid, and SCHIP Extension Act of 2007 (Public
Law 110-173) and section 124 of the Medicare Improvements for Patients
and Providers Act of 2008 (Public Law 110-275), is amended by striking
``September 30, 2009'' and inserting ``September 30, 2011''.
SEC. 1194. EXTENSION OF GEOGRAPHIC FLOOR FOR WORK.
Section 1848(e)(1)(E) of the Social Security Act (42 U.S.C. 1395w-
4(e)(1)(E)) is amended by striking ``before January 1, 2010'' and
inserting ``before January 1, 2012''.
SEC. 1195. EXTENSION OF PAYMENT FOR TECHNICAL COMPONENT OF CERTAIN
PHYSICIAN PATHOLOGY SERVICES.
Section 542(c) of the Medicare, Medicaid, and SCHIP Benefits
Improvement and Protection Act of 2000 (as enacted into law by section
1(a)(6) of Public Law 106-554), as amended by section 732 of the
Medicare Prescription Drug, Improvement, and Modernization Act of 2003
(42 U.S.C. 1395w-4 note), section 104 of division B of the Tax Relief
and Health Care Act of 2006 (42 U.S.C. 1395w-4 note), section 104 of
the Medicare, Medicaid, and SCHIP Extension Act of 2007 (Public Law
110-173), and section 136 of the Medicare Improvements for Patients and
Providers Act of 1008 (Public Law 110-275), is amended by striking
``and 2009'' and inserting ``2009, 2010, and 2011''.
SEC. 1196. EXTENSION OF AMBULANCE ADD-ONS.
(a) In General.--Section 1834(l)(13) of the Social Security Act (42
U.S.C. 1395m(l)(13)) is amended--
(1) in subparagraph (A)--
(A) in the matter preceding clause (i), by striking
``before January 1, 2010'' and inserting ``before
January 1, 2012''; and
(B) in each of clauses (i) and (ii), by striking
``before January 1, 2010'' and inserting ``before
January 1, 2012''.
(b) Air Ambulance Improvements.--Section 146(b)(1) of the Medicare
Improvements for Patients and Providers Act of 2008 (Public Law 110-
275) is amended by striking ``ending on December 31, 2009'' and
inserting ``ending on December 31, 2011''.
SEC. 1197. ENSURING PROPORTIONAL REPRESENTATION OF INTERESTS OF RURAL
AREAS ON MEDPAC.
(a) In General.--Section 1805(c)(2) of the Social Security Act (42
U.S.C. 1395b-6(c)(2)) is amended--
(1) in subparagraph (A), by inserting ``consistent with
subparagraph (E)'' after ``rural representatives''; and
(2) by adding at the end the following new subparagraph:
``(E) Proportional representation of interests of
rural areas.--In order to provide a balance between
urban and rural representatives under subparagraph (A),
the proportion of members of the Commission who
represent the interests of health care providers and
Medicare beneficiaries located in rural areas shall be
no less than the proportion of the total number of
Medicare beneficiaries who reside in rural areas.''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to appointments to the Medicare Payment Advisory Commission made
after the date of the enactment of this Act.
TITLE II--MEDICARE BENEFICIARY IMPROVEMENTS
Subtitle A--Improving and Simplifying Financial Assistance for Low
Income Medicare Beneficiaries
SEC. 1201. IMPROVING ASSETS TESTS FOR MEDICARE SAVINGS PROGRAM AND LOW-
INCOME SUBSIDY PROGRAM.
(a) Application of Highest Level Permitted Under LIS to All Subsidy
Eligible Individuals.--
(1) In general.--Section 1860D-14(a)(1) of the Social
Security Act (42 U.S.C. 1395w-114(a)(1)) is amended in the
matter before subparagraph (A), by inserting ``(or, beginning
with 2012, paragraph (3)(E))'' after ``paragraph (3)(D)''.
(2) Annual increase in lis resource test.--Section 1860D-
14(a)(3)(E)(i) of such Act (42 U.S.C. 1395w-114(a)(3)(E)(i)) is
amended--
(A) by striking ``and'' at the end of subclause (I);
(B) in subclause (II), by inserting ``(before 2012)''
after ``subsequent year'';
(C) by striking the period at the end of subclause
(II) and inserting a semicolon;
(D) by inserting after subclause (II) the following
new subclauses:
``(III) for 2012, $17,000 (or $34,000
in the case of the combined value of
the individual's assets or resources
and the assets or resources of the
individual's spouse); and
``(IV) for a subsequent year, the
dollar amounts specified in this
subclause (or subclause (III)) for the
previous year increased by the annual
percentage increase in the consumer
price index (all items; U.S. city
average) as of September of such
previous year.''; and
(E) in the last sentence, by inserting ``or (IV)''
after ``subclause (II)''.
(3) Application of lis test under medicare savings program.--
Section 1905(p)(1)(C) of such Act (42 U.S.C. 1396d(p)(1)(C)) is
amended--
(A) by striking ``effective beginning with January 1,
2010'' and inserting ``effective for the period
beginning with January 1, 2010, and ending with
December 31, 2011''; and
(B) by inserting before the period at the end the
following: ``or, effective beginning with January 1,
2012, whose resources (as so determined) do not exceed
the maximum resource level applied for the year under
subparagraph (E) of section 1860D-14(a)(3) (determined
without regard to the life insurance policy exclusion
provided under subparagraph (G) of such section)
applicable to an individual or to the individual and
the individual's spouse (as the case may be)''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to eligibility determinations for income-related subsidies and
medicare cost-sharing furnished for periods beginning on or after
January 1, 2012.
SEC. 1202. ELIMINATION OF PART D COST-SHARING FOR CERTAIN
NONINSTITUTIONALIZED FULL-BENEFIT DUAL ELIGIBLE
INDIVIDUALS.
(a) In General.--Section 1860D-14(a)(1)(D)(i) of the Social Security
Act (42 U.S.C. 1395w-114(a)(1)(D)(i)) is amended--
(1) by striking ``Institutionalized individuals.--In'' and
inserting ``Elimination of cost-sharing for certain full-
benefit dual eligible individuals.--
``(I) Institutionalized
individuals.--In''; and
(2) by adding at the end the following new subclause:
``(II) Certain other individuals.--In
the case of an individual who is a
full-benefit dual eligible individual
and with respect to whom there has been
a determination that but for the
provision of home and community based
care (whether under section 1915, 1932,
or under a waiver under section 1115)
the individual would require the level
of care provided in a hospital or a
nursing facility or intermediate care
facility for the mentally retarded the
cost of which could be reimbursed under
the State plan under title XIX, the
elimination of any beneficiary
coinsurance described in section 1860D-
2(b)(2) (for all amounts through the
total amount of expenditures at which
benefits are available under section
1860D-2(b)(4)).''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to drugs dispensed on or after January 1, 2011.
SEC. 1203. ELIMINATING BARRIERS TO ENROLLMENT.
(a) Administrative Verification of Income and Resources Under the
Low-income Subsidy Program.--
(1) In general.--Clause (iii) of section 1860D-14(a)(3)(E) of
the Social Security Act (42 U.S.C. 1395w-114(a)(3)(E)) is
amended to read as follows:
``(iii) Certification of income and
resources.--For purposes of applying this
section--
``(I) an individual shall be
permitted to apply on the basis of
self-certification of income and
resources; and
``(II) matters attested to in the
application shall be subject to
appropriate methods of verification
without the need of the individual to
provide additional documentation,
except in extraordinary situations as
determined by the Commissioner.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply beginning January 1, 2010.
(b) Disclosures to Facilitate Identification of Individuals Likely to
Be Ineligible for the Low-income Assistance Under the Medicare
Prescription Drug Program to Assist Social Security Administration's
Outreach to Eligible Individuals.--For provision authorizing disclosure
of return information to facilitate identification of individuals
likely to be ineligible for low-income subsidies under Medicare
prescription drug program, see section 1801.
SEC. 1204. ENHANCED OVERSIGHT RELATING TO REIMBURSEMENTS FOR
RETROACTIVE LOW INCOME SUBSIDY ENROLLMENT.
(a) In General.--In the case of a retroactive LIS enrollment
beneficiary who is enrolled under a prescription drug plan under part D
of title XVIII of the Social Security Act (or an MA-PD plan under part
C of such title), the beneficiary (or any eligible third party) is
entitled to reimbursement by the plan for covered drug costs incurred
by the beneficiary during the retroactive coverage period of the
beneficiary in accordance with subsection (b) and in the case of such a
beneficiary described in subsection (c)(4)(A)(i), such reimbursement
shall be made automatically by the plan upon receipt of appropriate
notice the beneficiary is eligible for assistance described in such
subsection (c)(4)(A)(i) without further information required to be
filed with the plan by the beneficiary.
(b) Administrative Requirements Relating to Reimbursements.--
(1) Line-item description.--Each reimbursement made by a
prescription drug plan or MA-PD plan under subsection (a) shall
include a line-item description of the items for which the
reimbursement is made.
(2) Timing of reimbursements.--A prescription drug plan or
MA-PD plan must make a reimbursement under subsection (a) to a
retroactive LIS enrollment beneficiary, with respect to a
claim, not later than 45 days after--
(A) in the case of a beneficiary described in
subsection (c)(4)(A)(i), the date on which the plan
receives notice from the Secretary that the beneficiary
is eligible for assistance described in such
subsection; or
(B) in the case of a beneficiary described in
subsection (c)(4)(A)(ii), the date on which the
beneficiary files the claim with the plan.
(3) Reporting requirement.--For each month beginning with
January 2011, each prescription drug plan and each MA-PD plan
shall report to the Secretary the following:
(A) The number of claims the plan has readjudicated
during the month due to a beneficiary becoming
retroactively eligible for subsidies available under
section 1860D-14 of the Social Security Act.
(B) The total value of the readjudicated claim amount
for the month.
(C) The Medicare Health Insurance Claims Number of
beneficiaries for whom claims were readjudicated.
(D) For the claims described in subparagraphs (A) and
(B), an attestation to the Administrator of the Centers
for Medicare & Medicaid Services of the total amount of
reimbursement the plan has provided to beneficiaries
for premiums and cost-sharing that the beneficiary
overpaid for which the plan received payment from the
Centers for Medicare & Medicaid Services.
(c) Definitions.--For purposes of this section:
(1) Covered drug costs.--The term ``covered drug costs''
means, with respect to a retroactive LIS enrollment beneficiary
enrolled under a prescription drug plan under part D of title
XVIII of the Social Security Act (or an MA-PD plan under part C
of such title), the amount by which--
(A) the costs incurred by such beneficiary during the
retroactive coverage period of the beneficiary for
covered part D drugs, premiums, and cost-sharing under
such title; exceeds
(B) such costs that would have been incurred by such
beneficiary during such period if the beneficiary had
been both enrolled in the plan and recognized by such
plan as qualified during such period for the low income
subsidy under section 1860D-14 of the Social Security
Act to which the individual is entitled.
(2) Eligible third party.--The term ``eligible third party''
means, with respect to a retroactive LIS enrollment
beneficiary, an organization or other third party that is owed
payment on behalf of such beneficiary for covered drug costs
incurred by such beneficiary during the retroactive coverage
period of such beneficiary.
(3) Retroactive coverage period.--The term ``retroactive
coverage period'' means--
(A) with respect to a retroactive LIS enrollment
beneficiary described in paragraph (4)(A)(i), the
period--
(i) beginning on the effective date of the
assistance described in such paragraph for
which the individual is eligible; and
(ii) ending on the date the plan effectuates
the status of such individual as so eligible;
and
(B) with respect to a retroactive LIS enrollment
beneficiary described in paragraph (4)(A)(ii), the
period--
(i) beginning on the date the individual is
both entitled to benefits under part A, or
enrolled under part B, of title XVIII of the
Social Security Act and eligible for medical
assistance under a State plan under title XIX
of such Act; and
(ii) ending on the date the plan effectuates
the status of such individual as a full-benefit
dual eligible individual (as defined in section
1935(c)(6) of such Act).
(4) Retroactive lis enrollment beneficiary.--
(A) In general.--The term ``retroactive LIS
enrollment beneficiary'' means an individual who--
(i) is enrolled in a prescription drug plan
under part D of title XVIII of the Social
Security Act (or an MA-PD plan under part C of
such title) and subsequently becomes eligible
as a full-benefit dual eligible individual (as
defined in section 1935(c)(6) of such Act), an
individual receiving a low-income subsidy under
section 1860D-14 of such Act, an individual
receiving assistance under the Medicare Savings
Program implemented under clauses (i), (iii),
and (iv) of section 1902(a)(10)(E) of such Act,
or an individual receiving assistance under the
supplemental security income program under
section 1611 of such Act; or
(ii) subject to subparagraph (B)(i), is a
full-benefit dual eligible individual (as
defined in section 1935(c)(6) of such Act) who
is automatically enrolled in such a plan under
section 1860D-1(b)(1)(C) of such Act.
(B) Exception for beneficiaries enrolled in rfp
plan.--
(i) In general.--In no case shall an
individual described in subparagraph (A)(ii)
include an individual who is enrolled, pursuant
to a RFP contract described in clause (ii), in
a prescription drug plan offered by the sponsor
of such plan awarded such contract.
(ii) RFP contract described.--The RFP
contract described in this section is a
contract entered into between the Secretary and
a sponsor of a prescription drug plan pursuant
to the Centers for Medicare & Medicaid
Services' request for proposals issued on
February 17, 2009, relating to Medicare part D
retroactive coverage for certain low income
beneficiaries, or a similar subsequent request
for proposals.
SEC. 1205. INTELLIGENT ASSIGNMENT IN ENROLLMENT.
(a) In General.--Section 1860D-1(b)(1)(C) of the Social Security Act
(42 U.S.C. 1395w-101(b)(1)(C)) is amended by adding after ``PDP
region'' the following: ``or through use of an intelligent assignment
process that is designed to maximize the access of such individual to
necessary prescription drugs while minimizing costs to such individual
and to the program under this part to the greatest extent possible. In
the case the Secretary enrolls such individuals through use of an
intelligent assignment process, such process shall take into account
the extent to which prescription drugs necessary for the individual are
covered in the case of a PDP sponsor of a prescription drug plan that
uses a formulary, the use of prior authorization or other restrictions
on access to coverage of such prescription drugs by such a sponsor, and
the overall quality of a prescription drug plan as measured by quality
ratings established by the Secretary''
(b) Effective Date.--The amendment made by subsection (a) shall take
effect for contract years beginning with 2012.
SEC. 1206. SPECIAL ENROLLMENT PERIOD AND AUTOMATIC ENROLLMENT PROCESS
FOR CERTAIN SUBSIDY ELIGIBLE INDIVIDUALS.
(a) Special Enrollment Period.--Section 1860D-1(b)(3)(D) of the
Social Security Act (42 U.S.C. 1395w-101(b)(3)(D)) is amended to read
as follows:
``(D) Subsidy eligible individuals.--In the case of
an individual (as determined by the Secretary) who is
determined under subparagraph (B) of section 1860D-
14(a)(3) to be a subsidy eligible individual.''.
(b) Automatic Enrollment.--Section 1860D-1(b)(1) of the Social
Security Act (42 U.S.C. 1395w-101(b)(1)) is amended by adding at the
end the following new subparagraph:
``(D) Special rule for subsidy eligible
individuals.--The process established under
subparagraph (A) shall include, in the case of an
individual described in paragraph (3)(D) who fails to
enroll in a prescription drug plan or an MA-PD plan
during the special enrollment established under such
section applicable to such individual, the application
of the assignment process described in subparagraph (C)
to such individual in the same manner as such
assignment process applies to a part D eligible
individual described in such subparagraph (C). Nothing
in the previous sentence shall prevent an individual
described in such sentence from declining enrollment in
a plan determined appropriate by the Secretary (or in
the program under this part) or from changing such
enrollment.''.
(c) Effective Date.--The amendments made by this section shall apply
to subsidy determinations made for months beginning with January 2011.
SEC. 1207. APPLICATION OF MA PREMIUMS PRIOR TO REBATE IN CALCULATION OF
LOW INCOME SUBSIDY BENCHMARK.
(a) In General.--Section 1860D-14(b)(2)(B)(iii) of the Social
Security Act (42 U.S.C. 1395w-114(b)(2)(B)(iii)) is amended by
inserting before the period the following: ``before the application of
the monthly rebate computed under section 1854(b)(1)(C)(i) for that
plan and year involved''.
(b) Effective Date.--The amendment made by subsection (a) shall apply
to subsidy determinations made for months beginning with January 2011.
Subtitle B--Reducing Health Disparities
SEC. 1221. ENSURING EFFECTIVE COMMUNICATION IN MEDICARE.
(a) Ensuring Effective Communication by the Centers for Medicare &
Medicaid Services.--
(1) Study on medicare payments for language services.--The
Secretary of Health and Human Services shall conduct a study
that examines the extent to which Medicare service providers
utilize, offer, or make available language services for
beneficiaries who are limited English proficient and ways that
Medicare should develop payment systems for language services.
(2) Analyses.--The study shall include an analysis of each of
the following:
(A) How to develop and structure appropriate payment
systems for language services for all Medicare service
providers.
(B) The feasibility of adopting a payment methodology
for on-site interpreters, including interpreters who
work as independent contractors and interpreters who
work for agencies that provide on-site interpretation,
pursuant to which such interpreters could directly bill
Medicare for services provided in support of physician
office services for an LEP Medicare patient.
(C) The feasibility of Medicare contracting directly
with agencies that provide off-site interpretation
including telephonic and video interpretation pursuant
to which such contractors could directly bill Medicare
for the services provided in support of physician
office services for an LEP Medicare patient.
(D) The feasibility of modifying the existing
Medicare resource-based relative value scale (RBRVS) by
using adjustments (such as multipliers or add-ons) when
a patient is LEP.
(E) How each of options described in a previous
paragraph would be funded and how such funding would
affect physician payments, a physician's practice, and
beneficiary cost-sharing.
(F) The extent to which providers under parts A and B
of title XVIII of the Social Security Act, MA
organizations offering Medicare Advantage plans under
part C of such title and PDP sponsors of a prescription
drug plan under part D of such title utilize, offer, or
make available language services for beneficiaries with
limited English proficiency.
(G) The nature and type of language services provided
by States under title XIX of the Social Security Act
and the extent to which such services could be utilized
by beneficiaries and providers under title XVIII of
such Act.
(3) Variation in payment system described.--The payment
systems described in paragraph (2)(A) may allow variations
based upon types of service providers, available delivery
methods, and costs for providing language services including
such factors as--
(A) the type of language services provided (such as
provision of health care or health care related
services directly in a non-English language by a
bilingual provider or use of an interpreter);
(B) type of interpretation services provided (such as
in-person, telephonic, video interpretation);
(C) the methods and costs of providing language
services (including the costs of providing language
services with internal staff or through contract with
external independent contractors or agencies, or both);
(D) providing services for languages not frequently
encountered in the United States; and
(E) providing services in rural areas.
(4) Report.--The Secretary shall submit a report on the study
conducted under subsection (a) to appropriate committees of
Congress not later than 12 months after the date of the
enactment of this Act.
(5) Exemption from paperwork reduction act.--Chapter 35 of
title 44, United States Code (commonly known as the ``Paperwork
Reduction Act'' ), shall not apply for purposes of carrying out
this subsection.
(6) Authorization of appropriations.--There is authorized to
be appropriated to carry out this subsection such sums as are
necessary.
(b) Health Plans.--Section 1857(g)(1) of the Social Security Act (42
U.S.C. 1395w-27(g)(1)) is amended--
(1) by striking ``or'' at the end of subparagraph (F);
(2) by adding ``or'' at the end of subparagraph (G); and
(3) by inserting after subparagraph (G) the following new
subparagraph:
``(H) fails substantially to provide language
services to limited English proficient beneficiaries
enrolled in the plan that are required under law;''.
SEC. 1222. DEMONSTRATION TO PROMOTE ACCESS FOR MEDICARE BENEFICIARIES
WITH LIMITED-ENGLISH PROFICIENCY BY PROVIDING
REIMBURSEMENT FOR CULTURALLY AND LINGUISTICALLY
APPROPRIATE SERVICES.
(a) In General.--Not later than 6 months after the date of the
completion of the study described in section 1221(a), the Secretary,
acting through the Centers for Medicare & Medicaid Services and the
Center for Medicare and Medicaid Payment Innovation established under
section 1115A of the Social Security Act (as added by section 1910) and
consistent with the applicable provisions of such section, shall carry
out a demonstration program under which the Secretary shall award not
fewer than 24 3-year grants to eligible Medicare service providers (as
described in subsection (b)(1)) to improve effective communication
between such providers and Medicare beneficiaries who are living in
communities where racial and ethnic minorities, including populations
that face language barriers, are underserved with respect to such
services. In designing and carrying out the demonstration the Secretary
shall take into consideration the results of the study conducted under
section 1221(a) and adjust, as appropriate, the distribution of grants
so as to better target Medicare beneficiaries who are in the greatest
need of language services. The Secretary shall not authorize a grant
larger than $500,000 over three years for any grantee.
(b) Eligibility; Priority.--
(1) Eligibility.--To be eligible to receive a grant under
subsection (a) an entity shall--
(A) be--
(i) a provider of services under part A of
title XVIII of the Social Security Act;
(ii) a service provider under part B of such
title;
(iii) a part C organization offering a
Medicare part C plan under part C of such
title; or
(iv) a PDP sponsor of a prescription drug
plan under part D of such title; and
(B) prepare and submit to the Secretary an
application, at such time, in such manner, and
accompanied by such additional information as the
Secretary may require.
(2) Priority.--
(A) Distribution.--To the extent feasible, in
awarding grants under this section, the Secretary shall
award--
(i) at least 6 grants to providers of
services described in paragraph (1)(A)(i);
(ii) at least 6 grants to service providers
described in paragraph (1)(A)(ii);
(iii) at least 6 grants to organizations
described in paragraph (1)(A)(iii); and
(iv) at least 6 grants to sponsors described
in paragraph (1)(A)(iv).
(B) For community organizations.--The Secretary shall
give priority to applicants that have developed
partnerships with community organizations or with
agencies with experience in language access.
(C) Variation in grantees.--The Secretary shall also
ensure that the grantees under this section represent,
among other factors, variations in--
(i) different types of language services
provided and of service providers and
organizations under parts A through D of title
XVIII of the Social Security Act;
(ii) languages needed and their frequency of
use;
(iii) urban and rural settings;
(iv) at least two geographic regions, as
defined by the Secretary; and
(v) at least two large metropolitan
statistical areas with diverse populations.
(c) Use of Funds.--
(1) In general.--A grantee shall use grant funds received
under this section to pay for the provision of competent
language services to Medicare beneficiaries who are limited-
English proficient. Competent interpreter services may be
provided through on-site interpretation, telephonic
interpretation, or video interpretation or direct provision of
health care or health care related services by a bilingual
health care provider. A grantee may use bilingual providers,
staff, or contract interpreters. A grantee may use grant funds
to pay for competent translation services. A grantee may use up
to 10 percent of the grant funds to pay for administrative
costs associated with the provision of competent language
services and for reporting required under subsection (e).
(2) Organizations.--Grantees that are part C organizations or
PDP sponsors must ensure that their network providers receive
at least 50 percent of the grant funds to pay for the provision
of competent language services to Medicare beneficiaries who
are limited-English proficient, including physicians and
pharmacies.
(3) Determination of payments for language services.--
Payments to grantees shall be calculated based on the estimated
numbers of limited-English proficient Medicare beneficiaries in
a grantee's service area utilizing--
(A) data on the numbers of limited-English proficient
individuals who speak English less than ``very well''
from the most recently available data from the Bureau
of the Census or other State-based study the Secretary
determines likely to yield accurate data regarding the
number of such individuals served by the grantee; or
(B) the grantee's own data if the grantee routinely
collects data on Medicare beneficiaries' primary
language in a manner determined by the Secretary to
yield accurate data and such data shows greater numbers
of limited-English proficient individuals than the data
listed in subparagraph (A).
(4) Limitations.--
(A) Reporting.--Payments shall only be provided under
this section to grantees that report their costs of
providing language services as required under
subsection (e) and may be modified annually at the
discretion of the Secretary. If a grantee fails to
provide the reports under such section for the first
year of a grant, the Secretary may terminate the grant
and solicit applications from new grantees to
participate in the subsequent two years of the
demonstration program.
(B) Type of services.--
(i) In general.--Subject to clause (ii),
payments shall be provided under this section
only to grantees that utilize competent
bilingual staff or competent interpreter or
translation services which--
(I) if the grantee operates in a
State that has statewide health care
interpreter standards, meet the State
standards currently in effect; or
(II) if the grantee operates in a
State that does not have statewide
health care interpreter standards,
utilizes competent interpreters who
follow the National Council on
Interpreting in Health Care's Code of
Ethics and Standards of Practice.
(ii) Exemptions.--The requirements of clause
(i) shall not apply--
(I) in the case of a Medicare
beneficiary who is limited-English
proficient (who has been informed in
the beneficiary's primary language of
the availability of free interpreter
and translation services) and who
requests the use of family, friends, or
other persons untrained in
interpretation or translation and the
grantee documents the request in the
beneficiary's record; and
(II) in the case of a medical
emergency where the delay directly
associated with obtaining a competent
interpreter or translation services
would jeopardize the health of the
patient.
Nothing in clause (ii)(II) shall be construed
to exempt emergency rooms or similar entities
that regularly provide health care services in
medical emergencies from having in place
systems to provide competent interpreter and
translation services without undue delay.
(d) Assurances.--Grantees under this section shall--
(1) ensure that appropriate clinical and support staff
receive ongoing education and training in linguistically
appropriate service delivery;
(2) ensure the linguistic competence of bilingual providers;
(3) offer and provide appropriate language services at no
additional charge to each patient with limited-English
proficiency at all points of contact, in a timely manner during
all hours of operation;
(4) notify Medicare beneficiaries of their right to receive
language services in their primary language;
(5) post signage in the languages of the commonly encountered
group or groups present in the service area of the
organization; and
(6) ensure that--
(A) primary language data are collected for
recipients of language services; and
(B) consistent with the privacy protections provided
under the regulations promulgated pursuant to section
264(c) of the Health Insurance Portability and
Accountability Act of 1996 (42 U.S.C. 1320d-2 note), if
the recipient of language services is a minor or is
incapacitated, the primary language of the parent or
legal guardian is collected and utilized.
(e) Reporting Requirements.--Grantees under this section shall
provide the Secretary with reports at the conclusion of the each year
of a grant under this section. Each report shall include at least the
following information:
(1) The number of Medicare beneficiaries to whom language
services are provided.
(2) The languages of those Medicare beneficiaries.
(3) The types of language services provided (such as
provision of services directly in non-English language by a
bilingual health care provider or use of an interpreter).
(4) Type of interpretation (such as in-person, telephonic, or
video interpretation).
(5) The methods of providing language services (such as staff
or contract with external independent contractors or agencies).
(6) The length of time for each interpretation encounter.
(7) The costs of providing language services (which may be
actual or estimated, as determined by the Secretary).
(f) No Cost Sharing.--Limited-English proficient Medicare
beneficiaries shall not have to pay cost-sharing or co-pays for
language services provided through this demonstration program.
(g) Evaluation and Report.--The Secretary shall conduct an evaluation
of the demonstration program under this section and shall submit to the
appropriate committees of Congress a report not later than 1 year after
the completion of the program. The report shall include the following:
(1) An analysis of the patient outcomes and costs of
furnishing care to the limited-English proficient Medicare
beneficiaries participating in the project as compared to such
outcomes and costs for limited-English proficient Medicare
beneficiaries not participating.
(2) The effect of delivering culturally and linguistically
appropriate services on beneficiary access to care, utilization
of services, efficiency and cost-effectiveness of health care
delivery, patient satisfaction, and select health outcomes.
(3) Recommendations, if any, regarding the extension of such
project to the entire Medicare program.
(h) General Provisions.--Nothing in this section shall be construed
to limit otherwise existing obligations of recipients of Federal
financial assistance under title VI of the Civil Rights Act of 1964 (42
U.S.C. 2000(d) et seq.) or any other statute.
(i) Authorization of Appropriations.--There are authorized to be
appropriated to carry out this section $16,000,000 for each fiscal year
of the demonstration program.
SEC. 1223. IOM REPORT ON IMPACT OF LANGUAGE ACCESS SERVICES.
(a) In General.--The Secretary of Health and Human Services shall
enter into an arrangement with the Institute of Medicine under which
the Institute will prepare and publish, not later than 3 years after
the date of the enactment of this Act, a report on the impact of
language access services on the health and health care of limited-
English proficient populations.
(b) Contents.--Such report shall include--
(1) recommendations on the development and implementation of
policies and practices by health care organizations and
providers for limited-English proficient patient populations;
(2) a description of the effect of providing language access
services on quality of health care and access to care and
reduced medical error; and
(3) a description of the costs associated with or savings
related to provision of language access services.
SEC. 1224. DEFINITIONS.
In this subtitle:
(1) Bilingual.--The term ``bilingual'' with respect to an
individual means a person who has sufficient degree of
proficiency in two languages and can ensure effective
communication can occur in both languages.
(2) Competent interpreter services.--The term ``competent
interpreter services'' means a trans-language rendition of a
spoken message in which the interpreter comprehends the source
language and can speak comprehensively in the target language
to convey the meaning intended in the source language. The
interpreter knows health and health-related terminology and
provides accurate interpretations by choosing equivalent
expressions that convey the best matching and meaning to the
source language and captures, to the greatest possible extent,
all nuances intended in the source message.
(3) Competent translation services.--The term ``competent
translation services'' means a trans-language rendition of a
written document in which the translator comprehends the source
language and can write comprehensively in the target language
to convey the meaning intended in the source language. The
translator knows health and health-related terminology and
provides accurate translations by choosing equivalent
expressions that convey the best matching and meaning to the
source language and captures, to the greatest possible extent,
all nuances intended in the source document.
(4) Effective communication.--The term ``effective
communication'' means an exchange of information between the
provider of health care or health care-related services and the
limited-English proficient recipient of such services that
enables limited-English proficient individuals to access,
understand, and benefit from health care or health care-related
services.
(5) Interpreting/interpretation.--The terms ``interpreting''
and ``interpretation'' mean the transmission of a spoken
message from one language into another, faithfully, accurately,
and objectively.
(6) Health care services.--The term ``health care services''
means services that address physical as well as mental health
conditions in all care settings.
(7) Health care-related services.--The term ``health care-
related services'' means human or social services programs or
activities that provide access, referrals or links to health
care.
(8) Language access.--The term ``language access'' means the
provision of language services to an LEP individual designed to
enhance that individual's access to, understanding of or
benefit from health care or health care-related services.
(9) Language services.--The term ``language services'' means
provision of health care services directly in a non-English
language, interpretation, translation, and non-English signage.
(10) Limited-english proficient.--The term ``limited-English
proficient'' or ``LEP'' with respect to an individual means an
individual who speaks a primary language other than English and
who cannot speak, read, write or understand the English
language at a level that permits the individual to effectively
communicate with clinical or nonclinical staff at an entity
providing health care or health care related services.
(11) Medicare beneficiary.--The term ``Medicare beneficiary''
means an individual entitled to benefits under part A of title
XVIII of the Social Security Act or enrolled under part B of
such title.
(12) Medicare program.--The term ``Medicare program'' means
the programs under parts A through D of title XVIII of the
Social Security Act.
(13) Service provider.--The term ``service provider''
includes all suppliers, providers of services, or entities
under contract to provide coverage, items or services under any
part of title XVIII of the Social Security Act.
Subtitle C--Miscellaneous Improvements
SEC. 1231. EXTENSION OF THERAPY CAPS EXCEPTIONS PROCESS.
Section 1833(g)(5) of the Social Security Act (42 U.S.C.
1395l(g)(5)), as amended by section 141 of the Medicare Improvements
for Patients and Providers Act of 2008 (Public Law 110-275), is amended
by striking ``December 31, 2009'' and inserting ``December 31, 2011''.
SEC. 1232. EXTENDED MONTHS OF COVERAGE OF IMMUNOSUPPRESSIVE DRUGS FOR
KIDNEY TRANSPLANT PATIENTS AND OTHER RENAL DIALYSIS
PROVISIONS.
(a) Provision of Appropriate Coverage of Immunosuppressive Drugs
Under the Medicare Program for Kidney Transplant Recipients.--
(1) Continued entitlement to immunosuppressive drugs.--
(A) Kidney transplant recipients.--Section 226A(b)(2)
of the Social Security Act (42 U.S.C. 426-1(b)(2)) is
amended by inserting ``(except for coverage of
immunosuppressive drugs under section 1861(s)(2)(J))''
before ``, with the thirty-sixth month''.
(B) Application.--Section 1836 of such Act (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 on or after
January 1, 2012, except for the coverage of immunosuppressive
drugs by reason of section 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
providing for payment of the portion of the premium
under section 1839 which is not covered under the
Medicare savings program (as defined in section
1144(c)(7)) 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 individuals that are entitled to
coverage of immunosuppressive drugs by reason of
section 226A(b)(2); and
``(B) distinguishing such individuals from
individuals that are enrolled under this part for the
complete package of benefits under this part.''.
(C) Technical amendment to correct duplicate
subsection designation.--Subsection (c) of section 226A
of such Act (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) of such Act (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 the enactment of the
America's Affordable Health Choices Act of 2009, this
subparagraph shall be applied without regard to any time
limitation.''.
(b) Medicare Coverage for ESRD Patients.--Section 1881 of such Act is
further amended--
(1) in subsection (b)(14)(B)(iii), by inserting ``, including
oral drugs that are not the oral equivalent of an intravenous
drug (such as oral phosphate binders and calcimimetics),''
after ``other drugs and biologicals'';
(2) in subsection (b)(14)(E)(ii)--
(A) in the first sentence--
(i) by striking ``a one-time election to be
excluded from the phase-in'' and inserting ``an
election, with respect to 2011, 2012, or 2013,
to be excluded from the phase-in (or the
remainder of the phase-in)''; and
(ii) by adding before the period at the end
the following: ``for such year and for each
subsequent year during the phase-in described
in clause (i)''; and
(B) in the second sentence--
(i) by striking ``January 1, 2011'' and
inserting ``the first date of such year''; and
(ii) by inserting ``and at a time'' after
``form and manner''; and
(3) in subsection (h)(4)(E), by striking ``lesser'' and
inserting ``greater''.
SEC. 1233. ADVANCE CARE PLANNING CONSULTATION.
(a) Medicare.--
(1) In general.--Section 1861 of the Social Security Act (42
U.S.C. 1395x) is amended--
(A) in subsection (s)(2)--
(i) by striking ``and'' at the end of
subparagraph (DD);
(ii) by adding ``and'' at the end of
subparagraph (EE); and
(iii) by adding at the end the following new
subparagraph:
``(FF) advance care planning consultation (as defined in
subsection (hhh)(1));''; and
(B) by adding at the end the following new
subsection:
``Advance Care Planning Consultation
``(hhh)(1) Subject to paragraphs (3) and (4), the term `advance care
planning consultation' means a consultation between the individual and
a practitioner described in paragraph (2) regarding advance care
planning, if, subject to paragraph (3), the individual involved has not
had such a consultation within the last 5 years. Such consultation
shall include the following:
``(A) An explanation by the practitioner of advance care
planning, including key questions and considerations, important
steps, and suggested people to talk to.
``(B) An explanation by the practitioner of advance
directives, including living wills and durable powers of
attorney, and their uses.
``(C) An explanation by the practitioner of the role and
responsibilities of a health care proxy.
``(D) The provision by the practitioner of a list of national
and State-specific resources to assist consumers and their
families with advance care planning, including the national
toll-free hotline, the advance care planning clearinghouses,
and State legal service organizations (including those funded
through the Older Americans Act of 1965).
``(E) An explanation by the practitioner of the continuum of
end-of-life services and supports available, including
palliative care and hospice, and benefits for such services and
supports that are available under this title.
``(F)(i) Subject to clause (ii), an explanation of orders
regarding life sustaining treatment or similar orders, which
shall include--
``(I) the reasons why the development of such an
order is beneficial to the individual and the
individual's family and the reasons why such an order
should be updated periodically as the health of the
individual changes;
``(II) the information needed for an individual or
legal surrogate to make informed decisions regarding
the completion of such an order; and
``(III) the identification of resources that an
individual may use to determine the requirements of the
State in which such individual resides so that the
treatment wishes of that individual will be carried out
if the individual is unable to communicate those
wishes, including requirements regarding the
designation of a surrogate decisionmaker (also known as
a health care proxy).
``(ii) The Secretary shall limit the requirement for
explanations under clause (i) to consultations furnished in a
State--
``(I) in which all legal barriers have been addressed
for enabling orders for life sustaining treatment to
constitute a set of medical orders respected across all
care settings; and
``(II) that has in effect a program for orders for
life sustaining treatment described in clause (iii).
``(iii) A program for orders for life sustaining treatment
for a States described in this clause is a program that--
``(I) ensures such orders are standardized and
uniquely identifiable throughout the State;
``(II) distributes or makes accessible such orders to
physicians and other health professionals that (acting
within the scope of the professional's authority under
State law) may sign orders for life sustaining
treatment;
``(III) provides training for health care
professionals across the continuum of care about the
goals and use of orders for life sustaining treatment;
and
``(IV) is guided by a coalition of stakeholders
includes representatives from emergency medical
services, emergency department physicians or nurses,
state long-term care association, state medical
association, state surveyors, agency responsible for
senior services, state department of health, state
hospital association, home health association, state
bar association, and state hospice association.
``(2) A practitioner described in this paragraph is--
``(A) a physician (as defined in subsection (r)(1)); and
``(B) a nurse practitioner or physician assistant who has the
authority under State law to sign orders for life sustaining
treatments.
``(3)(A) An initial preventive physical examination under subsection
(WW), including any related discussion during such examination, shall
not be considered an advance care planning consultation for purposes of
applying the 5-year limitation under paragraph (1).
``(B) An advance care planning consultation with respect to an
individual may be conducted more frequently than provided under
paragraph (1) if there is a significant change in the health condition
of the individual, including diagnosis of a chronic, progressive, life-
limiting disease, a life-threatening or terminal diagnosis or life-
threatening injury, or upon admission to a skilled nursing facility, a
long-term care facility (as defined by the Secretary), or a hospice
program.
``(4) A consultation under this subsection may include the
formulation of an order regarding life sustaining treatment or a
similar order.
``(5)(A) For purposes of this section, the term `order regarding life
sustaining treatment' means, with respect to an individual, an
actionable medical order relating to the treatment of that individual
that--
``(i) is signed and dated by a physician (as defined in
subsection (r)(1)) or another health care professional (as
specified by the Secretary and who is acting within the scope
of the professional's authority under State law in signing such
an order, including a nurse practitioner or physician
assistant) and is in a form that permits it to stay with the
individual and be followed by health care professionals and
providers across the continuum of care;
``(ii) effectively communicates the individual's preferences
regarding life sustaining treatment, including an indication of
the treatment and care desired by the individual;
``(iii) is uniquely identifiable and standardized within a
given locality, region, or State (as identified by the
Secretary); and
``(iv) may incorporate any advance directive (as defined in
section 1866(f)(3)) if executed by the individual.
``(B) The level of treatment indicated under subparagraph (A)(ii) may
range from an indication for full treatment to an indication to limit
some or all or specified interventions. Such indicated levels of
treatment may include indications respecting, among other items--
``(i) the intensity of medical intervention if the patient is
pulse less, apneic, or has serious cardiac or pulmonary
problems;
``(ii) the individual's desire regarding transfer to a
hospital or remaining at the current care setting;
``(iii) the use of antibiotics; and
``(iv) the use of artificially administered nutrition and
hydration.''.
(2) Payment.--Section 1848(j)(3) of such Act (42 U.S.C.
1395w-4(j)(3)) is amended by inserting ``(2)(FF),'' after
``(2)(EE),''.
(3) Frequency limitation.--Section 1862(a) of such Act (42
U.S.C. 1395y(a)) is amended--
(A) in paragraph (1)--
(i) in subparagraph (N), by striking ``and''
at the end;
(ii) in subparagraph (O) by striking the
semicolon at the end and inserting ``, and'';
and
(iii) by adding at the end the following new
subparagraph:
``(P) in the case of advance care planning
consultations (as defined in section 1861(hhh)(1)),
which are performed more frequently than is covered
under such section;''; and
(B) in paragraph (7), by striking ``or (K)'' and
inserting ``(K), or (P)''.
(4) Effective date.--The amendments made by this subsection
shall apply to consultations furnished on or after January 1,
2011.
(b) Expansion of Physician Quality Reporting Initiative for End of
Life Care.--
(1) Physician's quality reporting initiative.--Section
1848(k)(2) of the Social Security Act (42 U.S.C. 1395w-4(k)(2))
is amended by adding at the end the following new subparagraph:
``(E) Physician's quality reporting initiative.--
``(i) In general.--For purposes of reporting
data on quality measures for covered
professional services furnished during 2011 and
any subsequent year, to the extent that
measures are available, the Secretary shall
include quality measures on end of life care
and advanced care planning that have been
adopted or endorsed by a consensus-based
organization, if appropriate. Such measures
shall measure both the creation of and
adherence to orders for life-sustaining
treatment.
``(ii) Proposed set of measures.--The
Secretary shall publish in the Federal Register
proposed quality measures on end of life care
and advanced care planning that the Secretary
determines are described in subparagraph (A)
and would be appropriate for eligible
professionals to use to submit data to the
Secretary. The Secretary shall provide for a
period of public comment on such set of
measures before finalizing such proposed
measures.''.
(c) Inclusion of Information in Medicare & You Handbook.--
(1) Medicare & you handbook.--
(A) In general.--Not later than 1 year after the date
of the enactment of this Act, the Secretary of Health
and Human Services shall update the online version of
the Medicare & You Handbook to include the following:
(i) An explanation of advance care planning
and advance directives, including--
(I) living wills;
(II) durable power of attorney;
(III) orders of life-sustaining
treatment; and
(IV) health care proxies.
(ii) A description of Federal and State
resources available to assist individuals and
their families with advance care planning and
advance directives, including--
(I) available State legal service
organizations to assist individuals
with advance care planning, including
those organizations that receive
funding pursuant to the Older Americans
Act of 1965 (42 U.S.C. 93001 et seq.);
(II) website links or addresses for
State-specific advance directive forms;
and
(III) any additional information, as
determined by the Secretary.
(B) Update of paper and subsequent versions.--The
Secretary shall include the information described in
subparagraph (A) in all paper and electronic versions
of the Medicare & You Handbook that are published on or
after the date that is 1 year after the date of the
enactment of this Act.
SEC. 1234. PART B SPECIAL ENROLLMENT PERIOD AND WAIVER OF LIMITED
ENROLLMENT PENALTY FOR TRICARE BENEFICIARIES.
(a) Part B Special Enrollment Period.--
(1) In general.--Section 1837 of the Social Security Act (42
U.S.C. 1395p) is amended by adding at the end the following new
subsection:
``(l)(1) In the case of any individual who is a covered beneficiary
(as defined in section 1072(5) of title 10, United States Code) at the
time the individual is entitled to hospital insurance benefits under
part A under section 226(b) or section 226A and who is eligible to
enroll but who has elected not to enroll (or to be deemed enrolled)
during the individual's initial enrollment period, there shall be a
special enrollment period described in paragraph (2).
``(2) The special enrollment period described in this paragraph, with
respect to an individual, is the 12-month period beginning on the day
after the last day of the initial enrollment period of the individual
or, if later, the 12-month period beginning with the month the
individual is notified of enrollment under this section.
``(3) In the case of an individual who enrolls during the special
enrollment period provided under paragraph (1), the coverage period
under this part shall begin on the first day of the month in which the
individual enrolls or, at the option of the individual, on the first
day of the second month following the last month of the individual's
initial enrollment period.
``(4) The Secretary of Defense shall establish a method for
identifying individuals described in paragraph (1) and providing notice
to them of their eligibility for enrollment during the special
enrollment period described in paragraph (2).''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to elections made on or after the date of the
enactment of this Act.
(b) Waiver of Increase of Premium.--
(1) In general.--Section 1839(b) of the Social Security Act
(42 U.S.C. 1395r(b)) is amended by striking ``section
1837(i)(4)'' and inserting ``subsection (i)(4) or (l) of
section 1837''.
(2) Effective date.--
(A) In general.--The amendment made by paragraph (1)
shall apply with respect to elections made on or after
the date of the enactment of this Act.
(B) Rebates for certain disabled and esrd
beneficiaries.--
(i) In general.--With respect to premiums for
months on or after January 2005 and before the
month of the enactment of this Act, no increase
in the premium shall be effected for a month in
the case of any individual who is a covered
beneficiary (as defined in section 1072(5) of
title 10, United States Code) at the time the
individual is entitled to hospital insurance
benefits under part A of title XVIII of the
Social Security Act under section 226(b) or
226A of such Act, and who is eligible to
enroll, but who has elected not to enroll (or
to be deemed enrolled), during the individual's
initial enrollment period, and who enrolls
under this part within the 12-month period that
begins on the first day of the month after the
month of notification of entitlement under this
part.
(ii) Consultation with department of
defense.--The Secretary of Health and Human
Services shall consult with the Secretary of
Defense in identifying individuals described in
this paragraph.
(iii) Rebates.--The Secretary of Health and
Human Services shall establish a method for
providing rebates of premium increases paid for
months on or after January 1, 2005, and before
the month of the enactment of this Act for
which a penalty was applied and collected.
SEC. 1235. EXCEPTION FOR USE OF MORE RECENT TAX YEAR IN CASE OF GAINS
FROM SALE OF PRIMARY RESIDENCE IN COMPUTING PART B
INCOME-RELATED PREMIUM.
(a) In General.--Section 1839(i)(4)(C)(ii)(II) of the Social Security
Act (42 U.S.C. 1395r(i)(4)(C)(ii)(II)) is amended by inserting ``sale
of primary residence,'' after ``divorce of such individual,''.
(b) Effective Date.--The amendment made by subsection (a) shall apply
to premiums and payments for years beginning with 2011.
SEC. 1236. DEMONSTRATION PROGRAM ON USE OF PATIENT DECISIONS AIDS.
(a) In General.--The Secretary of Health and Human Services, acting
through the Center for Medicare and Medicaid Payment Innovation
established under section 1115A of the Social Security Act (as added by
section 1910) and consistent with the applicable provisions of such
section, shall establish a shared decision making demonstration program
(in this subsection referred to as the ``program'') under the Medicare
program using patient decision aids to meet the objective of improving
the understanding by Medicare beneficiaries of their medical treatment
options, as compared to comparable Medicare beneficiaries who do not
participate in a shared decision making process using patient decision
aids.
(b) Sites.--
(1) Enrollment.--The Secretary shall enroll in the program
not more than 30 eligible providers who have experience in
implementing, and have invested in the necessary infrastructure
to implement, shared decision making using patient decision
aids.
(2) Application.--An eligible provider seeking to participate
in the program shall submit to the Secretary an application at
such time and containing such information as the Secretary may
require.
(3) Preference.--In enrolling eligible providers in the
program, the Secretary shall give preference to eligible
providers that--
(A) have documented experience in using patient
decision aids for the conditions identified by the
Secretary and in using shared decision making;
(B) have the necessary information technology
infrastructure to collect the information required by
the Secretary for reporting purposes; and
(C) are trained in how to use patient decision aids
and shared decision making.
(c) Follow-up Counseling Visit.--
(1) In general.--An eligible provider participating in the
program shall routinely schedule Medicare beneficiaries for a
counseling visit after the viewing of such a patient decision
aid to answer any questions the beneficiary may have with
respect to the medical care of the condition involved and to
assist the beneficiary in thinking through how their
preferences and concerns relate to their medical care.
(2) Payment for follow-up counseling visit.--The Secretary
shall establish procedures for making payments for such
counseling visits provided to Medicare beneficiaries under the
program. Such procedures shall provide for the establishment--
(A) of a code (or codes) to represent such services;
and
(B) of a single payment amount for such service that
includes the professional time of the health care
provider and a portion of the reasonable costs of the
infrastructure of the eligible provider such as would
be made under the applicable payment systems to that
provider for similar covered services.
(d) Costs of Aids.--An eligible provider participating in the program
shall be responsible for the costs of selecting, purchasing, and
incorporating such patient decision aids into the provider's practice,
and reporting data on quality and outcome measures under the program.
(e) Funding.--The Secretary shall provide for the transfer from the
Federal Supplementary Medical 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 program.
(f) Waiver Authority.--The Secretary may waive such requirements of
titles XI and XVIII of the Social Security Act (42 U.S.C. 1301 et seq.
and 1395 et seq.) as may be necessary for the purpose of carrying out
the program.
(g) Report.--Not later than 12 months after the date of completion of
the program, the Secretary shall submit to Congress a report on such
program, together with recommendations for such legislation and
administrative action as the Secretary determines to be appropriate.
The final report shall include an evaluation of the impact of the use
of the program on health quality, utilization of health care services,
and on improving the quality of life of such beneficiaries.
(h) Definitions.--In this section:
(1) Eligible provider.--The term ``eligible provider'' means
the following:
(A) A primary care practice.
(B) A specialty practice.
(C) A multispecialty group practice.
(D) A hospital.
(E) A rural health clinic.
(F) A Federally qualified health center (as defined
in section 1861(aa)(4) of the Social Security Act (42
U.S.C. 1395x(aa)(4)).
(G) An integrated delivery system.
(H) A State cooperative entity that includes the
State government and at least one other health care
provider which is set up for the purpose of testing
shared decision making and patient decision aids.
(2) Patient decision aid.--The term ``patient decision aid''
means an educational tool (such as the Internet, a video, or a
pamphlet) that helps patients (or, if appropriate, the family
caregiver of the patient) understand and communicate their
beliefs and preferences related to their treatment options, and
to decide with their health care provider what treatments are
best for them based on their treatment options, scientific
evidence, circumstances, beliefs, and preferences.
(3) Shared decision making.--The term ``shared decision
making'' means a collaborative process between patient and
clinician that engages the patient in decision making, provides
patients with information about trade-offs among treatment
options, and facilitates the incorporation of patient
preferences and values into the medical plan.
TITLE III--PROMOTING PRIMARY CARE, MENTAL HEALTH SERVICES, AND
COORDINATED CARE
SEC. 1301. ACCOUNTABLE CARE ORGANIZATION PILOT PROGRAM.
Title XVIII of the Social Security Act is amended by inserting after
section 1866D, as added by section 1152(f) of this Act, the following
new section:
``accountable care organization pilot program
``Sec. 1866E. (a) Establishment.--
``(1) In general.--The Secretary shall conduct a pilot
program (in this section referred to as the `pilot program') to
test different payment incentive models, including (to the
extent practicable) the specific payment incentive models
described in subsection (c), designed to reduce the growth of
expenditures and improve health outcomes in the provision of
items and services under this title to applicable beneficiaries
(as defined in subsection (d)) by qualifying accountable care
organizations (as defined in subsection (b)(1)) in order to--
``(A) promote accountability for a patient population
and coordinate items and services under parts A and B;
``(B) encourage investment in infrastructure and
redesigned care processes for high quality and
efficient service delivery; and
``(C) reward physician practices and other physician
organizational models for the provision of high quality
and efficient health care services.
``(2) Scope.--The Secretary shall set specific goals for the
number of accountable care organizations, participating
practitioners, and patients served in the initial tests under
the pilot program to ensure that the pilot program is of
sufficient size and scope to--
``(A) test the approach involved in a variety of
settings, including urban, rural, and underserved
areas; and
``(B) subject to subsection (f)(1), disseminate such
approach rapidly on a national basis.
To the extent that the Secretary finds a qualifying accountable
care organization model to be successful in improving quality
and reducing costs, the Secretary shall attempt to attract at
least 10 percent of all eligible providers to act as
accountable care organizations and implement such mechanisms
and reforms within 5 years after the date of the enactment of
this section. If the Secretary further finds such accountable
care organization models to be successful, the Secretary shall
seek to implement such mechanisms and reforms on as large a
geographic scale as practical and economical.
``(b) Qualifying Accountable Care Organizations (ACOs).--
``(1) Qualifying aco defined.--In this section:
``(A) In general.--The terms `qualifying accountable
care organization' and `qualifying ACO' mean a group of
physicians or other physician organizational model (as
defined in subparagraph (D)) that--
``(i) is organized at least in part for the
purpose of providing physicians' services; and
``(ii) meets such criteria as the Secretary
determines to be appropriate to participate in
the pilot program, including the criteria
specified in paragraph (2).
``(B) Inclusion of other providers.--Nothing in this
subsection shall be construed as preventing a
qualifying ACO from including a hospital or any other
provider of services or supplier furnishing items or
services for which payment may be made under this title
that is affiliated with the ACO under an arrangement
structured so that such provider or supplier
participates in the pilot program and shares in any
incentive payments under the pilot program.
``(C) Physician.--The term `physician' includes,
except as the Secretary may otherwise provide, any
individual who furnishes services for which payment may
be made as physicians' services.
``(D) Other physician organizational model.--The term
`other physician organization model' means, with
respect to a qualifying ACO any model of organization
under which physicians enter into agreements with other
providers for the purposes of participation in the
pilot program in order to provide high quality and
efficient health care services and share in any
incentive payments under such program
``(E) Other services.--Nothing in this paragraph
shall be construed as preventing a qualifying ACO from
furnishing items or services, for which payment may not
be made under this title, for purposes of achieving
performance goals under the pilot program.
``(2) Qualifying criteria.--The following are criteria
described in this paragraph for an organized group of
physicians to be a qualifying ACO:
``(A) The group has a legal structure that would
allow the group to receive and distribute incentive
payments under this section.
``(B) The group includes a sufficient number of
primary care physicians (regardless of specialty) for
the applicable beneficiaries for whose care the group
is accountable (as determined by the Secretary).
``(C) The group reports on quality measures in such
form, manner, and frequency as specified by the
Secretary (which may be for the group, for providers of
services and suppliers, or both).
``(D) The group reports to the Secretary (in a form,
manner and frequency as specified by the Secretary)
such data as the Secretary determines appropriate to
monitor and evaluate the pilot program.
``(E) The group provides notice to applicable
beneficiaries regarding the pilot program (as
determined appropriate by the Secretary).
``(F) The group contributes to a best practices
network or website, that shall be maintained by the
Secretary for the purpose of sharing strategies on
quality improvement, care coordination, and efficiency
that the groups believe are effective.
``(G) The group utilizes patient-centered processes
of care, including those that emphasize patient and
caregiver involvement in planning and monitoring of
ongoing care management plan.
``(H) The group meets other criteria determined to be
appropriate by the Secretary.
``(c) Specific Payment Incentive Models.--The specific payment
incentive models described in this subsection are the following:
``(1) Performance target model.--Under the performance target
model under this paragraph (in this paragraph referred to as
the `performance target model'):
``(A) In general.--A qualifying ACO qualifies to
receive an incentive payment if expenditures for
applicable beneficiaries are less than a target
spending level or a target rate of growth. The
incentive payment shall be made only if savings are
greater than would result from normal variation in
expenditures for items and services covered under parts
A and B.
``(B) Computation of performance target.--
``(i) In general.--The Secretary shall
establish a performance target for each
qualifying ACO comprised of a base amount
(described in clause (ii)) increased to the
current year by an adjustment factor (described
in clause (iii)). Such a target may be
established on a per capita basis, as the
Secretary determines to be appropriate.
``(ii) Base amount.--For purposes of clause
(i), the base amount in this subparagraph is
equal to the average total payments (or allowed
charges) under parts A and B (and may include
part D, if the Secretary determines
appropriate) for applicable beneficiaries for
whom the qualifying ACO furnishes items and
services in a base period determined by the
Secretary. Such base amount may be determined
on a per capita basis.
``(iii) Adjustment factor.--For purposes of
clause (i), the adjustment factor in this
clause may equal an annual per capita amount
that reflects changes in expenditures from the
period of the base amount to the current year
that would represent an appropriate performance
target for applicable beneficiaries (as
determined by the Secretary). Such adjustment
factor may be determined as an amount or rate,
may be determined on a national, regional,
local, or organization-specific basis, and may
be determined on a per capita basis. Such
adjustment factor also may be adjusted for risk
as determined appropriate by the Secretary.
``(iv) Rebasing.--Under this model the
Secretary shall periodically rebase the base
expenditure amount described in clause (ii).
``(C) Meeting target.--
``(i) In general.--Subject to clause (ii), a
qualifying ACO that meet or exceeds annual
quality and performance targets for a year
shall receive an incentive payment for such
year equal to a portion (as determined
appropriate by the Secretary) of the amount by
which payments under this title for such year
relative are estimated to be below the
performance target for such year, as determined
by the Secretary. The Secretary may establish a
cap on incentive payments for a year for a
qualifying ACO.
``(ii) Limitation.--The Secretary shall limit
incentive payments to each qualifying ACO under
this paragraph as necessary to ensure that the
aggregate expenditures with respect to
applicable beneficiaries for such ACOs under
this title (inclusive of incentive payments
described in this subparagraph) do not exceed
the amount that the Secretary estimates would
be expended for such ACO for such beneficiaries
if the pilot program under this section were
not implemented.
``(D) Reporting and other requirements.--In carrying
out such model, the Secretary may (as the Secretary
determines to be appropriate) incorporate reporting
requirements, incentive payments, and penalties related
to the physician quality reporting initiative (PQRI),
electronic prescribing, electronic health records, and
other similar initiatives under section 1848, and may
use alternative criteria than would otherwise apply
under such section for determining whether to make such
payments. The incentive payments described in this
subparagraph shall not be included in the limit
described in subparagraph (C)(ii) or in the performance
target model described in this paragraph.
``(2) Partial capitation model.--
``(A) In general.--Subject to subparagraph (B), a
partial capitation model described in this paragraph
(in this paragraph referred to as a `partial capitation
model') is a model in which a qualifying ACO would be
at financial risk for some, but not all, of the items
and services covered under parts A and B, such as at
risk for some or all physicians' services or all items
and services under part B. The Secretary may limit a
partial capitation model to ACOs that are highly
integrated systems of care and to ACOs capable of
bearing risk, as determined to be appropriate by the
Secretary.
``(B) No additional program expenditures.--Payments
to a qualifying ACO for applicable beneficiaries for a
year under the partial capitation model shall be
established in a manner that does not result in
spending more for such ACO for such beneficiaries than
would otherwise be expended for such ACO for such
beneficiaries for such year if the pilot program were
not implemented, as estimated by the Secretary.
``(3) Other payment models.--
``(A) In general.--Subject to subparagraph (B), the
Secretary may develop other payment models that meet
the goals of this pilot program to improve quality and
efficiency.
``(B) No additional program expenditures.--
Subparagraph (B) of paragraph (2) shall apply to a
payment model under subparagraph (A) in a similar
manner as such subparagraph (B) applies to the payment
model under paragraph (2).
``(d) Applicable Beneficiaries.--
``(1) In general.--In this section, the term `applicable
beneficiary' means, with respect to a qualifying ACO, an
individual who--
``(A) is enrolled under part B and entitled to
benefits under part A;
``(B) is not enrolled in a Medicare Advantage plan
under part C or a PACE program under section 1894; and
``(C) meets such other criteria as the Secretary
determines appropriate, which may include criteria
relating to frequency of contact with physicians in the
ACO
``(2) Following applicable beneficiaries.--The Secretary may
monitor data on expenditures and quality of services under this
title after an applicable beneficiary discontinues receiving
services under this title through a qualifying ACO.
``(e) Implementation.--
``(1) Starting date.--The pilot program shall begin no later
than January 1, 2012. An agreement with a qualifying ACO under
the pilot program may cover a multi-year period of between 3
and 5 years.
``(2) Waiver.--The Secretary may waive such provisions of
this title (including section 1877) and title XI in the manner
the Secretary determines necessary in order implement the pilot
program.
``(3) Performance results reports.--The Secretary shall
report performance results to qualifying ACOs under the pilot
program at least annually.
``(4) Limitations on review.--There shall be no
administrative or judicial review under section 1869, section
1878, or otherwise of--
``(A) the elements, parameters, scope, and duration
of the pilot program;
``(B) the selection of qualifying ACOs for the pilot
program;
``(C) the establishment of targets, measurement of
performance, determinations with respect to whether
savings have been achieved and the amount of savings;
``(D) determinations regarding whether, to whom, and
in what amounts incentive payments are paid; and
``(E) decisions about the extension of the program
under subsection (g), expansion of the program under
subsection (h) or extensions under subsection (i).
``(5) Administration.--Chapter 35 of title 44, United States
Code shall not apply to this section.
``(f) Evaluation; Monitoring.--
``(1) In general.--The Secretary shall evaluate the payment
incentive model for each qualifying ACO under the pilot program
to assess impacts on beneficiaries, providers of services,
suppliers and the program under this title. The Secretary shall
make such evaluation publicly available within 60 days of the
date of completion of such report.
``(2) Monitoring.--The Inspector General of the Department of
Health and Human Services shall provide for monitoring of the
operation of ACOs under the pilot program with regard to
violations of section 1877 (popularly known as the `Stark
law').
``(g) Extension of Pilot Agreement With Successful Organizations.--
``(1) Reports to congress.--Not later than 2 years after the
date the first agreement is entered into under this section,
and biennially thereafter for six years, the Secretary shall
submit to Congress and make publicly available a report on the
use of authorities under the pilot program. Each report shall
address the impact of the use of those authorities on
expenditures, access, and quality under this title.
``(2) Extension.--Subject to the report provided under
paragraph (1), with respect to a qualifying ACO, the Secretary
may extend the duration of the agreement for such ACO under the
pilot program as the Secretary determines appropriate if--
``(A) the ACO receives incentive payments with
respect to any of the first 4 years of the pilot
agreement and is consistently meeting quality standards
or
``(B) the ACO is consistently exceeding quality
standards and is not increasing spending under the
program.
``(3) Termination.--The Secretary may terminate an agreement
with a qualifying ACO under the pilot program if such ACO did
not receive incentive payments or consistently failed to meet
quality standards in any of the first 3 years under the
program.
``(h) Expansion to Additional ACOs.--
``(1) Testing and refinement of payment incentive models.--
Subject to the evaluation described in subsection (f), the
Secretary may enter into agreements under the pilot program
with additional qualifying ACOs to further test and refine
payment incentive models with respect to qualifying ACOs.
``(2) Expanding use of successful models to program
implementation.--
``(A) In general.--Subject to subparagraph (B), the
Secretary may issue regulations to implement, on a
permanent basis, 1 or more models if, and to the extent
that, such models are beneficial to the program under
this title, as determined by the Secretary.
``(B) Certification.--The Chief Actuary of the
Centers for Medicare & Medicaid Services shall certify
that 1 or more of such models described in subparagraph
(A) would result in estimated spending that would be
less than what spending would otherwise be estimated to
be in the absence of such expansion.
``(i) Treatment of Physician Group Practice Demonstration.--
``(1) Extension.--The Secretary may enter in to an agreement
with a qualifying ACO under the demonstration under section
1866A, subject to rebasing and other modifications deemed
appropriate by the Secretary, until the pilot program under
this section is operational.
``(2) Transition.--For purposes of extension of an agreement
with a qualifying ACO under subsection (g)(2), the Secretary
shall treat receipt of an incentive payment for a year by an
organization under the physician group practice demonstration
pursuant to section 1866A as a year for which an incentive
payment is made under such subsection, as long as such practice
group practice organization meets the criteria under subsection
(b)(2).
``(j) Additional Provisions.--
``(1) Authority for separate incentive arrangements.--The
Secretary may create separate incentive arrangements (including
using multiple years of data, varying thresholds, varying
shared savings amounts, and varying shared savings limits) for
different categories of qualifying ACOs to reflect natural
variations in data availability, variation in average annual
attributable expenditures, program integrity, and other matters
the Secretary deems appropriate.
``(2) Encouragement of participation of smaller
organizations.--In order to encourage the participation of
smaller accountable care organizations under the pilot program,
the Secretary may limit a qualifying ACO's exposure to high
cost patients under the program.
``(3) Treatment of high-cost beneficiaries with chronic
diseases.--Nothing in this section shall be construed as
preventing a qualifying ACO from entering into an arrangement
with an Independence at Home Medical Practice or from providing
home based services for the treatment of beneficiaries who are
eligible for that program.
``(4) Involvement in private payer arrangements.--Nothing in
this section shall be construed as preventing qualifying ACOs
participating in the pilot program from negotiating similar
contracts with private payers.
``(5) Antidiscrimination limitation.--The Secretary shall not
enter into an agreement with an entity to provide health care
items or services under the pilot program, or with an entity to
administer the program, unless such entity guarantees that it
will not deny, limit, or condition the coverage or provision of
benefits under the program, for individuals eligible to be
enrolled under such program, based on any health status-related
factor described in section 2702(a)(1) of the Public Health
Service Act.
``(6) Construction.--Nothing in this section shall be
construed to compel or require an organization to use an
organization-specific target growth rate for an accountable
care organization under this section for purposes of section
1848.
``(7) Funding.--For purposes of administering and carrying
out the pilot program, other than for payments for items and
services furnished under this title and incentive payments
under subsection (c)(1), in addition to funds otherwise
appropriated, there are appropriated to the Secretary for the
Center for Medicare & Medicaid Services Program Management
Account $25,000,000 for each of fiscal years 2010 through 2014
and $20,000,000 for fiscal year 2015. Amounts appropriated
under this paragraph for a fiscal year shall be available until
expended.''.
SEC. 1302. MEDICAL HOME PILOT PROGRAM.
(a) In General.--Title XVIII of the Social Security Act is amended by
inserting after section 1866E, as inserted by section 1301, the
following new section:
``medical home pilot program
``Sec. 1866F. (a) Establishment and Medical Home Models.--
``(1) Establishment of pilot program.--The Secretary shall
establish a medical home pilot program (in this section
referred to as the `pilot program') for the purpose of
evaluating the feasibility and advisability of reimbursing
qualified patient-centered medical homes for furnishing medical
home services (as defined under subsection (b)(1)) to high need
beneficiaries (as defined in subsection (d)(1)(C)) and to
targeted high need beneficiaries (as defined in subsection
(c)(1)(C)).
``(2) Scope.--Subject to subsection (g), the Secretary shall
set specific goals for the number of practices and communities,
and the number of patients served, under the pilot program in
the initial tests to ensure that the pilot program is of
sufficient size and scope to--
``(A) test the approach involved in a variety of
settings, including urban, rural, and underserved
areas; and
``(B) subject to subsection (e)(1), disseminate such
approach rapidly on a national basis.
To the extent that the Secretary finds a medical home model to
be successful in improving quality and reducing costs, the
Secretary shall implement such mechanisms and reforms on as
large a geographic scale as practical and economical.
``(3) Models of medical homes in the pilot program.--The
pilot program shall evaluate each of the following medical home
models:
``(A) Independent patient-centered medical home
model.--Independent patient-centered medical home model
under subsection (c).
``(B) Community-based medical home model.--Community-
based medical home model under subsection (d).
``(4) Participation of nurse practitioners and physician
assistants.--
``(A) Nothing in this section shall be construed as
preventing a nurse practitioner from leading a patient
centered medical home so long as--
``(i) all the requirements of this section
are met; and
``(ii) the nurse practitioner is acting
consistently with State law.
``(B) Nothing in this section shall be construed as
preventing a physician assistant from participating in
a patient centered medical home so long as--
``(i) all the requirements of this section
are met; and
``(ii) the physician assistant is acting
consistently with State law.
``(b) Definitions.--For purposes of this section:
``(1) Patient-centered medical home services.--The term
`patient-centered medical home services' means services that--
``(A) provide beneficiaries with direct and ongoing
access to a primary care or principal care by a
physician or nurse practitioner who accepts
responsibility for providing first contact, continuous
and comprehensive care to such beneficiary;
``(B) coordinate the care provided to a beneficiary
by a team of individuals at the practice level across
office, institutional and home settings led by a
primary care or principal care physician or nurse
practitioner, as needed and appropriate;
``(C) provide for all the patient's health care needs
or take responsibility for appropriately arranging care
with other qualified providers for all stages of life;
``(D) provide continuous access to care and
communication with participating beneficiaries;
``(E) provide support for patient self-management,
proactive and regular patient monitoring, support for
family caregivers, use patient-centered processes, and
coordination with community resources;
``(F) integrate readily accessible, clinically useful
information on participating patients that enables the
practice to treat such patients comprehensively and
systematically; and
``(G) implement evidence-based guidelines and apply
such guidelines to the identified needs of
beneficiaries over time and with the intensity needed
by such beneficiaries.
``(2) Primary care.--The term `primary care' means health
care that is provided by a physician, nurse practitioner, or
physician assistant who practices in the field of family
medicine, general internal medicine, geriatric medicine, or
pediatric medicine.
``(3) Principal care.--The term `principal care' means
integrated, accessible health care that is provided by a
physician who is a medical subspecialist that addresses the
majority of the personal health care needs of patients with
chronic conditions requiring the subspecialist's expertise, and
for whom the subspecialist assumes care management.
``(c) Independent Patient-centered Medical Home Model.--
``(1) In general.--
``(A) Payment authority.--Under the independent
patient-centered medical home model under this
subsection, the Secretary shall make payments for
medical home services furnished by an independent
patient-centered medical home (as defined in
subparagraph (B)) pursuant to paragraph (3)(B) for a
targeted high need beneficiaries (as defined in
subparagraph (C)).
``(B) Independent patient-centered medical home
defined.--In this section, the term `independent
patient-centered medical home' means a physician-
directed or nurse-practitioner-directed practice that
is qualified under paragraph (2) as--
``(i) providing beneficiaries with patient-
centered medical home services; and
``(ii) meets such other requirements as the
Secretary may specify.
``(C) Targeted high need beneficiary defined.--For
purposes of this subsection, the term `targeted high
need beneficiary' means a high need beneficiary who,
based on a risk score as specified by the Secretary, is
generally within the upper 50th percentile of Medicare
beneficiaries.
``(D) Beneficiary election to participate.--The
Secretary shall determine an appropriate method of
ensuring that beneficiaries have agreed to participate
in the pilot program.
``(E) Implementation.--The pilot program under this
subsection shall begin no later than 6 months after the
date of the enactment of this section.
``(2) Standard setting and qualification process for patient-
centered medical homes.--The Secretary shall review alternative
models for standard setting and qualification, and shall
establish a process--
``(A) to establish standards to enable medical
practices to qualify as patient-centered medical homes;
and
``(B) to initially provide for the review and
certification of medical practices as meeting such
standards.
``(3) Payment.--
``(A) Establishment of methodology.--The Secretary
shall establish a methodology for the payment for
medical home services furnished by independent patient-
centered medical homes. Under such methodology, the
Secretary shall adjust payments to medical homes based
on beneficiary risk scores to ensure that higher
payments are made for higher risk beneficiaries.
``(B) Per beneficiary per month payments.--Under such
payment methodology, the Secretary shall pay
independent patient-centered medical homes a monthly
fee for each targeted high need beneficiary who
consents to receive medical home services through such
medical home.
``(C) Prospective payment.--The fee under
subparagraph (B) shall be paid on a prospective basis.
``(D) Amount of payment.--In determining the amount
of such fee, the Secretary shall consider the
following:
``(i) The clinical work and practice expenses
involved in providing the medical home services
provided by the independent patient-centered
medical home (such as providing increased
access, care coordination, population disease
management, and teaching self-care skills for
managing chronic illnesses) for which payment
is not made under this title as of the date of
the enactment of this section.
``(ii) Allow for differential payments based
on capabilities of the independent patient-
centered medical home.
``(iii) Use appropriate risk-adjustment in
determining the amount of the per beneficiary
per month payment under this paragraph in a
manner that ensures that higher payments are
made for higher risk beneficiaries.
``(4) Encouraging participation of variety of practices.--The
pilot program under this subsection shall be designed to
include the participation of physicians in practices with fewer
than 10 full-time equivalent physicians, as well as physicians
in larger practices, particularly in underserved and rural
areas, as well as federally qualified community health centers,
and rural health centers.
``(5) No duplication in pilot participation.--A physician in
a group practice that participates in the accountable care
organization pilot program under section 1866D shall not be
eligible to participate in the pilot program under this
subsection, unless the pilot program under this section has
been implemented on a permanent basis under subsection (e)(3).
``(d) Community-based Medical Home Model.--
``(1) In general.--
``(A) Authority for payments.--Under the community-
based medical home model under this subsection (in this
section referred to as the `CBMH model'), the Secretary
shall make payments for the furnishing of medical home
services by a community-based medical home (as defined
in subparagraph (B)) pursuant to paragraph (5)(B) for
high need beneficiaries.
``(B) Community-based medical home defined.--In this
section, the term `community-based medical home' means
a nonprofit community-based or State-based organization
that is certified under paragraph (2) as meeting the
following requirements:
``(i) The organization provides beneficiaries
with medical home services.
``(ii) The organization provides medical home
services under the supervision of and in close
collaboration with the primary care or
principal care physician, nurse practitioner,
or physician assistant designated by the
beneficiary as his or her community-based
medical home provider.
``(iii) The organization employs community
health workers, including nurses or other non-
physician practitioners, lay health workers, or
other persons as determined appropriate by the
Secretary, that assist the primary or principal
care physician, nurse practitioner, or
physician assistant in chronic care management
activities such as teaching self-care skills
for managing chronic illnesses, transitional
care services, care plan setting, medication
therapy management services for patients with
multiple chronic diseases, or help
beneficiaries access the health care and
community-based resources in their local
geographic area.
``(iv) The organization meets such other
requirements as the Secretary may specify.
``(C) High need beneficiary.--In this section, the
term `high need beneficiary' means an individual who
requires regular medical monitoring, advising, or
treatment, including such an individual with cognitive
impairment that leads to functional impairment.
``(2) Qualification process for community-based medical
homes.--The Secretary shall establish a process--
``(A) for the initial qualification of community-
based or State-based organizations as community-based
medical homes; and
``(B) to provide for the review and qualification of
such community-based and State-based organizations
pursuant to criteria established by the Secretary.
``(3) Duration.--The pilot program for community-based
medical homes under this subsection shall start no later than 2
years after the date of the enactment of this section. Each
demonstration site under the pilot program shall operate for a
period of up to 5 years after the initial implementation phase,
without regard to the receipt of a initial implementation
funding under subsection (i).
``(4) Preference.--In selecting sites for the CBMH model, the
Secretary shall seek to eliminate racial, ethnic, gender, and
geographic health disparities and may give preference to--
``(A) applications from geographic areas that propose
to coordinate health care services for chronically ill
beneficiaries across a variety of health care settings,
such as primary care physician practices with fewer
than 10 physicians, specialty physicians, nurse
practitioner practices, Federally qualified health
centers, rural health clinics, and other settings;
``(B) applications that include other payors that
furnish medical home services for chronically ill
patients covered by such payors; and
``(C) applications from States that propose to use
the medical home model to coordinate health care
services for individuals enrolled under this title,
individuals enrolled under title XIX, and full-benefit
dual eligible individuals (as defined in section
1935(c)(6)) with chronic diseases across a variety of
health care settings.
``(5) Payments.--
``(A) Establishment of methodology.--The Secretary
shall establish a methodology for the payment for
medical home services furnished under the CBMH model.
``(B) Per beneficiary per month payments.--Under such
payment methodology, the Secretary shall make two
separate monthly payments for each high need
beneficiary who consents to receive medical home
services through such medical home, as follows:
``(i) Payment to community-based
organization.--One monthly payment to a
community-based or State-based organization.
``(ii) Payment to primary or principal care
practice.--One monthly payment to the primary
or principal care practice for such
beneficiary.
``(C) Prospective payment.--The payments under
subparagraph (B) shall be paid on a prospective basis.
``(D) Amount of payment.--In determining the amount
of such payment, the Secretary shall consider the
following:
``(i) The clinical work and practice expenses
involved in providing the medical home services
provided by the community-based medical home
(such as providing increased access, care
coordination, care plan setting, population
disease management, and teaching self-care
skills for managing chronic illnesses) for
which payment is not made under this title as
of the date of the enactment of this section.
``(ii) Use appropriate risk-adjustment in
determining the amount of the per beneficiary
per month payment under this paragraph.
``(6) Initial implementation funding.--The Secretary may make
available initial implementation funding to a community based
or State-based organization or a State that is participating in
the pilot program under this subsection. Such organization
shall provide the Secretary with a detailed implementation plan
that includes how such funds will be used. The Secretary shall
select a territory of the United States as one of the locations
in which to implement the pilot program under this subsection.
``(e) Expansion of Program.--
``(1) Evaluation of cost and quality.--The Secretary shall
evaluate the pilot program to determine--
``(A) the extent to which medical homes result in--
``(i) improvement in the quality and
coordination of health care services,
particularly with regard to the care of complex
patients;
``(ii) improvement in reducing health
disparities;
``(iii) reductions in preventable
hospitalizations;
``(iv) prevention of readmissions;
``(v) reductions in emergency room visits;
``(vi) improvement in health outcomes,
including patient functional status where
applicable;
``(vii) improvement in patient satisfaction;
``(viii) improved efficiency of care such as
reducing duplicative diagnostic tests and
laboratory tests; and
``(ix) reductions in health care
expenditures; and
``(B) the feasability and advisability of reimbursing
medical homes for medical home services under this
title on a permanent basis.
``(2) Report.--Not later than 60 days after the date of
completion of the evaluation under paragraph (1), the Secretary
shall submit to Congress and make available to the public a
report on the findings of the evaluation under paragraph (1).
``(3) Expansion of program.--
``(A) In general.--Subject to the results of the
evaluation under paragraph (1) and subparagraph (B),
the Secretary may issue regulations to implement, on a
permanent basis, one or more models, if, and to the
extent that such model or models, are beneficial to the
program under this title, including that such
implementation will improve quality of care, as
determined by the Secretary.
``(B) Certification requirement.--The Secretary may
not issue such regulations unless the Chief Actuary of
the Centers for Medicare & Medicaid Services certifies
that the expansion of the components of the pilot
program described in subparagraph (A) would result in
estimated spending under this title that would be no
more than the level of spending that the Secretary
estimates would otherwise be spent under this title in
the absence of such expansion.
``(f) Administrative Provisions.--
``(1) No duplication in payments.--During any month, the
Secretary may not make payments under this section under more
than one model or through more than one medical home under any
model for the furnishing of medical home services to an
individual.
``(2) No effect on payment for evaluation and management
services.--Payments made under this section are in addition to,
and have no effect on the amount of, payment for evaluation and
management services made under this title
``(3) Administration.--Chapter 35 of title 44, United States
Code shall not apply to this section.
``(g) Funding.--
``(1) Operational costs.--For purposes of administering and
carrying out the pilot program (including the design,
implementation, technical assistance for and evaluation of such
program), in addition to funds otherwise available, there shall
be transferred from the Federal Supplementary Medical Insurance
Trust Fund under section 1841 to the Secretary for the Centers
for Medicare & Medicaid Services Program Management Account
$6,000,000 for each of fiscal years 2010 through 2014. Amounts
appropriated under this paragraph for a fiscal year shall be
available until expended.
``(2) Patient-centered medical home services.--In addition to
funds otherwise available, there shall be available to the
Secretary for the Centers for Medicare & Medicaid Services,
from the Federal Supplementary Medical Insurance Trust Fund
under section 1841--
``(A) $200,000,000 for each of fiscal years 2010
through 2014 for payments for medical home services
under subsection (c)(3); and
``(B) $125,000,000 for each of fiscal years 2012
through 2016, for payments under subsection (d)(5).
Amounts available under this paragraph for a fiscal year shall
be available until expended.
``(3) Initial implementation.--In addition to funds otherwise
available, there shall be available to the Secretary for the
Centers for Medicare & Medicaid Services, from the Federal
Supplementary Medical Insurance Trust Fund under section 1841,
$2,500,000 for each of fiscal years 2010 through 2012, under
subsection (d)(6). Amounts available under this paragraph for a
fiscal year shall be available until expended.
``(h) Treatment of TRHCA Medicare Medical Home Demonstration
Funding.--
``(1) In addition to funds otherwise available for payment of
medical home services under subsection (c)(3), there shall also
be available the amount provided in subsection (g) of section
204 of division B of the Tax Relief and Health Care Act of 2006
(42 U.S.C. 1395b-1 note).
``(2) Notwithstanding section 1302(c) of the America's
Affordable Health Choices Act of 2009, in addition to funds
provided in paragraph (1) and subsection (g)(2)(A), the funding
for medical home services that would otherwise have been
available if such section 204 medical home demonstration had
been implemented (without regard to subsection (g) of such
section) shall be available to the independent patient-centered
medical home model described in subsection (c).''.
(b) Effective Date.--The amendment made by this section shall apply
to services furnished on or after the date of the enactment of this
Act.
(c) Conforming Repeal.--Section 204 of division B of the Tax Relief
and Health Care Act of 2006 (42 U.S.C. 1395b-1 note), as amended by
section 133(a)(2) of the Medicare Improvements for Patients and
Providers Act of 2008 (Public Law 110-275), is repealed.
SEC. 1303. INDEPENDENCE AT HOME PILOT PROGRAM.
Title XVIII of the Social Security Act is amended by inserting after
section 1866F, as inserted by section 1302, the following new section:
``independence at home medical practice pilot program
``Sec. 1866G. (a) In General.--The Secretary shall conduct a pilot
program (in this section referred to as the `pilot program') to test a
payment incentive and service delivery model that utilizes physician
and nurse practitioner directed home-based primary care teams designed
to reduce expenditures and improve health outcomes in the provision of
items and services under this title to applicable beneficiaries (as
defined in subsection (d)). The pilot program tests whether such a
model, which is accountable for providing comprehensive, coordinated,
continuous, and accessible care to high-need populations at home and
coordinating health care across all treatment settings, results in--
``(1) reducing preventable hospitalizations;
``(2) preventing hospital readmissions;
``(3) reducing emergency room visits;
``(4) improving health outcomes;
``(5) improving the efficiency of care, such as by reducing
duplicative diagnostic and laboratory tests;
``(6) reducing the cost of health care services covered under
this title; and
``(7) achieving beneficiary and family caregiver
satisfaction.
``(b) Qualifying Independence at Home Medical Practice.--
``(1) Definition.--In this section, the term `qualifying
independence at home medical practice' means a legal entity
comprised of an individual physician or nurse practitioner or
group of physicians and nurse practitioners who are certified
or have experience and training in providing home-based primary
care services to high cost chronically ill beneficiaries as
determined appropriate by the Secretary and which has entered
into an agreement with the Secretary. Care is provided by a
team, including physicians, nurses, physician assistants,
pharmacists, and other health and social services staff as
appropriate who are certified or have experience providing
home-based primary care to applicable beneficiaries, make in-
home visits and carry out plans of care that are tailored to
the individual beneficiary's chronic conditions and designed to
achieve the results in subsection (a) and report the clinical
and quality of care outcomes as determined by the Secretary.
The pilot program shall be designed to include the
participation of physician and nurse practitioner practices
with fewer than 10 full-time equivalent physicians, as well as
physicians in larger practices, particularly in underserved
rural areas.
``(2) Participation of nurse practitioners and physician
assistants.--Nothing in this section shall be construed to
prevent a nurse practitioner or physician assistant from
leading a home-based primary care team as part of an
Independence at Home Medical Practice if--
``(A) all the requirements of this section are met;
and
``(B) the nurse practitioner or physician assistant,
as the case may be, is acting consistently with State
law.
``(3) Inclusion of providers and practitioners.--Nothing in
this subsection shall be construed as preventing a qualifying
Independence at Home Medical Practice from including a provider
or participating practitioner that is affiliated with the
medical practice under an arrangement structured so that such
provider or practitioner participates in the pilot program and
shares in any savings under the pilot program.
``(c) Payment.--
``(1) Shared savings.--A qualifying Independence at Home
Medical Practice may receive 80 percent of savings in excess of
5 percent if expenditures under this title for applicable
beneficiaries participating in the pilot program are at least 5
percent less than a target spending level or a target rate of
growth. The shared savings payment shall be made only if
savings are at a minimum 5 percent greater than would result
from normal variation in expenditures for items and services
covered under parts A and B (and part D to the extent the
Secretary decides to include such costs).
``(2) Establishment of levels, thresholds, and limits.--The
Secretary may establish target spending levels, savings
thresholds, and limits on shared savings amounts for each
participating Independence at Home Medical Practice based upon
the size of the practice, characteristics of the enrolled
individuals, and such other factors as the Secretary determines
appropriate.
``(3) Interim payments.--A qualifying Independence at Home
Medical Practice may receive payments for geriatric assessments
and monthly care coordination services as determined by the
Secretary but in the event that an Independence at Home Medical
Practice does not achieve the required savings in this
subsection, those payments or a fraction of them, as
appropriate, are at risk of being recouped by the Secretary to
ensure that no Independence at Home Medical Practice receives
Medicare payments in excess of what Medicare otherwise would
have paid for the services provided to the beneficiaries
receiving medical care from the Independence at Home Medical
Practice in the absence of the pilot program.
``(4) Assurance of financial solvency.--In order to receive
payments under paragraph (3), a qualifying Independence at Home
Medical Practice shall demonstrate to the satisfaction of the
Secretary that the organization is able to assume financial
risk for the 5 percent savings requirements through available
reserves, reinsurance, or withholding of funding provided under
this title, or such other means as the Secretary determines
appropriate.
``(5) No additional program expenditures.--The Secretary
shall limit shared savings payments to each qualifying
Independence at Home Medical Practice under this subsection as
necessary to ensure that the aggregate expenditures with
respect to applicable beneficiaries for such Independence at
Home Medical Practice under this title (inclusive of shared
savings payments described in this paragraph) do not exceed the
amount that the Secretary estimates would be expended for such
Independence at Home Medical Practice for such beneficiaries if
the pilot program under this section were not implemented.
``(d) Applicable Beneficiaries.--
``(1) Definition.--In this section, the term `applicable
beneficiary' means, with respect to a qualifying Independence
at Home Medical Practice, an individual who--
``(A) is enrolled under part B and entitled to
benefits under part A;
``(B) is not enrolled in a Medicare Advantage plan
under part C or a PACE program under section 1894;
``(C) is in the top 20 percent of Medicare patient
risk scores;
``(D) has two or more chronic illnesses, including
congestive heart failure, diabetes, chronic obstructive
pulmonary disease, ischemic heart disease, stroke,
Alzheimer's Disease and other dementias designated by
the Secretary, pressure ulcers, hypertension,
neurodegenerative diseases designated by the Secretary
which result in high costs under this title including
amyotropic lateral sclerosis (ALS), multiple sclerosis,
and Parkinson's disease, and other chronic conditions
identified by the Secretary that result in high costs
when in combination with one or more of the diseases
listed in this subparagraph;
``(E) had a nonelective hospital admission within the
past 12 months;
``(F) has received acute or subacute rehabilitation
services;
``(G) continues to have two or more functional
dependencies requiring the assistance of another person
(for example, bathing, dressing, toileting, walking, or
feeding); and
``(H) fulfills such other criteria as the Secretary
determines appropriate.
``(2) Publication of requirements.--The Secretary shall
publish eligibility requirements for beneficiaries that are
sufficiently clear to be understood by beneficiaries and the
individuals providing services to them as part of the pilot
program.
``(3) Patient election to participate.--The Secretary shall
determine an appropriate method of ensuring that applicable
beneficiaries have agreed to participate in an Independence at
Home Medical Practice. Participation shall be entirely
voluntary.
``(4) Beneficiary access to services.--Except as provided in
subsection (e)(2), nothing in this section shall be construed
as encouraging physicians or nurse practitioners to limit
beneficiary access to services covered under title XVIII and
beneficiaries shall not be required to relinquish access to any
benefit under this title as a condition of receiving services
from an Independence at Home Medical Practice.
``(e) Implementation.--
``(1) Starting date.--The pilot program shall begin not later
than January 1, 2012. An agreement with a qualifying
Independence at Home Medical Practice under the pilot program
may cover a 3 year period.
``(2) No duplication in pilot participation.--A physician or
nurse practitioner who participates in the accountable care
organization pilot program under section 1866D or the medical
home pilot program under section 1866E shall not be eligible to
participate in the pilot program under this subsection.
``(3) Preference.--In approving an Independence at Home
Medical Practice, the Secretary shall give preference to
medical practices that are--
``(A) located in high cost areas of the country;
``(B) have experience in furnishing health care
services to applicable beneficiaries in the home; and
``(C) use electronic medical records, health
information technology, and individualized plans of
care.
``(4) Waiver.--The Secretary may waive such provisions of
this title (including section 1877) and title XI in the manner
the Secretary determines necessary in order implement the pilot
program.
``(5) Administration.--Chapter 35 of title 44, United States
Code shall not apply to this section.
``(f) Minimum Number of Sites.--To the extent practicable, at least
two unaffiliated Independence at Home Medical Practices will be
established in the 13 highest cost States and the District of Columbia
and in 13 additional States that are representative of other regions of
the United States and include medically underserved rural and urban
areas as determined by the Secretary.
``(g) Evaluation and Monitoring.--The Secretary shall annually
evaluate each qualifying Independence at Home Medical Practice under
the pilot program to assess whether it achieved the minimum savings of
5 percent and the results described in subsection (a). The Secretary
shall have the discretion to terminate an agreement with an
Independence at Home Medical Practice that fails to achieve a
preponderance of those results. The Secretary shall make evaluations
publicly available within 60 days of the date of completion of such
report.
``(h) Reports to Congress.--Not later than 2 years after the date the
first agreement is entered into under this section, and biennially
thereafter until the pilot is completed, the Secretary shall submit to
Congress and make publicly available a report on best practices under
the pilot program. Each report shall address the impact of such best
practices on expenditures, access, and quality under this title.
``(i) Expansion to Program Implementations.--
``(1) Testing and refinement of payment incentive and service
delivery models.--Subject to the evaluation described in
subsection (f), the Secretary may enter into agreements under
the pilot program with additional qualifying Independence at
Home Medical Practices to further test and refine models with
respect to qualifying Independence at Home Medical Practices.
``(2) Expanding use of successful models to program
implementation.--
``(A) In general.--Subject to subparagraph (B), the
Secretary may issue regulations to implement, on a
permanent basis, the Independence at Home Medical
Practice Model if, and to the extent that, such models
are beneficial to the program under this title, as
determined by the Secretary.
``(B) Certification.--The Chief Actuary of the
Centers for Medicare and Medicaid Services shall
certify that the Independence at Home Medical Model
described in subparagraph (A) would result in estimated
spending that would be less than what spending would
otherwise be estimated to be in the absence of such
expansion.
``(j) Funding.--For purposes of administering and carrying out the
pilot program, other than for payments for items and services furnished
under this title, shared savings and monthly fees, or other payments
under subsection (c), in addition to funds otherwise appropriated,
there are appropriated to the Secretary for the Center for Medicare and
Medicaid Services Program Management Account $5,000,000 for each of
fiscal years 2010 through 2014. Amounts appropriated under this
paragraph for a fiscal year shall be available until expended.''.
SEC. 1304. PAYMENT INCENTIVE FOR SELECTED PRIMARY CARE SERVICES.
(a) In General.--Section 1833 of the Social Security Act is amended
by inserting after subsection (o) the following new subsection:
``(p) Primary Care Payment Incentives.--
``(1) In general.--In the case of primary care services (as
defined in paragraph (2)) furnished on or after January 1,
2011, by a primary care practitioner (as defined in paragraph
(3)) for which amounts are payable under section 1848, in
addition to the amount otherwise paid under this part there
shall also be paid to the practitioner (or to an employer or
facility in the cases described in clause (A) of section
1842(b)(6)) (on a monthly or quarterly basis) from the Federal
Supplementary Medical Insurance Trust Fund an amount equal 5
percent (or 10 percent if the practitioner predominately
furnishes such services in an area that is designated (under
section 332(a)(1)(A) of the Public Health Service Act) as a
primary care health professional shortage area.
``(2) Primary care services defined.--In this subsection, the
term `primary care services'--
``(A) means services which are evaluation and
management services as defined in section
1848(j)(5)(A); and
``(B) includes services furnished by another health
care professional that would be described in
subparagraph (A) if furnished by a physician.
``(3) Primary care practitioner defined.--In this subsection,
the term `primary care practitioner'--
``(A) means a physician or other health care
practitioner (including a nurse practitioner) who--
``(i) specializes in family medicine, general
internal medicine, general pediatrics,
geriatrics, or obstetrics and gynecology; and
``(ii) has allowed charges for primary care
services that account for at least 50 percent
of the physician's or practitioner's total
allowed charges under section 1848, as
determined by the Secretary for the most recent
period for which data are available; and
``(B) includes a physician assistant who is under the
supervision of a physician described in subparagraph
(A).
``(4) Limitation on review.--There shall be no administrative
or judicial review under section 1869, section 1878, or
otherwise, respecting--
``(A) any determination or designation under this
subsection;
``(B) the identification of services as primary care
services under this subsection; and
``(C) the identification of a practitioner as a
primary care practitioner under this subsection.
``(5) Coordination with other payments.--
``(A) With other primary care incentives.--The
provisions of this subsection shall not be taken into
account in applying subsections (m) and (u) and any
payment under such subsections shall not be taken into
account in computing payments under this subsection.
``(B) With quality incentives.--Payments under this
subsection shall not be taken into account in
determining the amounts that would otherwise be paid
under this part for purposes of section
1834(g)(2)(B).''.
(b) Conforming Amendments.--
(1) Section 1833(m) of such Act (42 U.S.C. 1395l(m)) is
amended by redesignating paragraph (4) as paragraph (5) and by
inserting after paragraph (3) the following new paragraph:
``(4) The provisions of this subsection shall not be taken into
account in applying subsections (m) or (u) and any payment under such
subsections shall not be taken into account in computing payments under
this subsection.''.
(2) Section 1848(m)(5)(B) of such Act (42 U.S.C. 1395w-
4(m)(5)(B)) is amended by inserting ``, (p),'' after ``(m)''.
(3) Section 1848(o)(1)(B)(iv) of such Act (42 U.S.C. 1395w-
4(o)(1)(B)(iv)) is amended by inserting ``primary care'' before
``health professional shortage area''.
SEC. 1305. INCREASED REIMBURSEMENT RATE FOR CERTIFIED NURSE-MIDWIVES.
(a) In General.--Section 1833(a)(1)(K) of the Social Security Act (42
U.S.C.1395l(a)(1)(K)) is amended by striking ``(but in no event'' and
all that follows through ``performed by a physician)''.
(b) Effective Date.--The amendment made by subsection (a) shall apply
to services furnished on or after January 1, 2011.
SEC. 1306. COVERAGE AND WAIVER OF COST-SHARING FOR PREVENTIVE SERVICES.
(a) Medicare Covered Preventive Services Defined.--Section 1861 of
the Social Security Act (42 U.S.C. 1395x), as amended by section
1233(a), is amended by adding at the end the following new subsection:
``Medicare Covered Preventive Services
``(iii)(1) Subject to the succeeding provisions of this subsection,
the term `Medicare covered preventive services' means the following:
``(A) Prostate cancer screening tests (as defined in
subsection (oo)).
``(B) Colorectal cancer screening tests (as defined in
subsection (pp) and when applicable as described in section
1305).
``(C) Diabetes outpatient self-management training services
(as defined in subsection (qq)).
``(D) Screening for glaucoma for certain individuals (as
described in subsection (s)(2)(U)).
``(E) Medical nutrition therapy services for certain
individuals (as described in subsection (s)(2)(V)).
``(F) An initial preventive physical examination (as defined
in subsection (ww)).
``(G) Cardiovascular screening blood tests (as defined in
subsection (xx)(1)).
``(H) Diabetes screening tests (as defined in subsection
(yy)).
``(I) Ultrasound screening for abdominal aortic aneurysm for
certain individuals (as described in described in subsection
(s)(2)(AA)).
``(J) Pneumococcal and influenza vaccines and their
administration (as described in subsection (s)(10)(A)) and
hepatitis B vaccine and its administration for certain
individuals (as described in subsection (s)(10)(B)).
``(K) Screening mammography (as defined in subsection (jj)).
``(L) Screening pap smear and screening pelvic exam (as
defined in subsection (nn)).
``(M) Bone mass measurement (as defined in subsection (rr)).
``(N) Kidney disease education services (as defined in
subsection (ggg)).
``(O) Additional preventive services (as defined in
subsection (ddd)).
``(2) With respect to specific Medicare covered preventive services,
the limitations and conditions described in the provisions referenced
in paragraph (1) with respect to such services shall apply.''.
(b) Payment and Elimination of Cost-sharing.--
(1) In general.--
(A) In general.--Section 1833(a) of the Social
Security Act (42 U.S.C. 1395l(a)) is amended by adding
after and below paragraph (9) the following:
``With respect to Medicare covered preventive services, in any case in
which the payment rate otherwise provided under this part is computed
as a percent of less than 100 percent of an actual charge, fee schedule
rate, or other rate, such percentage shall be increased to 100
percent.''.
(B) Application to sigmoidoscopies and
colonoscopies.--Section 1834(d) of such Act (42 U.S.C.
1395m(d)) is amended--
(i) in paragraph (2)(C), by amending clause
(ii) to read as follows:
``(ii) No coinsurance.--In the case of a
beneficiary who receives services described in
clause (i), there shall be no coinsurance
applied.''; and
(ii) in paragraph (3)(C), by amending clause
(ii) to read as follows:
``(ii) No coinsurance.--In the case of a
beneficiary who receives services described in
clause (i), there shall be no coinsurance
applied.''.
(2) Elimination of coinsurance in outpatient hospital
settings.--
(A) Exclusion from opd fee schedule.--Section
1833(t)(1)(B)(iv) of the Social Security Act (42 U.S.C.
1395l(t)(1)(B)(iv)) is amended by striking ``screening
mammography (as defined in section 1861(jj)) and
diagnostic mammography'' and inserting ``diagnostic
mammograms and Medicare covered preventive services (as
defined in section 1861(iii)(1))''.
(B) Conforming amendments.--Section 1833(a)(2) of the
Social Security Act (42 U.S.C. 1395l(a)(2)) is
amended--
(i) in subparagraph (F), by striking ``and''
after the semicolon at the end;
(ii) in subparagraph (G), by adding ``and''
at the end; and
(iii) by adding at the end the following new
subparagraph:
``(H) with respect to additional preventive services
(as defined in section 1861(ddd)) furnished by an
outpatient department of a hospital, the amount
determined under paragraph (1)(W);''.
(3) Waiver of application of deductible for all preventive
services.--The first sentence of section 1833(b) of the Social
Security Act (42 U.S.C. 1395l(b)) is amended--
(A) in clause (1), by striking ``items and services
described in section 1861(s)(10)(A)'' and inserting
``Medicare covered preventive services (as defined in
section 1861(iii))''; and
(B) by striking clause (5) and all that follows
through ``(9)'' and inserting ``and (5)''.
(4) Application to providers of services.--Section
1866(a)(2)(A)(ii) of such Act (42 U.S.C. 1395cc(a)(2)(A)(ii))
is amended by inserting ``other than for Medicare covered
preventive services and'' after ``for such items and services
(''.
(c) Effective Date.--The amendments made by this section shall apply
to services furnished on or after January 1, 2011.
(d) Report to Congress on Barriers to Preventive Services.--Not later
than 12 months after the date of the enactment of this Act, the
Secretary of Health and Human Services shall report to Congress on
Medicare beneficiary barriers, such as physician referral requirements
or being a part of the Welcome to Medicare Physical Exam, to abdominal
aortic aneurysm screening and other preventative services as approved
by the U.S. Preventive Services Task Force. Furthermore, using existing
educational resources, the Secretary shall make educating patients and
physicians regarding the risk factors for an abdominal aortic aneurysm
and when beneficiaries should be screened, a priority.
SEC. 1307. WAIVER OF DEDUCTIBLE FOR COLORECTAL CANCER SCREENING TESTS
REGARDLESS OF CODING, SUBSEQUENT DIAGNOSIS, OR
ANCILLARY TISSUE REMOVAL.
(a) In General.--Section 1833(b) of the Social Security Act (42
U.S.C. 1395l(b)), as amended by section 1306(b)(3), is amended by
adding at the end the following new sentence: ``Clause (1) of the first
sentence of this subsection shall apply with respect to a colorectal
cancer screening test regardless of the code that is billed for the
establishment of a diagnosis as a result of the test, or for the
removal of tissue or other matter or other procedure that is furnished
in connection with, as a result of, and in the same clinical encounter
as, the screening test.''.
(b) Effective Date.--The amendment made by subsection (a) shall apply
to items and services furnished on or after January 1, 2011.
SEC. 1308. EXCLUDING CLINICAL SOCIAL WORKER SERVICES FROM COVERAGE
UNDER THE MEDICARE SKILLED NURSING FACILITY
PROSPECTIVE PAYMENT SYSTEM AND CONSOLIDATED
PAYMENT.
(a) In General.--Section 1888(e)(2)(A)(ii) of the Social Security Act
(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) of the Social Security
Act (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 July 1, 2010.
SEC. 1309. COVERAGE OF MARRIAGE AND FAMILY THERAPIST SERVICES AND
MENTAL HEALTH COUNSELOR SERVICES.
(a) Coverage of Marriage and Family Therapist Services.--
(1) Coverage of services.--Section 1861(s)(2) of the Social
Security Act (42 U.S.C. 1395x(s)(2)), as amended by section
1233, is amended--
(A) in subparagraph (EE), by striking ``and'' at the
end;
(B) in subparagraph (FF), by adding ``and'' at the
end; and
(C) by adding at the end the following new
subparagraph:
``(GG) marriage and family therapist services (as defined in
subsection (jjj));''.
(2) Definition.--Section 1861 of the Social Security Act (42
U.S.C. 1395x), as amended by sections 1233 and 1306, is amended
by adding at the end the following new subsection:
``Marriage and Family Therapist Services
``(jjj)(1) The term `marriage and family therapist services' means
services performed by a marriage and family therapist (as defined in
paragraph (2)) for the diagnosis and treatment of mental illnesses,
which the marriage and family therapist is legally authorized to
perform under State law (or the State regulatory mechanism provided by
State law) of the State in which such services are performed, as would
otherwise be covered if furnished by a physician or as incident to a
physician's professional service, but only if no facility or other
provider charges or is paid any amounts with respect to the furnishing
of such services.
``(2) The term `marriage and family therapist' means an individual
who--
``(A) possesses a master's or doctoral degree which qualifies
for licensure or certification as a marriage and family
therapist pursuant to State law;
``(B) after obtaining such degree has performed at least 2
years of clinical supervised experience in marriage and family
therapy; and
``(C) is licensed or certified as a marriage and family
therapist in the State in which marriage and family therapist
services are performed.''.
(3) Provision for payment under part b.--Section
1832(a)(2)(B) of the Social Security Act (42 U.S.C.
1395k(a)(2)(B)) is amended by adding at the end the following
new clause:
``(v) marriage and family therapist
services;''.
(4) Amount of payment.--
(A) In general.--Section 1833(a)(1) of the Social
Security Act (42 U.S.C. 1395l(a)(1)) is amended--
(i) by striking ``and'' before ``(W)''; and
(ii) by inserting before the semicolon at the
end the following: ``, and (X) with respect to
marriage and family therapist services under
section 1861(s)(2)(GG), the amounts paid shall
be 80 percent of the lesser of the actual
charge for the services or 75 percent of the
amount determined for payment of a psychologist
under clause (L)''.
(B) Development of criteria with respect to
consultation with a health care professional.--The
Secretary of Health and Human Services shall, taking
into consideration concerns for patient
confidentiality, develop criteria with respect to
payment for marriage and family therapist services for
which payment may be made directly to the marriage and
family therapist under part B of title XVIII of the
Social Security Act (42 U.S.C. 1395j et seq.) under
which such a therapist must agree to consult with a
patient's attending or primary care physician or nurse
practitioner in accordance with such criteria.
(5) Exclusion of marriage and family therapist services from
skilled nursing facility prospective payment system.--Section
1888(e)(2)(A)(ii) of the Social Security Act (42 U.S.C.
1395yy(e)(2)(A)(ii)), as amended by section 1308(a), is amended
by inserting ``marriage and family therapist services (as
defined in subsection (jjj)(1)),'' after ``clinical social
worker services,''.
(6) Coverage of marriage and family therapist services
provided in rural health clinics and federally qualified health
centers.--Section 1861(aa)(1)(B) of the Social Security Act (42
U.S.C. 1395x(aa)(1)(B)) is amended by striking ``or by a
clinical social worker (as defined in subsection (hh)(1)),''
and inserting ``, by a clinical social worker (as defined in
subsection (hh)(1)), or by a marriage and family therapist (as
defined in subsection (jjj)(2)),''.
(7) Inclusion of marriage and family therapists as
practitioners for assignment of claims.--Section 1842(b)(18)(C)
of the Social Security Act (42 U.S.C. 1395u(b)(18)(C)) is
amended by adding at the end the following new clause:
``(vii) A marriage and family therapist (as defined in
section 1861(jjj)(2)).''.
(b) Coverage of Mental Health Counselor Services.--
(1) Coverage of services.--Section 1861(s)(2) of the Social
Security Act (42 U.S.C. 1395x(s)(2)), as previously amended, is
further amended--
(A) in subparagraph (FF), by striking ``and'' at the
end;
(B) in subparagraph (GG), by inserting ``and'' at the
end; and
(C) by adding at the end the following new
subparagraph:
``(HH) mental health counselor services (as defined in
subsection (kkk)(1));''.
(2) Definition.--Section 1861 of the Social Security Act (42
U.S.C. 1395x), as previously amended, is amended by adding at
the end the following new subsection:
``Mental Health Counselor Services
``(kkk)(1) The term `mental health counselor services' means services
performed by a mental health counselor (as defined in paragraph (2))
for the diagnosis and treatment of mental illnesses which the mental
health counselor is legally authorized to perform under State law (or
the State regulatory mechanism provided by the State law) of the State
in which such services are performed, as would otherwise be covered if
furnished by a physician or as incident to a physician's professional
service, but only if no facility or other provider charges or is paid
any amounts with respect to the furnishing of such services.
``(2) The term `mental health counselor' means an individual who--
``(A) possesses a master's or doctor's degree which qualifies
the individual for licensure or certification for the practice
of mental health counseling in the State in which the services
are performed;
``(B) after obtaining such a degree has performed at least 2
years of supervised mental health counselor practice; and
``(C) is licensed or certified as a mental health counselor
or professional counselor by the State in which the services
are performed.''.
(3) Provision for payment under part b.--Section
1832(a)(2)(B) of the Social Security Act (42 U.S.C.
1395k(a)(2)(B)), as amended by subsection (a)(3), is further
amended--
(A) by striking ``and'' at the end of clause (iv);
(B) by adding ``and'' at the end of clause (v); and
(C) by adding at the end the following new clause:
``(vi) mental health counselor services;
and''.
(4) Amount of payment.--
(A) In general.--Section 1833(a)(1) of the Social
Security Act (42 U.S.C. 1395l(a)(1)), as amended by
subsection (a), is further amended--
(i) by striking ``and'' before ``(X)''; and
(ii) by inserting before the semicolon at the
end the following: ``, and (Y) with respect to
mental health counselor services under section
1861(s)(2)(HH), the amounts paid shall be 80
percent of the lesser of the actual charge for
the services or 75 percent of the amount
determined for payment of a psychologist under
clause (L)''.
(B) Development of criteria with respect to
consultation with a physician.--The Secretary of Health
and Human Services shall, taking into consideration
concerns for patient confidentiality, develop criteria
with respect to payment for mental health counselor
services for which payment may be made directly to the
mental health counselor under part B of title XVIII of
the Social Security Act (42 U.S.C. 1395j et seq.) under
which such a counselor must agree to consult with a
patient's attending or primary care physician in
accordance with such criteria.
(5) Exclusion of mental health counselor services from
skilled nursing facility prospective payment system.--Section
1888(e)(2)(A)(ii) of the Social Security Act (42 U.S.C.
1395yy(e)(2)(A)(ii)), as amended by section 1308(a) and
subsection (a), is amended by inserting ``mental health
counselor services (as defined in section 1861(kkk)(1)),''
after ``marriage and family therapist services (as defined in
subsection (jjj)(1)),''.
(6) Coverage of mental health counselor services provided in
rural health clinics and federally qualified health centers.--
Section 1861(aa)(1)(B) of the Social Security Act (42 U.S.C.
1395x(aa)(1)(B)), as amended by subsection (a), is amended by
striking ``or by a marriage and family therapist (as defined in
subsection (jjj)(2)),'' and inserting ``by a marriage and
family therapist (as defined in subsection (jjj)(2)), or a
mental health counselor (as defined in subsection (kkk)(2)),''.
(7) Inclusion of mental health counselors as practitioners
for assignment of claims.--Section 1842(b)(18)(C) of the Social
Security Act (42 U.S.C. 1395u(b)(18)(C)), as amended by
subsection (a)(7), is amended by adding at the end the
following new clause:
``(viii) A mental health counselor (as defined in section
1861(kkk)(2)).''.
(c) Effective Date.--The amendments made by this section shall apply
to items and services furnished on or after January 1, 2011.
SEC. 1310. EXTENSION OF PHYSICIAN FEE SCHEDULE MENTAL HEALTH ADD-ON.
Section 138(a)(1) of the Medicare Improvements for Patients and
Providers Act of 2008 (Public Law 110-275) is amended by striking
``December 31, 2009'' and inserting ``December 31, 2011''.
SEC. 1311. EXPANDING ACCESS TO VACCINES.
(a) In General.--Paragraph (10) of section 1861(s) of the Social
Security Act (42 U.S.C. 1395w(s)) is amended to read as follows:
``(10) federally recommended vaccines (as defined in
subsection (lll)) and their respective administration;''.
(b) Federally Recommended Vaccines Defined.--Section 1861 of such
Act, as previously amended, is further amended by adding at the end the
following new subsection:
``Federally Recommended Vaccines
``(lll) The term `federally recommended vaccine' means an approved
vaccine recommended by the Advisory Committee on Immunization Practices
(an advisory committee established by the Secretary, acting through the
Director of the Centers for Disease Control and Prevention).''.
(c) Conforming Amendments.--
(1) Section 1833 of such Act (42 U.S.C. 1395l) is amended, in
each of subsections (a)(1)(B), (a)(2)(G), (a)(3)(A), by
striking ``1861(s)(10)(A)'' and inserting ``1861(s)(10)'' each
place it appears.
(2) Section 1842(o)(1)(A)(iv) of such Act (42 U.S.C.
1395u(o)(1)(A)(iv)) is amended--
(A) by striking ``subparagraph (A) or (B) of''; and
(B) by inserting before the period the following:
``and before January 1, 2011, and influenza vaccines
furnished on or after January 1, 2011''.
(3) Section 1847A(c)(6) of such Act (42 U.S.C. 1395w-
3a(c)(6)) is amended by striking subparagraph (G) and inserting
the following:
``(G) Implementation.--Chapter 35 of title 44, United
States Code shall not apply to manufacturer provision
of information pursuant to section 1927(b)(3)(A)(iii)
for purposes of implementation of this section.''.
(4) Section 1860D-2(e)(1) of such Act (42 U.S.C. 1395w-
102(e)(1)) is amended by striking ``such term includes a
vaccine'' and all that follows through ``its administration)
and''.
(5) Section 1861(ww)(2)(A) of such Act (42 U.S.C.
1395x(ww)(2)(A))) is amended by striking ``Pneumococcal,
influenza, and hepatitis B vaccine and administration'' and
inserting ``Federally recommended vaccines (as defined in
subsection (lll)) and their respective administration''.
(6) Section 1861(iii)(1) of such Act, as added by section
1306(a), is amended by amending subparagraph (J) to read as
follows:
``(J) Federally recommended vaccines (as defined in
subsection (lll)) and their respective administration.''.
(7) Section 1927(b)(3)(A)(iii) of such Act (42 U.S.C. 1396r-
8(b)(3)(A)(iii)) is amended, in the matter following subclause
(III), by inserting ``(A)(iv) (including influenza vaccines
furnished on or after January 1, 2011),'' after ``described in
subparagraph''
(d) Effective Dates.--The amendments made by--
(1) this section (other than by subsection (c)(7)) shall
apply to vaccines administered on or after January 1, 2011; and
(2) by subsection (c)(7) shall apply to calendar quarters
beginning on or after January 1, 2010.
SEC. 1312. RECOGNITION OF CERTIFIED DIABETES EDUCATORS AS CERTIFIED
PROVIDERS FOR PURPOSES OF MEDICARE DIABETES
OUTPATIENT SELF-MANAGEMENT TRAINING SERVICES.
(a) In General.--Section 1861(qq) of the Social Security Act (42
U.S.C. 1395x(qq)) is amended--
(1) in paragraph (1), by inserting ``or by a certified
diabetes educator (as defined in paragraph (3))'' after
``paragraph (2)(B)''; and
(2) by adding at the end the following new paragraphs:
``(3) For purposes of paragraph (1), the term `certified
diabetes educator' means an individual who--
``(A) is licensed or registered by the State in which
the services are performed as a health care
professional;
``(B) specializes in teaching individuals with
diabetes to develop the necessary skills and knowledge
to manage the individual's diabetic condition; and
``(C) is certified as a diabetes educator by a
recognized certifying body (as defined in paragraph
(4)).
``(4)(A) For purposes of paragraph (3)(C), the term
`recognized certifying body' means--
``(i) the National Certification Board for Diabetes
Educators, or
``(ii) a certifying body for diabetes educators,
which is recognized by the Secretary as authorized to
grant certification of diabetes educators for purposes
of this subsection pursuant to standards established by
the Secretary, if the Secretary determines such Board
or body, respectively, meets the requirement of
subparagraph (B).
``(B) The National Certification Board for Diabetes Educators
or a certifying body for diabetes educators meets the
requirement of this subparagraph, with respect to the
certification of an individual, if the Board or body,
respectively, is incorporated and registered to do business in
the United States and requires as a condition of such
certification each of the following:
``(i) The individual has a qualifying credential in a
specified health care profession.
``(ii) The individual has professional practice
experience in diabetes self-management training that
includes a minimum number of hours and years of
experience in such training.
``(iii) The individual has successfully completed a
national certification examination offered by such
entity.
``(iv) The individual periodically renews
certification status following initial
certification.''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to diabetes outpatient self-management training services
furnished on or after the first day of the first calendar year that is
at least 6 months after the date of the enactment of this Act.
TITLE IV--QUALITY
Subtitle A--Comparative Effectiveness Research
SEC. 1401. COMPARATIVE EFFECTIVENESS RESEARCH.
(a) In General.--Title XI of the Social Security Act is amended by
adding at the end the following new part:
``Part D--Comparative Effectiveness Research
``comparative effectiveness research
``Sec. 1181. (a) Center for Comparative Effectiveness Research
Established.--
``(1) In general.--The Secretary shall establish within the
Agency for Healthcare Research and Quality a Center for
Comparative Effectiveness Research (in this section referred to
as the `Center') to conduct, support, and synthesize research
(including research conducted or supported under section 1013
of the Medicare Prescription Drug, Improvement, and
Modernization Act of 2003) with respect to the outcomes,
effectiveness, and appropriateness of health care services and
procedures in order to identify the manner in which diseases,
disorders, and other health conditions can most effectively and
appropriately be prevented, diagnosed, treated, and managed
clinically.
``(2) Duties.--The Center shall--
``(A) conduct, support, and synthesize research
relevant to the comparative effectiveness of the full
spectrum of health care items, services and systems,
including pharmaceuticals, medical devices, medical and
surgical procedures, and other medical interventions;
``(B) conduct and support systematic reviews of
clinical research, including original research
conducted subsequent to the date of the enactment of
this section;
``(C) continuously develop rigorous scientific
methodologies for conducting comparative effectiveness
studies, and use such methodologies appropriately;
``(D) submit to the Comparative Effectiveness
Research Commission, the Secretary, and Congress
appropriate relevant reports described in subsection
(d)(2); and
``(E) encourage, as appropriate, the development and
use of clinical registries and the development of
clinical effectiveness research data networks from
electronic health records, post marketing drug and
medical device surveillance efforts, and other forms of
electronic health data.
``(3) Powers.--
``(A) Obtaining official data.--The Center may secure
directly from any department or agency of the United
States information necessary to enable it to carry out
this section. Upon request of the Center, the head of
that department or agency shall furnish that
information to the Center on an agreed upon schedule.
``(B) Data collection.--In order to carry out its
functions, the Center shall--
``(i) utilize existing information, both
published and unpublished, where possible,
collected and assessed either by its own staff
or under other arrangements made in accordance
with this section,
``(ii) carry out, or award grants or
contracts for, original research and
experimentation, where existing information is
inadequate, and
``(iii) adopt procedures allowing any
interested party to submit information for the
use by the Center and Commission under
subsection (b) in making reports and
recommendations.
``(C) Access of gao to information.--The Comptroller
General shall have unrestricted access to all
deliberations, records, and nonproprietary data of the
Center and Commission under subsection (b), immediately
upon request.
``(D) Periodic audit.--The Center and Commission
under subsection (b) shall be subject to periodic audit
by the Comptroller General.
``(b) Oversight by Comparative Effectiveness Research Commission.--
``(1) In general.--The Secretary shall establish an
independent Comparative Effectiveness Research Commission (in
this section referred to as the `Commission') to oversee and
evaluate the activities carried out by the Center under
subsection (a), subject to the authority of the Secretary, to
ensure such activities result in highly credible research and
information resulting from such research.
``(2) Duties.--The Commission shall--
``(A) determine national priorities for research
described in subsection (a) and in making such
determinations consult with a broad array of public and
private stakeholders, including patients and health
care providers and payers;
``(B) monitor the appropriateness of use of the CERTF
described in subsection (g) with respect to the timely
production of comparative effectiveness research
determined to be a national priority under subparagraph
(A);
``(C) identify highly credible research methods and
standards of evidence for such research to be
considered by the Center;
``(D) review the methodologies developed by the
center under subsection (a)(2)(C);
``(E) not later than one year after the date of the
enactment of this section, enter into an arrangement
under which the Institute of Medicine of the National
Academy of Sciences shall conduct an evaluation and
report on standards of evidence for such research;
``(F) support forums to increase stakeholder
awareness and permit stakeholder feedback on the
efforts of the Center to advance methods and standards
that promote highly credible research;
``(G) make recommendations for policies that would
allow for public access of data produced under this
section, in accordance with appropriate privacy and
proprietary practices, while ensuring that the
information produced through such data is timely and
credible;
``(H) appoint a clinical perspective advisory panel
for each research priority determined under
subparagraph (A), which shall consult with patients and
advise the Center on research questions, methods, and
evidence gaps in terms of clinical outcomes for the
specific research inquiry to be examined with respect
to such priority to ensure that the information
produced from such research is clinically relevant to
decisions made by clinicians and patients at the point
of care;
``(I) make recommendations for the priority for
periodic reviews of previous comparative effectiveness
research and studies conducted by the Center under
subsection (a);
``(J) routinely review processes of the Center with
respect to such research to confirm that the
information produced by such research is objective,
credible, consistent with standards of evidence
established under this section, and developed through a
transparent process that includes consultations with
appropriate stakeholders; and
``(K) make recommendations to the center for the
broad dissemination of the findings of research
conducted and supported under this section that enables
clinicians, patients, consumers, and payers to make
more informed health care decisions that improve
quality and value.
``(3) Composition of commission.--
``(A) In general.--The members of the Commission
shall consist of--
``(i) the Director of the Agency for
Healthcare Research and Quality;
``(ii) the Chief Medical Officer of the
Centers for Medicare & Medicaid Services; and
``(iii) 15 additional members who shall
represent broad constituencies of stakeholders
including clinicians, patients, researchers,
third-party payers, consumers of Federal and
State beneficiary programs.
Of such members, at least 9 shall be practicing
physicians, health care practitioners, consumers, or
patients.
``(B) Qualifications.--
``(i) Diverse representation of
perspectives.--The members of the Commission
shall represent a broad range of perspectives
and shall collectively have experience in the
following areas:
``(I) Epidemiology.
``(II) Health services research.
``(III) Bioethics.
``(IV) Decision sciences.
``(V) Health disparities.
``(VI) Economics.
``(ii) Diverse representation of health care
community.--At least one member shall represent
each of the following health care communities:
``(I) Patients.
``(II) Health care consumers.
``(III) Practicing Physicians,
including surgeons.
``(IV) Other health care
practitioners engaged in clinical care.
``(V) Employers.
``(VI) Public payers.
``(VII) Insurance plans.
``(VIII) Clinical researchers who
conduct research on behalf of
pharmaceutical or device manufacturers.
``(C) Limitation.--No more than 3 of the Members of
the Commission may be representatives of pharmaceutical
or device manufacturers and such representatives shall
be clinical researchers described under subparagraph
(B)(ii)(VIII).
``(4) Appointment.--
``(A) In general.--The Secretary shall appoint the
members of the Commission.
``(B) Consultation.--In considering candidates for
appointment to the Commission, the Secretary may
consult with the Government Accountability Office and
the Institute of Medicine of the National Academy of
Sciences.
``(5) Chairman; vice chairman.--The Secretary shall designate
a member of the Commission, at the time of appointment of the
member, as Chairman and a member as Vice Chairman for that term
of appointment, except that in the case of vacancy of the
Chairmanship or Vice Chairmanship, the Secretary may designate
another member for the remainder of that member's term. The
Chairman shall serve as an ex officio member of the National
Advisory Council of the Agency for Health Care Research and
Quality under section 931(c)(3)(B) of the Public Health Service
Act.
``(6) Terms.--
``(A) In general.--Except as provided in subparagraph
(B), each member of the Commission shall be appointed
for a term of 4 years.
``(B) Terms of initial appointees.--Of the members
first appointed--
``(i) 8 shall be appointed for a term of 4
years; and
``(ii) 7 shall be appointed for a term of 3
years.
``(7) Coordination.--To enhance effectiveness and
coordination, the Secretary is encouraged, to the greatest
extent possible, to seek coordination between the Commission
and the National Advisory Council of the Agency for Healthcare
Research and Quality.
``(8) Conflicts of interest.--
``(A) In general.--In appointing the members of the
Commission or a clinical perspective advisory panel
described in paragraph (2)(H), the Secretary or the
Commission, respectively, shall take into consideration
any financial interest (as defined in subparagraph
(D)), consistent with this paragraph, and develop a
plan for managing any identified conflicts.
``(B) Evaluation and criteria.--When considering an
appointment to the Commission or a clinical perspective
advisory panel described paragraph (2)(H) the Secretary
or the Commission shall review the expertise of the
individual and the financial disclosure report filed by
the individual pursuant to the Ethics in Government Act
of 1978 for each individual under consideration for the
appointment, so as to reduce the likelihood that an
appointed individual will later require a written
determination as referred to in section 208(b)(1) of
title 18, United States Code, a written certification
as referred to in section 208(b)(3) of title 18, United
States Code, or a waiver as referred to in subparagraph
(D)(iii) for service on the Commission at a meeting of
the Commission.
``(C) Disclosures; prohibitions on participation;
waivers.--
``(i) Disclosure of financial interest.--
Prior to a meeting of the Commission or a
clinical perspective advisory panel described
in paragraph (2)(H) regarding a `particular
matter' (as that term is used in section 208 of
title 18, United States Code), each member of
the Commission or the clinical perspective
advisory panel who is a full-time Government
employee or special Government employee shall
disclose to the Secretary financial interests
in accordance with subsection (b) of such
section 208.
``(ii) Prohibitions on participation.--Except
as provided under clause (iii), a member of the
Commission or a clinical perspective advisory
panel described in paragraph (2)(H) may not
participate with respect to a particular matter
considered in meeting of the Commission or the
clinical perspective advisory panel if such
member (or an immediate family member of such
member) has a financial interest that could be
affected by the advice given to the Secretary
with respect to such matter, excluding
interests exempted in regulations issued by the
Director of the Office of Government Ethics as
too remote or inconsequential to affect the
integrity of the services of the Government
officers or employees to which such regulations
apply.
``(iii) Waiver.--If the Secretary determines
it necessary to afford the Commission or a
clinical perspective advisory panel described
in paragraph 2(H) essential expertise, the
Secretary may grant a waiver of the prohibition
in clause (ii) to permit a member described in
such subparagraph to--
``(I) participate as a non-voting
member with respect to a particular
matter considered in a Commission or a
clinical perspective advisory panel
meeting; or
``(II) participate as a voting member
with respect to a particular matter
considered in a Commission or a
clinical perspective advisory panel
meeting.
``(iv) Limitation on waivers and other
exceptions.--
``(I) Determination of allowable
exceptions for the commission.--The
number of waivers granted to members of
the Commission cannot exceed one-half
of the total number of members for the
Commission.
``(II) Prohibition on voting status
on clinical perspective advisory
panels.--No voting member of any
clinical perspective advisory panel
shall be in receipt of a waiver. No
more than two nonvoting members of any
clinical perspective advisory panel
shall receive a waiver.
``(D) Financial interest defined.--For purposes of
this paragraph, the term `financial interest' means a
financial interest under section 208(a) of title 18,
United States Code.
``(9) Compensation.--While serving on the business of the
Commission (including travel time), a member of the Commission
shall be entitled to compensation at the per diem equivalent of
the rate provided for level IV of the Executive Schedule under
section 5315 of title 5, United States Code; and while so
serving away from home and the member's regular place of
business, a member may be allowed travel expenses, as
authorized by the Director of the Commission.
``(10) Availability of reports.--The Commission shall
transmit to the Secretary a copy of each report submitted under
this subsection and shall make such reports available to the
public.
``(11) Director and staff; experts and consultants.--Subject
to such review as the Secretary deems necessary to assure the
efficient administration of the Commission, the Commission
may--
``(A) appoint an Executive Director (subject to the
approval of the Secretary) and such other personnel as
Federal employees under section 2105 of title 5, United
States Code, as may be necessary to carry out its
duties (without regard to the provisions of title 5,
United States Code, governing appointments in the
competitive service);
``(B) seek such assistance and support as may be
required in the performance of its duties from
appropriate Federal departments and agencies;
``(C) enter into contracts or make other
arrangements, as may be necessary for the conduct of
the work of the Commission (without regard to section
3709 of the Revised Statutes (41 U.S.C. 5));
``(D) make advance, progress, and other payments
which relate to the work of the Commission;
``(E) provide transportation and subsistence for
persons serving without compensation; and
``(F) prescribe such rules and regulations as it
deems necessary with respect to the internal
organization and operation of the Commission.
``(c) Research Requirements.--Any research conducted, supported, or
synthesized under this section shall meet the following requirements:
``(1) Ensuring transparency, credibility, and access.--
``(A) The establishment of the agenda and conduct of
the research shall be insulated from inappropriate
political or stakeholder influence.
``(B) Methods of conducting such research shall be
scientifically based.
``(C) All aspects of the prioritization of research,
conduct of the research, and development of conclusions
based on the research shall be transparent to all
stakeholders.
``(D) The process and methods for conducting such
research shall be publicly documented and available to
all stakeholders.
``(E) Throughout the process of such research, the
Center shall provide opportunities for all stakeholders
involved to review and provide public comment on the
methods and findings of such research.
``(2) Use of clinical perspective advisory panels.--The
research shall meet a national research priority determined
under subsection (b)(2)(A) and shall consider advice given to
the Center by the clinical perspective advisory panel for the
national research priority.
``(3) Stakeholder input.--
``(A) In general.--The Commission shall consult with
patients, health care providers, health care consumer
representatives, and other appropriate stakeholders
with an interest in the research through a transparent
process recommended by the Commission.
``(B) Specific areas of consultation.--Consultation
shall include where deemed appropriate by the
Commission--
``(i) recommending research priorities and
questions;
``(ii) recommending research methodologies;
and
``(iii) advising on and assisting with
efforts to disseminate research findings.
``(C) Ombudsman.--The Secretary shall designate a
patient ombudsman. The ombudsman shall--
``(i) serve as an available point of contact
for any patients with an interest in proposed
comparative effectiveness studies by the
Center; and
``(ii) ensure that any comments from patients
regarding proposed comparative effectiveness
studies are reviewed by the Commission.
``(4) Taking into account potential differences.--Research
shall--
``(A) be designed, as appropriate, to take into
account the potential for differences in the
effectiveness of health care items and services used
with various subpopulations such as racial and ethnic
minorities, women, different age groups (including
children, adolescents, adults, and seniors), and
individuals with different comorbidities; and--
``(B) seek, as feasible and appropriate, to include
members of such subpopulations as subjects in the
research.
``(d) Public Access to Comparative Effectiveness Information.--
``(1) In general.--Not later than 90 days after receipt by
the Center or Commission, as applicable, of a relevant report
described in paragraph (2) made by the Center, Commission, or
clinical perspective advisory panel under this section,
appropriate information contained in such report shall be
posted on the official public Internet site of the Center and
of the Commission, as applicable.
``(2) Relevant reports described.--For purposes of this
section, a relevant report is each of the following submitted
by the Center or a grantee or contractor of the Center:
``(A) Any interim or progress reports as deemed
appropriate by the Secretary.
``(B) Stakeholder comments.
``(C) A final report.
``(e) Dissemination and Incorporation of Comparative Effectiveness
Information.--
``(1) Dissemination.--The Center shall provide for the
dissemination of appropriate findings produced by research
supported, conducted, or synthesized under this section to
health care providers, patients, vendors of health information
technology focused on clinical decision support, appropriate
professional associations, and Federal and private health
plans, and other relevant stakeholders. In disseminating such
findings the Center shall--
``(A) convey findings of research so that they are
comprehensible and useful to patients and providers in
making health care decisions;
``(B) discuss findings and other considerations
specific to certain sub-populations, risk factors, and
comorbidities as appropriate;
``(C) include considerations such as limitations of
research and what further research may be needed, as
appropriate;
``(D) not include any data that the dissemination of
which would violate the privacy of research
participants or violate any confidentiality agreements
made with respect to the use of data under this
section; and
``(E) assist the users of health information
technology focused on clinical decision support to
promote the timely incorporation of such findings into
clinical practices and promote the ease of use of such
incorporation.
``(2) Dissemination protocols and strategies.--The Center
shall develop protocols and strategies for the appropriate
dissemination of research findings in order to ensure effective
communication of findings and the use and incorporation of such
findings into relevant activities for the purpose of informing
higher quality and more effective and efficient decisions
regarding medical items and services. In developing and
adopting such protocols and strategies, the Center shall
consult with stakeholders concerning the types of dissemination
that will be most useful to the end users of information and
may provide for the utilization of multiple formats for
conveying findings to different audiences, including
dissemination to individuals with limited English proficiency.
``(f) Reports to Congress.--
``(1) Annual reports.--Beginning not later than one year
after the date of the enactment of this section, the Director
of the Agency of Healthcare Research and Quality and the
Commission shall submit to Congress an annual report on the
activities of the Center and the Commission, as well as the
research, conducted under this section. Each such report shall
include a discussion of the Center's compliance with subsection
(c)(4)(B), including any reasons for lack of complicance with
such subsection.
``(2) Recommendation for fair share per capita amount for
all-payer financing.--Beginning not later than December 31,
2011, the Secretary shall submit to Congress an annual
recommendation for a fair share per capita amount described in
subsection (c)(1) of section 9511 of the Internal Revenue Code
of 1986 for purposes of funding the CERTF under such section.
``(3) Analysis and review.--Not later than December 31, 2013,
the Secretary, in consultation with the Commission, shall
submit to Congress a report on all activities conducted or
supported under this section as of such date. Such report shall
include an evaluation of the overall costs of such activities
and an analysis of the backlog of any research proposals
approved by the Commission but not funded.
``(g) Funding of Comparative Effectiveness Research.--For fiscal year
2010 and each subsequent fiscal year, amounts in the Comparative
Effectiveness Research Trust Fund (referred to in this section as the
`CERTF') under section 9511 of the Internal Revenue Code of 1986 shall
be available, without the need for further appropriations and without
fiscal year limitation, to the Secretary to carry out this section.
``(h) Construction.--Nothing in this section shall be construed to
permit the Commission or the Center to mandate coverage, reimbursement,
or other policies for any public or private payer.
``(i) Research Not To Be Used To Deny or Ration Care.--In no case may
any research conducted, supported, or developed by the Center, the
Commission, or the Federal Coordinating Council for Comparative
Effectiveness Research be used by the federal government to deny or
ration care.
``(j) Application of Federally Funded Clinical Comparative
Effectiveness Research.--The Centers for Medicare & Medicaid Services
may not use Federally funded clinical comparative effectiveness
research data under this section to make coverage determinations for
medical treatments, services, or items under title XVIII on the basis
of cost.
``(k) Conditions on Recommendations of Standards or Protocols.--
``(1) In general.--The work performed by the Commission or
the Center shall be based upon consultation with, and review
by, the specialty colleges and academies of medicine to
determine best practices within their field of specialty. Any
recommendations made or best practices developed by the
Commission or the Center --
``(A) shall be based upon evidence-based medicine;
and
``(B) shall not violate standards and protocols of
clinical excellence of the specialty colleges and
academies.
``(2) Definitions.--For purposes of this subsection:
``(A) Specialty colleges and academies of medicine.--
The term `specialty colleges and academies of medicine'
means the trade associations and professional
membership societies that represent physicians based on
the field of medicine in which each such physician
practices or is board certified.
``(B) Standards and protocols of clinical
excellence.--The term `standards and protocols of
clinical excellence' means clinical or practice
guidelines that consist of a set of directions or
principles that is based on evidence and is designed to
assist a health care practitioner with decisions about
appropriate diagnostic, therapeutic, or other clinical
procedures for specific clinical circumstances.''.
(b) Comparative Effectiveness Research Trust Fund; Financing for the
Trust Fund.--For provision establishing a Comparative Effectiveness
Research Trust Fund and financing such Trust Fund, see section 1802.
Subtitle B--Nursing Home Transparency
PART 1--IMPROVING TRANSPARENCY OF INFORMATION ON SKILLED NURSING
FACILITIES AND NURSING FACILITIES
SEC. 1411. REQUIRED DISCLOSURE OF OWNERSHIP AND ADDITIONAL DISCLOSABLE
PARTIES INFORMATION.
(a) In General.--Section 1124 of the Social Security Act (42 U.S.C.
1320a-3) is amended by adding at the end the following new subsection:
``(c) Required Disclosure of Ownership and Additional Disclosable
Parties Information.--
``(1) Disclosure.--A facility (as defined in paragraph
(7)(B)) shall have the information described in paragraph (3)
available--
``(A) during the period beginning on the date of the
enactment of this subsection and ending on the date
such information is made available to the public under
section 1411(b) of the America's Affordable Health
Choices Act of 2009, for submission to the Secretary,
the Inspector General of the Department of Health and
Human Services, the State in which the facility is
located, and the State long-term care ombudsman in the
case where the Secretary, the Inspector General, the
State, or the State long-term care ombudsman requests
such information; and
``(B) beginning on the effective date of the final
regulations promulgated under paragraph (4)(A), for
reporting such information in accordance with such
final regulations.
Nothing in subparagraph (A) shall be construed as authorizing a
facility to dispose of or delete information described in such
subparagraph after the effective date of the final regulations
promulgated under paragraph (4)(A).
``(2) Public availability of information.--During the period
described in paragraph (1)(A), a facility shall--
``(A) make the information described in paragraph (3)
available to the public upon request and update such
information as may be necessary to reflect changes in
such information; and
``(B) post a notice of the availability of such
information in the lobby of the facility in a prominent
manner.
``(3) Information described.--
``(A) In general.--The following information is
described in this paragraph:
``(i) The information described in
subsections (a) and (b), subject to
subparagraph (C).
``(ii) The identity of and information on--
``(I) each member of the governing
body of the facility, including the
name, title, and period of service of
each such member;
``(II) each person or entity who is
an officer, director, member, partner,
trustee, or managing employee of the
facility, including the name, title,
and date of start of service of each
such person or entity; and
``(III) each person or entity who is
an additional disclosable party of the
facility.
``(iii) The organizational structure of each
person and entity described in subclauses (II)
and (III) of clause (ii) and a description of
the relationship of each such person or entity
to the facility and to one another.
``(B) Special rule where information is already
reported or submitted.--To the extent that information
reported by a facility to the Internal Revenue Service
on Form 990, information submitted by a facility to the
Securities and Exchange Commission, or information
otherwise submitted to the Secretary or any other
Federal agency contains the information described in
clauses (i), (ii), or (iii) of subparagraph (A), the
Secretary may allow, to the extent practicable, such
Form or such information to meet the requirements of
paragraph (1) and to be submitted in a manner specified
by the Secretary.
``(C) Special rule.--In applying subparagraph
(A)(i)--
``(i) with respect to subsections (a) and
(b), `ownership or control interest' shall
include direct or indirect interests, including
such interests in intermediate entities; and
``(ii) subsection (a)(3)(A)(ii) shall include
the owner of a whole or part interest in any
mortgage, deed of trust, note, or other
obligation secured, in whole or in part, by the
entity or any of the property or assets
thereof, if the interest is equal to or exceeds
5 percent of the total property or assets of
the entirety.
``(4) Reporting.--
``(A) In general.--Not later than the date that is 2
years after the date of the enactment of this
subsection, the Secretary shall promulgate regulations
requiring, effective on the date that is 90 days after
the date on which such final regulations are published
in the Federal Register, a facility to report the
information described in paragraph (3) to the Secretary
in a standardized format, and such other regulations as
are necessary to carry out this subsection. Such final
regulations shall ensure that the facility certifies,
as a condition of participation and payment under the
program under title XVIII or XIX, that the information
reported by the facility in accordance with such final
regulations is accurate and current.
``(B) Guidance.--The Secretary shall provide guidance
and technical assistance to States on how to adopt the
standardized format under subparagraph (A).
``(5) No effect on existing reporting requirements.--Nothing
in this subsection shall reduce, diminish, or alter any
reporting requirement for a facility that is in effect as of
the date of the enactment of this subsection.
``(6) Definitions.--In this subsection:
``(A) Additional disclosable party.--The term
`additional disclosable party' means, with respect to a
facility, any person or entity who--
``(i) exercises operational, financial, or
managerial control over the facility or a part
thereof, or provides policies or procedures for
any of the operations of the facility, or
provides financial or cash management services
to the facility;
``(ii) leases or subleases real property to
the facility, or owns a whole or part interest
equal to or exceeding 5 percent of the total
value of such real property;
``(iii) lends funds or provides a financial
guarantee to the facility in an amount which is
equal to or exceeds $50,000; or
``(iv) provides management or administrative
services, clinical consulting services, or
accounting or financial services to the
facility.
``(B) Facility.--The term `facility' means a
disclosing entity which is--
``(i) a skilled nursing facility (as defined
in section 1819(a)); or
``(ii) a nursing facility (as defined in
section 1919(a)).
``(C) Managing employee.--The term `managing
employee' means, with respect to a facility, an
individual (including a general manager, business
manager, administrator, director, or consultant) who
directly or indirectly manages, advises, or supervises
any element of the practices, finances, or operations
of the facility.
``(D) Organizational structure.--The term
`organizational structure' means, in the case of--
``(i) a corporation, the officers, directors,
and shareholders of the corporation who have an
ownership interest in the corporation which is
equal to or exceeds 5 percent;
``(ii) a limited liability company, the
members and managers of the limited liability
company (including, as applicable, what
percentage each member and manager has of the
ownership interest in the limited liability
company);
``(iii) a general partnership, the partners
of the general partnership;
``(iv) a limited partnership, the general
partners and any limited partners of the
limited partnership who have an ownership
interest in the limited partnership which is
equal to or exceeds 10 percent;
``(v) a trust, the trustees of the trust;
``(vi) an individual, contact information for
the individual; and
``(vii) any other person or entity, such
information as the Secretary determines
appropriate.''.
(b) Public Availability of Information.--
(1) In general.--Not later than the date that is 1 year after
the date on which the final regulations promulgated under
section 1124(c)(4)(A) of the Social Security Act, as added by
subsection (a), are published in the Federal Register, the
information reported in accordance with such final regulations
shall be made available to the public in accordance with
procedures established by the Secretary.
(2) Definitions.--In this subsection:
(A) Nursing facility.--The term ``nursing facility''
has the meaning given such term in section 1919(a) of
the Social Security Act (42 U.S.C. 1396r(a)).
(B) Secretary.--The term ``Secretary'' means the
Secretary of Health and Human Services.
(C) Skilled nursing facility.--The term ``skilled
nursing facility'' has the meaning given such term in
section 1819(a) of the Social Security Act (42 U.S.C.
1395i-3(a)).
(c) Conforming Amendments.--
(1) Skilled nursing facilities.--Section 1819(d)(1) of the
Social Security Act (42 U.S.C. 1395i-3(d)(1)) is amended by
striking subparagraph (B) and redesignating subparagraph (C) as
subparagraph (B).
(2) Nursing facilities.--Section 1919(d)(1) of the Social
Security Act (42 U.S.C. 1396r(d)(1)) is amended by striking
subparagraph (B) and redesignating subparagraph (C) as
subparagraph (B).
SEC. 1412. ACCOUNTABILITY REQUIREMENTS.
(a) Effective Compliance and Ethics Programs.--
(1) Skilled nursing facilities.--Section 1819(d)(1) of the
Social Security Act (42 U.S.C. 1395i-3(d)(1)), as amended by
section 1411(c)(1), is amended by adding at the end the
following new subparagraph:
``(C) Compliance and ethics programs.--
``(i) Requirement.--On or after the date that
is 36 months after the date of the enactment of
this subparagraph, a skilled nursing facility
shall, with respect to the entity that operates
the facility (in this subparagraph referred to
as the `operating organization' or
`organization'), have in operation a compliance
and ethics program that is effective in
preventing and detecting criminal, civil, and
administrative violations under this Act and in
promoting quality of care consistent with
regulations developed under clause (ii).
``(ii) Development of regulations.--
``(I) In general.--Not later than the
date that is 2 years after such date of
the enactment, the Secretary, in
consultation with the Inspector General
of the Department of Health and Human
Services, shall promulgate regulations
for an effective compliance and ethics
program for operating organizations,
which may include a model compliance
program.
``(II) Design of regulations.--Such
regulations with respect to specific
elements or formality of a program may
vary with the size of the organization,
such that larger organizations should
have a more formal and rigorous program
and include established written
policies defining the standards and
procedures to be followed by its
employees. Such requirements shall
specifically apply to the corporate
level management of multi-unit nursing
home chains.
``(III) Evaluation.--Not later than 3
years after the date of promulgation of
regulations under this clause, the
Secretary shall complete an evaluation
of the compliance and ethics programs
required to be established under this
subparagraph. Such evaluation shall
determine if such programs led to
changes in deficiency citations,
changes in quality performance, or
changes in other metrics of resident
quality of care. The Secretary shall
submit to Congress a report on such
evaluation and shall include in such
report such recommendations regarding
changes in the requirements for such
programs as the Secretary determines
appropriate.
``(iii) Requirements for compliance and
ethics programs.--In this subparagraph, the
term `compliance and ethics program' means,
with respect to a skilled nursing facility, a
program of the operating organization that--
``(I) has been reasonably designed,
implemented, and enforced so that it
generally will be effective in
preventing and detecting criminal,
civil, and administrative violations
under this Act and in promoting quality
of care; and
``(II) includes at least the required
components specified in clause (iv).
``(iv) Required components of program.--The
required components of a compliance and ethics
program of an organization are the following:
``(I) The organization must have
established compliance standards and
procedures to be followed by its
employees, contractors, and other
agents that are reasonably capable of
reducing the prospect of criminal,
civil, and administrative violations
under this Act.
``(II) Specific individuals within
high-level personnel of the
organization must have been assigned
overall responsibility to oversee
compliance with such standards and
procedures and have sufficient
resources and authority to assure such
compliance.
``(III) The organization must have
used due care not to delegate
substantial discretionary authority to
individuals whom the organization knew,
or should have known through the
exercise of due diligence, had a
propensity to engage in criminal,
civil, and administrative violations
under this Act.
``(IV) The organization must have
taken steps to communicate effectively
its standards and procedures to all
employees and other agents, such as by
requiring participation in training
programs or by disseminating
publications that explain in a
practical manner what is required.
``(V) The organization must have
taken reasonable steps to achieve
compliance with its standards, such as
by utilizing monitoring and auditing
systems reasonably designed to detect
criminal, civil, and administrative
violations under this Act by its
employees and other agents and by
having in place and publicizing a
reporting system whereby employees and
other agents could report violations by
others within the organization without
fear of retribution.
``(VI) The standards must have been
consistently enforced through
appropriate disciplinary mechanisms,
including, as appropriate, discipline
of individuals responsible for the
failure to detect an offense.
``(VII) After an offense has been
detected, the organization must have
taken all reasonable steps to respond
appropriately to the offense and to
prevent further similar offenses,
including repayment of any funds to
which it was not entitled and any
necessary modification to its program
to prevent and detect criminal, civil,
and administrative violations under
this Act.
``(VIII) The organization must
periodically undertake reassessment of
its compliance program to identify
changes necessary to reflect changes
within the organization and its
facilities.
``(v) Coordination.--The provisions of this
subparagraph shall apply with respect to a
skilled nursing facility in lieu of section
1874(d).''.
(2) Nursing facilities.--Section 1919(d)(1) of the Social
Security Act (42 U.S.C. 1396r(d)(1)), as amended by section
1411(c)(2), is amended by adding at the end the following new
subparagraph:
``(C) Compliance and ethics program.--
``(i) Requirement.--On or after the date that
is 36 months after the date of the enactment of
this subparagraph, a nursing facility shall,
with respect to the entity that operates the
facility (in this subparagraph referred to as
the `operating organization' or
`organization'), have in operation a compliance
and ethics program that is effective in
preventing and detecting criminal, civil, and
administrative violations under this Act and in
promoting quality of care consistent with
regulations developed under clause (ii).
``(ii) Development of regulations.--
``(I) In general.--Not later than the
date that is 2 years after such date of
the enactment, the Secretary, in
consultation with the Inspector General
of the Department of Health and Human
Services, shall develop regulations for
an effective compliance and ethics
program for operating organizations,
which may include a model compliance
program.
``(II) Design of regulations.--Such
regulations with respect to specific
elements or formality of a program may
vary with the size of the organization,
such that larger organizations should
have a more formal and rigorous program
and include established written
policies defining the standards and
procedures to be followed by its
employees. Such requirements may
specifically apply to the corporate
level management of multi-unit nursing
home chains.
``(III) Evaluation.--Not later than 3
years after the date of promulgation of
regulations under this clause the
Secretary shall complete an evaluation
of the compliance and ethics programs
required to be established under this
subparagraph. Such evaluation shall
determine if such programs led to
changes in deficiency citations,
changes in quality performance, or
changes in other metrics of resident
quality of care. The Secretary shall
submit to Congress a report on such
evaluation and shall include in such
report such recommendations regarding
changes in the requirements for such
programs as the Secretary determines
appropriate.
``(iii) Requirements for compliance and
ethics programs.--In this subparagraph, the
term `compliance and ethics program' means,
with respect to a nursing facility, a program
of the operating organization that--
``(I) has been reasonably designed,
implemented, and enforced so that it
generally will be effective in
preventing and detecting criminal,
civil, and administrative violations
under this Act and in promoting quality
of care; and
``(II) includes at least the required
components specified in clause (iv).
``(iv) Required components of program.--The
required components of a compliance and ethics
program of an organization are the following:
``(I) The organization must have
established compliance standards and
procedures to be followed by its
employees and other agents that are
reasonably capable of reducing the
prospect of criminal, civil, and
administrative violations under this
Act.
``(II) Specific individuals within
high-level personnel of the
organization must have been assigned
overall responsibility to oversee
compliance with such standards and
procedures and has sufficient resources
and authority to assure such
compliance.
``(III) The organization must have
used due care not to delegate
substantial discretionary authority to
individuals whom the organization knew,
or should have known through the
exercise of due diligence, had a
propensity to engage in criminal,
civil, and administrative violations
under this Act.
``(IV) The organization must have
taken steps to communicate effectively
its standards and procedures to all
employees and other agents, such as by
requiring participation in training
programs or by disseminating
publications that explain in a
practical manner what is required.
``(V) The organization must have
taken reasonable steps to achieve
compliance with its standards, such as
by utilizing monitoring and auditing
systems reasonably designed to detect
criminal, civil, and administrative
violations under this Act by its
employees and other agents and by
having in place and publicizing a
reporting system whereby employees and
other agents could report violations by
others within the organization without
fear of retribution.
``(VI) The standards must have been
consistently enforced through
appropriate disciplinary mechanisms,
including, as appropriate, discipline
of individuals responsible for the
failure to detect an offense.
``(VII) After an offense has been
detected, the organization must have
taken all reasonable steps to respond
appropriately to the offense and to
prevent further similar offenses,
including repayment of any funds to
which it was not entitled and any
necessary modification to its program
to prevent and detect criminal, civil,
and administrative violations under
this Act.
``(VIII) The organization must
periodically undertake reassessment of
its compliance program to identify
changes necessary to reflect changes
within the organization and its
facilities.
``(v) Coordination.--The provisions of this
subparagraph shall apply with respect to a
nursing facility in lieu of section
1902(a)(77).''.
(b) Quality Assurance and Performance Improvement Program.--
(1) Skilled nursing facilities.--Section 1819(b)(1)(B) of the
Social Security Act (42 U.S.C. 1396r(b)(1)(B)) is amended--
(A) by striking ``assurance'' and inserting
``assurance and quality assurance and performance
improvement program'';
(B) by designating the matter beginning with ``A
skilled nursing facility'' as a clause (i) with the
heading ``In general.--'' and the appropriate
indentation;
(C) in clause (i) (as so designated by subparagraph
(B)), by redesignating clauses (i) and (ii) as
subclauses (I) and (II), respectively; and
(D) by adding at the end the following new clause:
``(ii) Quality assurance and performance
improvement program.--
``(I) In general.--Not later than
December 31, 2011, the Secretary shall
establish and implement a quality
assurance and performance improvement
program (in this clause referred to as
the `QAPI program') for skilled nursing
facilities, including multi-unit chains
of such facilities. Under the QAPI
program, the Secretary shall establish
standards relating to such facilities
and provide technical assistance to
such facilities on the development of
best practices in order to meet such
standards. Not later than 1 year after
the date on which the regulations are
promulgated under subclause (II), a
skilled nursing facility must submit to
the Secretary a plan for the facility
to meet such standards and implement
such best practices, including how to
coordinate the implementation of such
plan with quality assessment and
assurance activities conducted under
clause (i).
``(II) Regulations.--The Secretary
shall promulgate regulations to carry
out this clause.''.
(2) Nursing facilities.--Section 1919(b)(1)(B) of the Social
Security Act (42 U.S.C. 1396r(b)(1)(B)) is amended--
(A) by striking ``assurance'' and inserting
``assurance and quality assurance and performance
improvement program'';
(B) by designating the matter beginning with ``A
nursing facility'' as a clause (i) with the heading
``In general.--'' and the appropriate indentation; and
(C) by adding at the end the following new clause:
``(ii) Quality assurance and performance
improvement program.--
``(I) In general.--Not later than
December 31, 2011, the Secretary shall
establish and implement a quality
assurance and performance improvement
program (in this clause referred to as
the `QAPI program') for nursing
facilities, including multi-unit chains
of such facilities. Under the QAPI
program, the Secretary shall establish
standards relating to such facilities
and provide technical assistance to
such facilities on the development of
best practices in order to meet such
standards. Not later than 1 year after
the date on which the regulations are
promulgated under subclause (II), a
nursing facility must submit to the
Secretary a plan for the facility to
meet such standards and implement such
best practices, including how to
coordinate the implementation of such
plan with quality assessment and
assurance activities conducted under
clause (i).
``(II) Regulations.--The Secretary
shall promulgate regulations to carry
out this clause.''.
(3) Proposal to revise quality assurance and performance
improvement programs.--The Secretary shall include in the
proposed rule published under section 1888(e) of the Social
Security Act (42 U.S.C. 1395yy(e)(5)(A)) for the subsequent
fiscal year to the extent otherwise authorized under section
1819(b)(1)(B) or 1819(d)(1)(C) of the Social Security Act or
other statutory or regulatory authority, one or more proposals
for skilled nursing facilities to modify and strengthen quality
assurance and performance improvement programs in such
facilities. At the time of publication of such proposed rule
and to the extent otherwise authorized under section
1919(b)(1)(B) or 1919(d)(1)(C) of such Act or other regulatory
authority.
(4) Facility plan.--Not later than 1 year after the date on
which the regulations are promulgated under subclause (II) of
clause (ii) of sections 1819(b)(1)(B) and 1919(b)(1)(B) of the
Social Security Act, as added by paragraphs (1) and (2), a
skilled nursing facility and a nursing facility must submit to
the Secretary a plan for the facility to meet the standards
under such regulations and implement such best practices,
including how to coordinate the implementation of such plan
with quality assessment and assurance activities conducted
under clause (i) of such sections.
(c) GAO Study on Nursing Facility Undercapitalization.--
(1) In general.--The Comptroller General of the United States
shall conduct a study that examines the following:
(A) The extent to which corporations that own or
operate large numbers of nursing facilities, taking
into account ownership type (including private equity
and control interests), are undercapitalizing such
facilities.
(B) The effects of such undercapitalization on
quality of care, including staffing and food costs, at
such facilities.
(C) Options to address such undercapitalization, such
as requirements relating to surety bonds, liability
insurance, or minimum capitalization.
(2) Report.--Not later than 18 months after the date of the
enactment of this Act, the Comptroller General shall submit to
Congress a report on the study conducted under paragraph (1).
(3) Nursing facility.--In this subsection, the term ``nursing
facility'' includes a skilled nursing facility.
SEC. 1413. NURSING HOME COMPARE MEDICARE WEBSITE.
(a) Skilled Nursing Facilities.--
(1) In general.--Section 1819 of the Social Security Act (42
U.S.C. 1395i-3) is amended--
(A) by redesignating subsection (i) as subsection
(j); and
(B) by inserting after subsection (h) the following
new subsection:
``(i) Nursing Home Compare Website.--
``(1) Inclusion of additional information.--
``(A) In general.--The Secretary shall ensure that
the Department of Health and Human Services includes,
as part of the information provided for comparison of
nursing homes on the official Internet website of the
Federal Government for Medicare beneficiaries (commonly
referred to as the `Nursing Home Compare' Medicare
website) (or a successor website), the following
information in a manner that is prominent, easily
accessible, readily understandable to consumers of
long-term care services, and searchable:
``(i) Information that is reported to the
Secretary under section 1124(c)(4).
``(ii) Information on the `Special Focus
Facility program' (or a successor program)
established by the Centers for Medicare and
Medicaid Services, according to procedures
established by the Secretary. Such procedures
shall provide for the inclusion of information
with respect to, and the names and locations
of, those facilities that, since the previous
quarter--
``(I) were newly enrolled in the
program;
``(II) are enrolled in the program
and have failed to significantly
improve;
``(III) are enrolled in the program
and have significantly improved;
``(IV) have graduated from the
program; and
``(V) have closed voluntarily or no
longer participate under this title.
``(iii) Staffing data for each facility
(including resident census data and data on the
hours of care provided per resident per day)
based on data submitted under subsection
(b)(8)(C), including information on staffing
turnover and tenure, in a format that is
clearly understandable to consumers of long-
term care services and allows such consumers to
compare differences in staffing between
facilities and State and national averages for
the facilities. Such format shall include--
``(I) concise explanations of how to
interpret the data (such as a plain
English explanation of data reflecting
`nursing home staff hours per resident
day');
``(II) differences in types of staff
(such as training associated with
different categories of staff);
``(III) the relationship between
nurse staffing levels and quality of
care; and
``(IV) an explanation that
appropriate staffing levels vary based
on patient case mix.
``(iv) Links to State Internet websites with
information regarding State survey and
certification programs, links to Form 2567
State inspection reports (or a successor form)
on such websites, information to guide
consumers in how to interpret and understand
such reports, and the facility plan of
correction or other response to such report.
``(v) The standardized complaint form
developed under subsection (f)(8), including
explanatory material on what complaint forms
are, how they are used, and how to file a
complaint with the State survey and
certification program and the State long-term
care ombudsman program.
``(vi) Summary information on the number,
type, severity, and outcome of substantiated
complaints.
``(vii) The number of adjudicated instances
of criminal violations by employees of a a
nursing facility--
``(I) that were committed inside the
facility;
``(II) with respect to such instances
of violations or crimes committed
inside of the facility that were the
violations or crimes of abuse, neglect,
and exploitation, criminal sexual
abuse, or other violations or crimes
that resulted in serious bodily injury;
and
``(III) the number of civil monetary
penalties levied against the facility,
employees, contractors, and other
agents.
``(B) Deadline for provision of information.--
``(i) In general.--Except as provided in
clause (ii), the Secretary shall ensure that
the information described in subparagraph (A)
is included on such website (or a successor
website) not later than 1 year after the date
of the enactment of this subsection.
``(ii) Exception.--The Secretary shall ensure
that the information described in subparagraph
(A)(i) and (A)(iii) is included on such website
(or a successor website) not later than the
date on which the requirements under section
1124(c)(4) and subsection (b)(8)(C)(ii) are
implemented.
``(2) Review and modification of website.--
``(A) In general.--The Secretary shall establish a
process--
``(i) to review the accuracy, clarity of
presentation, timeliness, and comprehensiveness
of information reported on such website as of
the day before the date of the enactment of
this subsection; and
``(ii) not later than 1 year after the date
of the enactment of this subsection, to modify
or revamp such website in accordance with the
review conducted under clause (i).
``(B) Consultation.--In conducting the review under
subparagraph (A)(i), the Secretary shall consult with--
``(i) State long-term care ombudsman
programs;
``(ii) consumer advocacy groups;
``(iii) provider stakeholder groups; and
``(iv) any other representatives of programs
or groups the Secretary determines
appropriate.''.
(2) Timeliness of submission of survey and certification
information.--
(A) In general.--Section 1819(g)(5) of the Social
Security Act (42 U.S.C. 1395i-3(g)(5)) is amended by
adding at the end the following new subparagraph:
``(E) Submission of survey and certification
information to the secretary.--In order to improve the
timeliness of information made available to the public
under subparagraph (A) and provided on the Nursing Home
Compare Medicare website under subsection (i), each
State shall submit information respecting any survey or
certification made respecting a skilled nursing
facility (including any enforcement actions taken by
the State) to the Secretary not later than the date on
which the State sends such information to the facility.
The Secretary shall use the information submitted under
the preceding sentence to update the information
provided on the Nursing Home Compare Medicare website
as expeditiously as practicable but not less frequently
than quarterly.''.
(B) Effective date.--The amendment made by this
paragraph shall take effect 1 year after the date of
the enactment of this Act.
(3) Special focus facility program.--Section 1819(f) of such
Act is amended by adding at the end the following new
paragraph:
``(8) Special focus facility program.--
``(A) In general.--The Secretary shall conduct a
special focus facility program for enforcement of
requirements for skilled nursing facilities that the
Secretary has identified as having substantially failed
to meet applicable requirement of this Act.
``(B) Periodic surveys.--Under such program the
Secretary shall conduct surveys of each facility in the
program not less than once every 6 months.''.
(b) Nursing Facilities.--
(1) In general.--Section 1919 of the Social Security Act (42
U.S.C. 1396r) is amended--
(A) by redesignating subsection (i) as subsection
(j); and
(B) by inserting after subsection (h) the following
new subsection:
``(i) Nursing Home Compare Website.--
``(1) Inclusion of additional information.--
``(A) In general.--The Secretary shall ensure that
the Department of Health and Human Services includes,
as part of the information provided for comparison of
nursing homes on the official Internet website of the
Federal Government for Medicare beneficiaries (commonly
referred to as the `Nursing Home Compare' Medicare
website) (or a successor website), the following
information in a manner that is prominent, easily
accessible, readily understandable to consumers of
long-term care services, and searchable:
``(i) Staffing data for each facility
(including resident census data and data on the
hours of care provided per resident per day)
based on data submitted under subsection
(b)(8)(C)(ii), including information on
staffing turnover and tenure, in a format that
is clearly understandable to consumers of long-
term care services and allows such consumers to
compare differences in staffing between
facilities and State and national averages for
the facilities. Such format shall include--
``(I) concise explanations of how to
interpret the data (such as plain
English explanation of data reflecting
`nursing home staff hours per resident
day');
``(II) differences in types of staff
(such as training associated with
different categories of staff);
``(III) the relationship between
nurse staffing levels and quality of
care; and
``(IV) an explanation that
appropriate staffing levels vary based
on patient case mix.
``(ii) Links to State Internet websites with
information regarding State survey and
certification programs, links to Form 2567
State inspection reports (or a successor form)
on such websites, information to guide
consumers in how to interpret and understand
such reports, and the facility plan of
correction or other response to such report.
``(iii) The standardized complaint form
developed under subsection (f)(10), including
explanatory material on what complaint forms
are, how they are used, and how to file a
complaint with the State survey and
certification program and the State long-term
care ombudsman program.
``(iv) Summary information on the number,
type, severity, and outcome of substantiated
complaints.
``(v) The number of adjudicated instances of
criminal violations by employees of a nursing
facility--
``(I) that were committed inside of
the facility; and
``(II) with respect to such instances
of violations or crimes committed
outside of the facility, that were the
violations or crimes that resulted in
the serious bodily injury of an elder.
``(B) Deadline for provision of information.--
``(i) In general.--Except as provided in
clause (ii), the Secretary shall ensure that
the information described in subparagraph (A)
is included on such website (or a successor
website) not later than 1 year after the date
of the enactment of this subsection.
``(ii) Exception.--The Secretary shall ensure
that the information described in subparagraph
(A)(i) and (A)(iii) is included on such website
(or a successor website) not later than the
date on which the requirements under section
1124(c)(4) and subsection (b)(8)(C)(ii) are
implemented.
``(2) Review and modification of website.--
``(A) In general.--The Secretary shall establish a
process--
``(i) to review the accuracy, clarity of
presentation, timeliness, and comprehensiveness
of information reported on such website as of
the day before the date of the enactment of
this subsection; and
``(ii) not later than 1 year after the date
of the enactment of this subsection, to modify
or revamp such website in accordance with the
review conducted under clause (i).
``(B) Consultation.--In conducting the review under
subparagraph (A)(i), the Secretary shall consult with--
``(i) State long-term care ombudsman
programs;
``(ii) consumer advocacy groups;
``(iii) provider stakeholder groups;
``(iv) skilled nursing facility employees and
their representatives; and
``(v) any other representatives of programs
or groups the Secretary determines
appropriate.''.
(2) Timeliness of submission of survey and certification
information.--
(A) In general.--Section 1919(g)(5) of the Social
Security Act (42 U.S.C. 1396r(g)(5)) is amended by
adding at the end the following new subparagraph:
``(E) Submission of survey and certification
information to the secretary.--In order to improve the
timeliness of information made available to the public
under subparagraph (A) and provided on the Nursing Home
Compare Medicare website under subsection (i), each
State shall submit information respecting any survey or
certification made respecting a nursing facility
(including any enforcement actions taken by the State)
to the Secretary not later than the date on which the
State sends such information to the facility. The
Secretary shall use the information submitted under the
preceding sentence to update the information provided
on the Nursing Home Compare Medicare website as
expeditiously as practicable but not less frequently
than quarterly.''.
(B) Effective date.--The amendment made by this
paragraph shall take effect 1 year after the date of
the enactment of this Act.
(3) Special focus facility program.--Section 1919(f) of such
Act is amended by adding at the end of the following new
paragraph:
``(10) Special focus facility program.--
``(A) In general.--The Secretary shall conduct a
special focus facility program for enforcement of
requirements for nursing facilities that the Secretary
has identified as having substantially failed to meet
applicable requirements of this Act.
``(B) Periodic surveys.--Under such program the
Secretary shall conduct surveys of each facility in the
program not less often than once every 6 months.''.
(c) Availability of Reports on Surveys, Certifications, and Complaint
Investigations.--
(1) Skilled nursing facilities.--Section 1819(d)(1) of the
Social Security Act (42 U.S.C. 1395i-3(d)(1)), as amended by
sections 1411 and 1412, is amended by adding at the end the
following new subparagraph:
``(D) Availability of survey, certification, and
complaint investigation reports.--A skilled nursing
facility must--
``(i) have reports with respect to any
surveys, certifications, and complaint
investigations made respecting the facility
during the 3 preceding years available for any
individual to review upon request; and
``(ii) post notice of the availability of
such reports in areas of the facility that are
prominent and accessible to the public.
The facility shall not make available under clause (i)
identifying information about complainants or
residents.''.
(2) Nursing facilities.--Section 1919(d)(1) of the Social
Security Act (42 U.S.C. 1396r(d)(1)), as amended by sections
1411 and 1412, is amended by adding at the end the following
new subparagraph:
``(D) Availability of survey, certification, and
complaint investigation reports.--A nursing facility
must--
``(i) have reports with respect to any
surveys, certifications, and complaint
investigations made respecting the facility
during the 3 preceding years available for any
individual to review upon request; and
``(ii) post notice of the availability of
such reports in areas of the facility that are
prominent and accessible to the public.
The facility shall not make available under clause (i)
identifying information about complainants or
residents.''.
(3) Effective date.--The amendments made by this subsection
shall take effect 1 year after the date of the enactment of
this Act.
(d) Guidance to States on Form 2567 State Inspection Reports and
Complaint Investigation Reports.--
(1) Guidance.--The Secretary of Health and Human Services (in
this subtitle referred to as the ``Secretary'') shall provide
guidance to States on how States can establish electronic links
to Form 2567 State inspection reports (or a successor form),
complaint investigation reports, and a facility's plan of
correction or other response to such Form 2567 State inspection
reports (or a successor form) on the Internet website of the
State that provides information on skilled nursing facilities
and nursing facilities and the Secretary shall, if possible,
include such information on Nursing Home Compare.
(2) Requirement.--Section 1902(a)(9) of the Social Security
Act (42 U.S.C. 1396a(a)(9)) is amended--
(A) by striking ``and'' at the end of subparagraph
(B);
(B) by striking the semicolon at the end of
subparagraph (C) and inserting ``, and''; and
(C) by adding at the end the following new
subparagraph:
``(D) that the State maintain a consumer-oriented
website providing useful information to consumers
regarding all skilled nursing facilities and all
nursing facilities in the State, including for each
facility, Form 2567 State inspection reports (or a
successor form), complaint investigation reports, the
facility's plan of correction, and such other
information that the State or the Secretary considers
useful in assisting the public to assess the quality of
long term care options and the quality of care provided
by individual facilities;''.
(3) Definitions.--In this subsection:
(A) Nursing facility.--The term ``nursing facility''
has the meaning given such term in section 1919(a) of
the Social Security Act (42 U.S.C. 1396r(a)).
(B) Secretary.--The term ``Secretary'' means the
Secretary of Health and Human Services.
(C) Skilled nursing facility.--The term ``skilled
nursing facility'' has the meaning given such term in
section 1819(a) of the Social Security Act (42 U.S.C.
1395i-3(a)).
SEC. 1414. REPORTING OF EXPENDITURES.
Section 1888 of the Social Security Act (42 U.S.C. 1395yy) is amended
by adding at the end the following new subsection:
``(f) Reporting of Direct Care Expenditures.--
``(1) In general.--For cost reports submitted under this
title for cost reporting periods beginning on or after the date
that is 3 years after the date of the enactment of this
subsection, skilled nursing facilities shall separately report
expenditures for wages and benefits for direct care staff
(breaking out (at a minimum) registered nurses, licensed
professional nurses, certified nurse assistants, and other
medical and therapy staff).
``(2) Modification of form.--The Secretary, in consultation
with private sector accountants experienced with skilled
nursing facility cost reports, shall redesign such reports to
meet the requirement of paragraph (1) not later than 1 year
after the date of the enactment of this subsection.
``(3) Categorization by functional accounts.--Not later than
30 months after the date of the enactment of this subsection,
the Secretary, working in consultation with the Medicare
Payment Advisory Commission, the Inspector General of the
Department of Health and Human Services, and other expert
parties the Secretary determines appropriate, shall take the
expenditures listed on cost reports, as modified under
paragraph (1), submitted by skilled nursing facilities and
categorize such expenditures, regardless of any source of
payment for such expenditures, for each skilled nursing
facility into the following functional accounts on an annual
basis:
``(A) Spending on direct care services (including
nursing, therapy, and medical services).
``(B) Spending on indirect care (including
housekeeping and dietary services).
``(C) Capital assets (including building and land
costs).
``(D) Administrative services costs.
``(4) Availability of information submitted.--The Secretary
shall establish procedures to make information on expenditures
submitted under this subsection readily available to interested
parties upon request, subject to such requirements as the
Secretary may specify under the procedures established under
this paragraph.''.
SEC. 1415. STANDARDIZED COMPLAINT FORM.
(a) Skilled Nursing Facilities.--
(1) Development by the secretary.--Section 1819(f) of the
Social Security Act (42 U.S.C. 1395i-3(f)), as amended by
section 1413(a)(3), is amended by adding at the end the
following new paragraph:
``(9) Standardized complaint form.--The Secretary shall
develop a standardized complaint form for use by a resident (or
a person acting on the resident's behalf) in filing a complaint
with a State survey and certification agency and a State long-
term care ombudsman program with respect to a skilled nursing
facility.''.
(2) State requirements.--Section 1819(e) of the Social
Security Act (42 U.S.C. 1395i-3(e)) is amended by adding at the
end the following new paragraph:
``(6) Complaint processes and whistle-blower protection.--
``(A) Complaint forms.--The State must make the
standardized complaint form developed under subsection
(f)(9) available upon request to--
``(i) a resident of a skilled nursing
facility;
``(ii) any person acting on the resident's
behalf; and
``(iii) any person who works at a skilled
nursing facility or is a representative of such
a worker.
``(B) Complaint resolution process.--The State must
establish a complaint resolution process in order to
ensure that a resident, the legal representative of a
resident of a skilled nursing facility, or other
responsible party is not retaliated against if the
resident, legal representative, or responsible party
has complained, in good faith, about the quality of
care or other issues relating to the skilled nursing
facility, that the legal representative of a resident
of a skilled nursing facility or other responsible
party is not denied access to such resident or
otherwise retaliated against if such representative
party has complained, in good faith, about the quality
of care provided by the facility or other issues
relating to the facility, and that a person who works
at a skilled nursing facility is not retaliated against
if the worker has complained, in good faith, about
quality of care or services or an issue relating to the
quality of care or services provided at the facility,
whether the resident, legal representative, other
responsible party, or worker used the form developed
under subsection (f)(9) or some other method for
submitting the complaint. Such complaint resolution
process shall include--
``(i) procedures to assure accurate tracking
of complaints received, including notification
to the complainant that a complaint has been
received;
``(ii) procedures to determine the likely
severity of a complaint and for the
investigation of the complaint;
``(iii) deadlines for responding to a
complaint and for notifying the complainant of
the outcome of the investigation; and
``(iv) procedures to ensure that the identity
of the complainant will be kept confidential.
``(C) Whistleblower protection.--
``(i) Prohibition against retaliation.--No
person who works at a skilled nursing facility
may be penalized, discriminated, or retaliated
against with respect to any aspect of
employment, including discharge, promotion,
compensation, terms, conditions, or privileges
of employment, or have a contract for services
terminated, because the person (or anyone
acting at the person's request) complained, in
good faith, about the quality of care or
services provided by a nursing facility or
about other issues relating to quality of care
or services, whether using the form developed
under subsection (f)(9) or some other method
for submitting the complaint.
``(ii) Retaliatory reporting.--A skilled
nursing facility may not file a complaint or a
report against a person who works (or has
worked at the facility with the appropriate
State professional disciplinary agency because
the person (or anyone acting at the person's
request) complained in good faith, as described
in clause (i).
``(iii) Commencement of action.--Any person
who believes the person has been penalized,
discriminated , or retaliated against or had a
contract for services terminated in violation
of clause (i) or against whom a complaint has
been filed in violation of clause (ii) may
bring an action at law or equity in the
appropriate district court of the United
States, which shall have jurisdiction over such
action without regard to the amount in
controversy or the citizenship of the parties,
and which shall have jurisdiction to grant
complete relief, including, but not limited to,
injunctive relief (such as reinstatement,
compensatory damages (which may include
reimbursement of lost wages, compensation, and
benefits), costs of litigation (including
reasonable attorney and expert witness fees),
exemplary damages where appropriate, and such
other relief as the court deems just and
proper.
``(iv) Rights not waivable.--The rights
protected by this paragraph may not be
diminished by contract or other agreement, and
nothing in this paragraph shall be construed to
diminish any greater or additional protection
provided by Federal or State law or by contract
or other agreement.
``(v) Requirement to post notice of employee
rights.--Each skilled nursing facility shall
post conspicuously in an appropriate location a
sign (in a form specified by the Secretary)
specifying the rights of persons under this
paragraph and including a statement that an
employee may file a complaint with the
Secretary against a skilled nursing facility
that violates the provisions of this paragraph
and information with respect to the manner of
filing such a complaint.
``(D) Rule of construction.--Nothing in this
paragraph shall be construed as preventing a resident
of a skilled nursing facility (or a person acting on
the resident's behalf) from submitting a complaint in a
manner or format other than by using the standardized
complaint form developed under subsection (f)(9)
(including submitting a complaint orally).
``(E) Good faith defined.--For purposes of this
paragraph, an individual shall be deemed to be acting
in good faith with respect to the filing of a complaint
if the individual reasonably believes--
``(i) the information reported or disclosed
in the complaint is true; and
``(ii) the violation of this title has
occurred or may occur in relation to such
information.''.
(b) Nursing Facilities.--
(1) Development by the secretary.--Section 1919(f) of the
Social Security Act (42 U.S.C. 1395i-3(f)), as amended by
section 1413(b), is amended by adding at the end the following
new paragraph:
``(11) Standardized complaint form.--The Secretary shall
develop a standardized complaint form for use by a resident (or
a person acting on the resident's behalf) in filing a complaint
with a State survey and certification agency and a State long-
term care ombudsman program with respect to a nursing
facility.''.
(2) State requirements.--Section 1919(e) of the Social
Security Act (42 U.S.C. 1395i-3(e)) is amended by adding at the
end the following new paragraph:
``(8) Complaint processes and whistleblower protection.--
``(A) Complaint forms.--The State must make the
standardized complaint form developed under subsection
(f)(11) available upon request to--
``(i) a resident of a nursing facility;
``(ii) any person acting on the resident's
behalf; and
``(iii) any person who works at a nursing
facility or a representative of such a worker.
``(B) Complaint resolution process.--The State must
establish a complaint resolution process in order to
ensure that a resident, the legal representative of a
resident of a nursing facility, or other responsible
party is not retaliated against if the resident, legal
representative, or responsible party has complained, in
good faith, about the quality of care or other issues
relating to the nursing facility, that the legal
representative of a resident of a nursing facility or
other responsible party is not denied access to such
resident or otherwise retaliated against if such
representative party has complained, in good faith,
about the quality of care provided by the facility or
other issues relating to the facility, and that a
person who works at a nursing facility is not
retaliated against if the worker has complained, in
good faith, about quality of care or services or an
issue relating to the quality of care or services
provided at the facility, whether the resident, legal
representative, other responsible party, or worker used
the form developed under subsection (f)(11) or some
other method for submitting the complaint. Such
complaint resolution process shall include--
``(i) procedures to assure accurate tracking
of complaints received, including notification
to the complainant that a complaint has been
received;
``(ii) procedures to determine the likely
severity of a complaint and for the
investigation of the complaint;
``(iii) deadlines for responding to a
complaint and for notifying the complainant of
the outcome of the investigation; and
``(iv) procedures to ensure that the identity
of the complainant will be kept confidential.
``(C) Whistleblower protection.--
``(i) Prohibition against retaliation.--No
person who works at a nursing facility may be
penalized, discriminated, or retaliated against
with respect to any aspect of employment,
including discharge, promotion, compensation,
terms, conditions, or privileges of employment,
or have a contract for services terminated,
because the person (or anyone acting at the
person's request) complained, in good faith,
about the quality of care or services provided
by a nursing facility or about other issues
relating to quality of care or services,
whether using the form developed under
subsection (f)(11) or some other method for
submitting the complaint.
``(ii) Retaliatory reporting.--A nursing
facility may not file a complaint or a report
against a person who works (or has worked at
the facility with the appropriate State
professional disciplinary agency because the
person (or anyone acting at the person's
request) complained in good faith, as described
in clause (i).
``(iii) Commencement of action.--Any person
who believes the person has been penalized,
discriminated, or retaliated against or had a
contract for services terminated in violation
of clause (i) or against whom a complaint has
been filed in violation of clause (ii) may
bring an action at law or equity in the
appropriate district court of the United
States, which shall have jurisdiction over such
action without regard to the amount in
controversy or the citizenship of the parties,
and which shall have jurisdiction to grant
complete relief, including, but not limited to,
injunctive relief (such as reinstatement,
compensatory damages (which may include
reimbursement of lost wages, compensation, and
benefits), costs of litigation (including
reasonable attorney and expert witness fees),
exemplary damages where appropriate, and such
other relief as the court deems just and
proper.
``(iv) Rights not waivable.--The rights
protected by this paragraph may not be
diminished by contract or other agreement, and
nothing in this paragraph shall be construed to
diminish any greater or additional protection
provided by Federal or State law or by contract
or other agreement.
``(v) Requirement to post notice of employee
rights.--Each nursing facility shall post
conspicuously in an appropriate location a sign
(in a form specified by the Secretary)
specifying the rights of persons under this
paragraph and including a statement that an
employee may file a complaint with the
Secretary against a nursing facility that
violates the provisions of this paragraph and
information with respect to the manner of
filing such a complaint.
``(D) Rule of construction.--Nothing in this
paragraph shall be construed as preventing a resident
of a nursing facility (or a person acting on the
resident's behalf) from submitting a complaint in a
manner or format other than by using the standardized
complaint form developed under subsection (f)(11)
(including submitting a complaint orally).
``(E) Good faith defined.--For purposes of this
paragraph, an individual shall be deemed to be acting
in good faith with respect to the filing of a complaint
if the individual reasonably believes--
``(i) the information reported or disclosed
in the complaint is true; and
``(ii) the violation of this title has
occurred or may occur in relation to such
information.''.
(c) Effective Date.--The amendments made by this section shall take
effect 1 year after the date of the enactment of this Act.
SEC. 1416. ENSURING STAFFING ACCOUNTABILITY.
(a) Skilled Nursing Facilities.--Section 1819(b)(8) of the Social
Security Act (42 U.S.C. 1395i-3(b)(8)) is amended by adding at the end
the following new subparagraph:
``(C) Submission of staffing information based on
payroll data in a uniform format.--Beginning not later
than 2 years after the date of the enactment of this
subparagraph, and after consulting with State long-term
care ombudsman programs, consumer advocacy groups,
provider stakeholder groups, employees and their
representatives, and other parties the Secretary deems
appropriate, the Secretary shall require a skilled
nursing facility to electronically submit to the
Secretary direct care staffing information (including
information with respect to agency and contract staff)
based on payroll and other verifiable and auditable
data in a uniform format (according to specifications
established by the Secretary in consultation with such
programs, groups, and parties). Such specifications
shall require that the information submitted under the
preceding sentence--
``(i) specify the category of work a
certified employee performs (such as whether
the employee is a registered nurse, licensed
practical nurse, licensed vocational nurse,
certified nursing assistant, therapist, or
other medical personnel);
``(ii) include resident census data and
information on resident case mix;
``(iii) include a regular reporting schedule;
and
``(iv) include information on employee
turnover and tenure and on the hours of care
provided by each category of certified
employees referenced in clause (i) per resident
per day.
Nothing in this subparagraph shall be construed as
preventing the Secretary from requiring submission of
such information with respect to specific categories,
such as nursing staff, before other categories of
certified employees. Information under this
subparagraph with respect to agency and contract staff
shall be kept separate from information on employee
staffing.''.
(b) Nursing Facilities.--Section 1919(b)(8) of the Social Security
Act (42 U.S.C. 1396r(b)(8)) is amended by adding at the end the
following new subparagraph:
``(C) Submission of staffing information based on
payroll data in a uniform format.--Beginning not later
than 2 years after the date of the enactment of this
subparagraph, and after consulting with State long-term
care ombudsman programs, consumer advocacy groups,
provider stakeholder groups, employees and their
representatives, and other parties the Secretary deems
appropriate, the Secretary shall require a nursing
facility to electronically submit to the Secretary
direct care staffing information (including information
with respect to agency and contract staff) based on
payroll and other verifiable and auditable data in a
uniform format (according to specifications established
by the Secretary in consultation with such programs,
groups, and parties). Such specifications shall require
that the information submitted under the preceding
sentence--
``(i) specify the category of work a
certified employee performs (such as whether
the employee is a registered nurse, licensed
practical nurse, licensed vocational nurse,
certified nursing assistant, therapist, or
other medical personnel);
``(ii) include resident census data and
information on resident case mix;
``(iii) include a regular reporting schedule;
and
``(iv) include information on employee
turnover and tenure and on the hours of care
provided by each category of certified
employees referenced in clause (i) per resident
per day.
Nothing in this subparagraph shall be construed as
preventing the Secretary from requiring submission of
such information with respect to specific categories,
such as nursing staff, before other categories of
certified employees. Information under this
subparagraph with respect to agency and contract staff
shall be kept separate from information on employee
staffing.''.
PART 2--TARGETING ENFORCEMENT
SEC. 1421. CIVIL MONEY PENALTIES.
(a) Skilled Nursing Facilities.--
(1) In general.--Section 1819(h)(2)(B)(ii) of the Social
Security Act (42 U.S.C. 1395i-3(h)(2)(B)(ii)) is amended to
read as follows:
``(ii) Authority with respect to civil money
penalties.--
``(I) Amount.--The Secretary may
impose a civil money penalty in the
applicable per instance or per day
amount (as defined in subclause (II)
and (III)) for each day or instance,
respectively, of noncompliance (as
determined appropriate by the
Secretary).
``(II) Applicable per instance
amount.--In this clause, the term
`applicable per instance amount'
means--
``(aa) in the case where the
deficiency is found to be a
direct proximate cause of death
of a resident of the facility,
an amount not to exceed
$100,000;
``(bb) in each case of a
deficiency where the facility
is cited for actual harm or
immediate jeopardy, an amount
not less than $3,050 and not
more than $25,000; and
``(cc) in each case of any
other deficiency, an amount not
less than $250 and not to
exceed $3050.
``(III) Applicable per day amount.--
In this clause, the term `applicable
per day amount' means--
``(aa) in each case of a
deficiency where the facility
is cited for actual harm or
immediate jeopardy, an amount
not less than $3,050 and not
more than $25,000, and
``(bb) in each case of any
other deficiency, an amount not
less than $250 and not to
exceed $3,050.
``(IV) Reduction of civil money
penalties in certain circumstances.--
Subject to subclauses (V) and (VI), in
the case where a facility self-reports
and promptly corrects a deficiency for
which a penalty was imposed under this
clause not later than 10 calendar days
after the date of such imposition, the
Secretary may reduce the amount of the
penalty imposed by not more than 50
percent.
``(V) Prohibition on reduction for
certain deficiencies.--
``(aa) Repeat deficiencies.--
The Secretary may not reduce
under subclause (IV) the amount
of a penalty if the deficiency
is a repeat deficiency.
``(bb) Certain other
deficiencies.--The Secretary
may not reduce under subclause
(IV) the amount of a penalty if
the penalty is imposed for a
deficiency described in
subclause (II)(aa) or (III)(aa)
and the actual harm or
widespread harm immediately
jeopardizes the health or
safety of a resident or
residents of the facility, or
if the penalty is imposed for a
deficiency described in
subclause (II)(bb).
``(VI) Limitation on aggregate
reductions.--The aggregate reduction in
a penalty under subclause (IV) may not
exceed 35 percent on the basis of self-
reporting, on the basis of a waiver or
an appeal (as provided for under
regulations under section 488.436 of
title 42, Code of Federal Regulations),
or on the basis of both.
``(VII) Collection of civil money
penalties.--In the case of a civil
money penalty imposed under this
clause, the Secretary--
``(aa) subject to item (cc),
shall, not later than 30 days
after the date of imposition of
the penalty, provide the
opportunity for the facility to
participate in an independent
informal dispute resolution
process which generates a
written record prior to the
collection of such penalty, but
such opportunity shall not
affect the responsibility of
the State survey agency for
making final recommendations
for such penalties;
``(bb) in the case where the
penalty is imposed for each day
of noncompliance, shall not
impose a penalty for any day
during the period beginning on
the initial day of the
imposition of the penalty and
ending on the day on which the
informal dispute resolution
process under item (aa) is
completed;
``(cc) may provide for the
collection of such civil money
penalty and the placement of
such amounts collected in an
escrow account under the
direction of the Secretary on
the earlier of the date on
which the informal dispute
resolution process under item
(aa) is completed or the date
that is 90 days after the date
of the imposition of the
penalty;
``(dd) may provide that such
amounts collected are kept in
such account pending the
resolution of any subsequent
appeals;
``(ee) in the case where the
facility successfully appeals
the penalty, may provide for
the return of such amounts
collected (plus interest) to
the facility; and
``(ff) in the case where all
such appeals are unsuccessful,
may provide that some portion
of such amounts collected may
be used to support activities
that benefit residents,
including assistance to support
and protect residents of a
facility that closes
(voluntarily or involuntarily)
or is decertified (including
offsetting costs of relocating
residents to home and
community-based settings or
another facility), projects
that support resident and
family councils and other
consumer involvement in
assuring quality care in
facilities, and facility
improvement initiatives
approved by the Secretary
(including joint training of
facility staff and surveyors,
technical assistance for
facilities under quality
assurance programs, the
appointment of temporary
management, and other
activities approved by the
Secretary).
``(VIII) Procedure.--The provisions
of section 1128A (other than
subsections (a) and (b) and except to
the extent that such provisions require
a hearing prior to the imposition of a
civil money penalty) shall apply to a
civil money penalty under this clause
in the same manner as such provisions
apply to a penalty or proceeding under
section 1128A(a).''.
(2) Conforming amendment.--The second sentence of section
1819(h)(5) of the Social Security Act (42 U.S.C. 1395i-3(h)(5))
is amended by inserting ``(ii),''after ``(i),''.
(b) Nursing Facilities.--
(1) Penalties imposed by the state.--
(A) In general.--Section 1919(h)(2) of the Social
Security Act (42 U.S.C. 1396r(h)(2)) is amended--
(i) in subparagraph (A)(ii), by striking the
first sentence and inserting the following: ``A
civil money penalty in accordance with
subparagraph (G).''; and
(ii) by adding at the end the following new
subparagraph:
``(G) Civil money penalties.--
``(i) In general.--The State may impose a
civil money penalty under subparagraph (A)(ii)
in the applicable per instance or per day
amount (as defined in subclause (II) and (III))
for each day or instance, respectively, of
noncompliance (as determined appropriate by the
Secretary).
``(ii) Applicable per instance amount.--In
this subparagraph, the term `applicable per
instance amount' means--
``(I) in the case where the
deficiency is found to be a direct
proximate cause of death of a resident
of the facility, an amount not to
exceed $100,000.
``(II) in each case of a deficiency
where the facility is cited for actual
harm or immediate jeopardy, an amount
not less than $3,050 and not more than
$25,000; and
``(III) in each case of any other
deficiency, an amount not less than
$250 and not to exceed $3050.
``(iii) Applicable per day amount.--In this
subparagraph, the term `applicable per day
amount' means--
``(I) in each case of a deficiency
where the facility is cited for actual
harm or immediate jeopardy, an amount
not less than $3,050 and not more than
$25,000 and
``(II) in each case of any other
deficiency, an amount not less than
$250 and not to exceed $3,050.
``(iv) Reduction of civil money penalties in
certain circumstances.--Subject to clauses (v)
and (vi), in the case where a facility self-
reports and promptly corrects a deficiency for
which a penalty was imposed under subparagraph
(A)(ii) not later than 10 calendar days after
the date of such imposition, the State may
reduce the amount of the penalty imposed by not
more than 50 percent.
``(v) Prohibition on reduction for certain
deficiencies.--
``(I) Repeat deficiencies.--The State
may not reduce under clause (iv) the
amount of a penalty if the State had
reduced a penalty imposed on the
facility in the preceding year under
such clause with respect to a repeat
deficiency.
``(II) Certain other deficiencies.--
The State may not reduce under clause
(iv) the amount of a penalty if the
penalty is imposed for a deficiency
described in clause (ii)(II) or
(iii)(I) and the actual harm or
widespread harm that immediately
jeopardizes the health or safety of a
resident or residents of the facility,
or if the penalty is imposed for a
deficiency described in clause (ii)(I).
``(III) Limitation on aggregate
reductions.--The aggregate reduction in
a penalty under clause (iv) may not
exceed 35 percent on the basis of self-
reporting, on the basis of a waiver or
an appeal (as provided for under
regulations under section 488.436 of
title 42, Code of Federal Regulations),
or on the basis of both.
``(vi) Collection of civil money penalties.--
In the case of a civil money penalty imposed
under subparagraph (A)(ii), the State--
``(I) subject to subclause (III),
shall, not later than 30 days after the
date of imposition of the penalty,
provide the opportunity for the
facility to participate in an
independent informal dispute resolution
process which generates a written
record prior to the collection of such
penalty, but such opportunity shall not
affect the responsibility of the State
survey agency for making final
recommendations for such penalties;
``(II) in the case where the penalty
is imposed for each day of
noncompliance, shall not impose a
penalty for any day during the period
beginning on the initial day of the
imposition of the penalty and ending on
the day on which the informal dispute
resolution process under subclause (I)
is completed;
``(III) may provide for the
collection of such civil money penalty
and the placement of such amounts
collected in an escrow account under
the direction of the State on the
earlier of the date on which the
informal dispute resolution process
under subclause (I) is completed or the
date that is 90 days after the date of
the imposition of the penalty;
``(IV) may provide that such amounts
collected are kept in such account
pending the resolution of any
subsequent appeals;
``(V) in the case where the facility
successfully appeals the penalty, may
provide for the return of such amounts
collected (plus interest) to the
facility; and
``(VI) in the case where all such
appeals are unsuccessful, may provide
that such funds collected shall be used
for the purposes described in the
second sentence of subparagraph
(A)(ii).''.
(B) Conforming amendment.--The second sentence of
section 1919(h)(2)(A)(ii) of the Social Security Act
(42 U.S.C. 1396r(h)(2)(A)(ii)) is amended by inserting
before the period at the end the following: ``, and
some portion of such funds may be used to support
activities that benefit residents, including assistance
to support and protect residents of a facility that
closes (voluntarily or involuntarily) or is decertified
(including offsetting costs of relocating residents to
home and community-based settings or another facility),
projects that support resident and family councils and
other consumer involvement in assuring quality care in
facilities, and facility improvement initiatives
approved by the Secretary (including joint training of
facility staff and surveyors, providing technical
assistance to facilities under quality assurance
programs, the appointment of temporary management, and
other activities approved by the Secretary)''.
(2) Penalties imposed by the secretary.--
(A) In general.--Section 1919(h)(3)(C)(ii) of the
Social Security Act (42 U.S.C. 1396r(h)(3)(C)) is
amended to read as follows:
``(ii) Authority with respect to civil money
penalties.--
``(I) Amount.--Subject to subclause
(II), the Secretary may impose a civil
money penalty in an amount not to
exceed $10,000 for each day or each
instance of noncompliance (as
determined appropriate by the
Secretary).
``(II) Reduction of civil money
penalties in certain circumstances.--
Subject to subclause (III), in the case
where a facility self-reports and
promptly corrects a deficiency for
which a penalty was imposed under this
clause not later than 10 calendar days
after the date of such imposition, the
Secretary may reduce the amount of the
penalty imposed by not more than 50
percent.
``(III) Prohibition on reduction for
repeat deficiencies.--The Secretary may
not reduce the amount of a penalty
under subclause (II) if the Secretary
had reduced a penalty imposed on the
facility in the preceding year under
such subclause with respect to a repeat
deficiency.
``(IV) Collection of civil money
penalties.--In the case of a civil
money penalty imposed under this
clause, the Secretary--
``(aa) subject to item (bb),
shall, not later than 30 days
after the date of imposition of
the penalty, provide the
opportunity for the facility to
participate in an independent
informal dispute resolution
process which generates a
written record prior to the
collection of such penalty;
``(bb) in the case where the
penalty is imposed for each day
of noncompliance, shall not
impose a penalty for any day
during the period beginning on
the initial day of the
imposition of the penalty and
ending on the day on which the
informal dispute resolution
process under item (aa) is
completed;
``(cc) may provide for the
collection of such civil money
penalty and the placement of
such amounts collected in an
escrow account under the
direction of the Secretary on
the earlier of the date on
which the informal dispute
resolution process under item
(aa) is completed or the date
that is 90 days after the date
of the imposition of the
penalty;
``(dd) may provide that such
amounts collected are kept in
such account pending the
resolution of any subsequent
appeals;
``(ee) in the case where the
facility successfully appeals
the penalty, may provide for
the return of such amounts
collected (plus interest) to
the facility; and
``(ff) in the case where all
such appeals are unsuccessful,
may provide that some portion
of such amounts collected may
be used to support activities
that benefit residents,
including assistance to support
and protect residents of a
facility that closes
(voluntarily or involuntarily)
or is decertified (including
offsetting costs of relocating
residents to home and
community-based settings or
another facility), projects
that support resident and
family councils and other
consumer involvement in
assuring quality care in
facilities, and facility
improvement initiatives
approved by the Secretary
(including joint training of
facility staff and surveyors,
technical assistance for
facilities under quality
assurance programs, the
appointment of temporary
management, and other
activities approved by the
Secretary).
``(V) Procedure.--The provisions of
section 1128A (other than subsections
(a) and (b) and except to the extent
that such provisions require a hearing
prior to the imposition of a civil
money penalty) shall apply to a civil
money penalty under this clause in the
same manner as such provisions apply to
a penalty or proceeding under section
1128A(a).''.
(B) Conforming amendment.--Section 1919(h)(8) of the
Social Security Act (42 U.S.C. 1396r(h)(5)(8)) is
amended by inserting ``and in paragraph (3)(C)(ii)''
after ``paragraph (2)(A)''.
(c) Effective Date.--The amendments made by this section shall take
effect 1 year after the date of the enactment of this Act.
SEC. 1422. NATIONAL INDEPENDENT MONITOR PILOT PROGRAM.
(a) Establishment.--
(1) In general.--The Secretary, in consultation with the
Inspector General of the Department of Health and Human
Services, shall establish a pilot program (in this section
referred to as the ``pilot program'') to develop, test, and
implement use of an independent monitor to oversee interstate
and large intrastate chains of skilled nursing facilities and
nursing facilities.
(2) Selection.--The Secretary shall select chains of skilled
nursing facilities and nursing facilities described in
paragraph (1) to participate in the pilot program from among
those chains that submit an application to the Secretary at
such time, in such manner, and containing such information as
the Secretary may require.
(3) Duration.--The Secretary shall conduct the pilot program
for a two-year period.
(4) Implementation.--The Secretary shall implement the pilot
program not later than one year after the date of the enactment
of this Act.
(b) Requirements.--The Secretary shall evaluate chains selected to
participate in the pilot program based on criteria selected by the
Secretary, including where evidence suggests that one or more
facilities of the chain are experiencing serious safety and quality of
care problems. Such criteria may include the evaluation of a chain that
includes one or more facilities participating in the ``Special Focus
Facility'' program (or a successor program) or one or more facilities
with a record of repeated serious safety and quality of care
deficiencies.
(c) Responsibilities of the Independent Monitor.--An independent
monitor that enters into a contract with the Secretary to participate
in the conduct of such program shall--
(1) conduct periodic reviews and prepare root-cause quality
and deficiency analyses of a chain to assess if facilities of
the chain are in compliance with State and Federal laws and
regulations applicable to the facilities;
(2) undertake sustained oversight of the chain, whether
publicly or privately held, to involve the owners of the chain
and the principal business partners of such owners in
facilitating compliance by facilities of the chain with State
and Federal laws and regulations applicable to the facilities;
(3) analyze the management structure, distribution of
expenditures, and nurse staffing levels of facilities of the
chain in relation to resident census, staff turnover rates, and
tenure;
(4) report findings and recommendations with respect to such
reviews, analyses, and oversight to the chain and facilities of
the chain, to the Secretary and to relevant States; and
(5) publish the results of such reviews, analyses, and
oversight.
(d) Implementation of Recommendations.--
(1) Receipt of finding by chain.--Not later than 10 days
after receipt of a finding of an independent monitor under
subsection (c)(4), a chain participating in the pilot program
shall submit to the independent monitor a report--
(A) outlining corrective actions the chain will take
to implement the recommendations in such report; or
(B) indicating that the chain will not implement such
recommendations and why it will not do so.
(2) Receipt of report by independent monitor.--Not later than
10 days after the date of receipt of a report submitted by a
chain under paragraph (1), an independent monitor shall
finalize its recommendations and submit a report to the chain
and facilities of the chain, the Secretary, and the State (or
States) involved, as appropriate, containing such final
recommendations.
(e) Cost of Appointment.--A chain shall be responsible for a portion
of the costs associated with the appointment of independent monitors
under the pilot program. The chain shall pay such portion to the
Secretary (in an amount and in accordance with procedures established
by the Secretary).
(f) Waiver Authority.--The Secretary may waive such requirements of
titles XVIII and XIX of the Social Security Act (42 U.S.C. 1395 et
seq.; 1396 et seq.) as may be necessary for the purpose of carrying out
the pilot program.
(g) Authorization of Appropriations.--There are authorized to be
appropriated such sums as may be necessary to carry out this section.
(h) Definitions.--In this section:
(1) Facility.--The term ``facility'' means a skilled nursing
facility or a nursing facility.
(2) Nursing facility.--The term ``nursing facility'' has the
meaning given such term in section 1919(a) of the Social
Security Act (42 U.S.C. 1396r(a)).
(3) Secretary.--The term ``Secretary'' means the Secretary of
Health and Human Services, acting through the Assistant
Secretary for Planning and Evaluation.
(4) Skilled nursing facility.--The term ``skilled nursing
facility'' has the meaning given such term in section 1819(a)
of the Social Security Act (42 U.S.C. 1395(a)).
(i) Evaluation and Report.--
(1) Evaluation.--The Inspector General of the Department of
Health and Human Services shall evaluate the pilot program.
Such evaluation shall--
(A) determine whether the independent monitor program
should be established on a permanent basis; and
(B) if the Inspector General determines that the
independent monitor program should be established on a
permanent basis, recommend appropriate procedures and
mechanisms for such establishment.
(2) Report.--Not later than 180 days after the completion of
the pilot program, the Inspector General shall submit to
Congress and the Secretary a report containing the results of
the evaluation conducted under paragraph (1), together with
recommendations for such legislation and administrative action
as the Inspector General determines appropriate.
SEC. 1423. NOTIFICATION OF FACILITY CLOSURE.
(a) Skilled Nursing Facilities.--
(1) In general.--Section 1819(c) of the Social Security Act
(42 U.S.C. 1395i-3(c)) is amended by adding at the end the
following new paragraph:
``(7) Notification of facility closure.--
``(A) In general.--Any individual who is the
administrator of a skilled nursing facility must--
``(i) submit to the Secretary, the State
long-term care ombudsman, residents of the
facility, and the legal representatives of such
residents or other responsible parties, written
notification of an impending closure--
``(I) subject to subclause (II), not
later than the date that is 60 days
prior to the date of such closure; and
``(II) in the case of a facility
where the Secretary terminates the
facility's participation under this
title, not later than the date that the
Secretary determines appropriate;
``(ii) ensure that the facility does not
admit any new residents on or after the date on
which such written notification is submitted;
and
``(iii) include in the notice a plan for the
transfer and adequate relocation of the
residents of the facility by a specified date
prior to closure that has been approved by the
State, including assurances that the residents
will be transferred to the most appropriate
facility or other setting in terms of quality,
services, and location, taking into
consideration the needs and best interests of
each resident.
``(B) Relocation.--
``(i) In general.--The State shall ensure
that, before a facility closes, all residents
of the facility have been successfully
relocated to another facility or an alternative
home and community-based setting.
``(ii) Continuation of payments until
residents relocated.--The Secretary may, as the
Secretary determines appropriate, continue to
make payments under this title with respect to
residents of a facility that has submitted a
notification under subparagraph (A) during the
period beginning on the date such notification
is submitted and ending on the date on which
the resident is successfully relocated.''.
(2) Conforming amendments.--Section 1819(h)(4) of the Social
Security Act (42 U.S.C. 1395i-3(h)(4)) is amended--
(A) in the first sentence, by striking ``the
Secretary shall terminate'' and inserting ``the
Secretary, subject to subsection (c)(7), shall
terminate''; and
(B) in the second sentence, by striking ``subsection
(c)(2)'' and inserting ``paragraphs (2) and (7) of
subsection (c)''.
(b) Nursing Facilities.--
(1) In general.--Section 1919(c) of the Social Security Act
(42 U.S.C. 1396r(c)) is amended by adding at the end the
following new paragraph:
``(9) Notification of facility closure.--
``(A) In general.--Any individual who is an
administrator of a nursing facility must--
``(i) submit to the Secretary, the State
long-term care ombudsman, residents of the
facility, and the legal representatives of such
residents or other responsible parties, written
notification of an impending closure--
``(I) subject to subclause (II), not
later than the date that is 60 days
prior to the date of such closure; and
``(II) in the case of a facility
where the Secretary terminates the
facility's participation under this
title, not later than the date that the
Secretary determines appropriate;
``(ii) ensure that the facility does not
admit any new residents on or after the date on
which such written notification is submitted;
and
``(iii) include in the notice a plan for the
transfer and adequate relocation of the
residents of the facility by a specified date
prior to closure that has been approved by the
State, including assurances that the residents
will be transferred to the most appropriate
facility or other setting in terms of quality,
services, and location, taking into
consideration the needs and best interests of
each resident.
``(B) Relocation.--
``(i) In general.--The State shall ensure
that, before a facility closes, all residents
of the facility have been successfully
relocated to another facility or an alternative
home and community-based setting.
``(ii) Continuation of payments until
residents relocated.--The Secretary may, as the
Secretary determines appropriate, continue to
make payments under this title with respect to
residents of a facility that has submitted a
notification under subparagraph (A) during the
period beginning on the date such notification
is submitted and ending on the date on which
the resident is successfully relocated.''.
(c) Effective Date.--The amendments made by this section shall take
effect 1 year after the date of the enactment of this Act.
PART 3--IMPROVING STAFF TRAINING
SEC. 1431. DEMENTIA AND ABUSE PREVENTION TRAINING.
(a) Skilled Nursing Facilities.--Section 1819(f)(2)(A)(i)(I) of the
Social Security Act (42 U.S.C. 1395i-3(f)(2)(A)(i)(I)) is amended by
inserting ``(including, in the case of initial training and, if the
Secretary determines appropriate, in the case of ongoing training,
dementia management training and resident abuse prevention training)''
after ``curriculum''.
(b) Nursing Facilities.--Section 1919(f)(2)(A)(i)(I) of the Social
Security Act (42 U.S.C. 1396r(f)(2)(A)(i)(I)) is amended by inserting
``(including, in the case of initial training and, if the Secretary
determines appropriate, in the case of ongoing training, dementia
management training and resident abuse prevention training)'' after
``curriculum''.
(c) Effective Date.--The amendments made by this section shall take
effect 1 year after the date of the enactment of this Act.
SEC. 1432. STUDY AND REPORT ON TRAINING REQUIRED FOR CERTIFIED NURSE
AIDES AND SUPERVISORY STAFF.
(a) Study.--
(1) In general.--The Secretary shall conduct a study on the
content of training for certified nurse aides and supervisory
staff of skilled nursing facilities and nursing facilities. The
study shall include an analysis of the following:
(A) Whether the number of initial training hours for
certified nurse aides required under sections
1819(f)(2)(A)(i)(II) and 1919(f)(2)(A)(i)(II) of the
Social Security Act (42 U.S.C. 1395i-3(f)(2)(A)(i)(II);
1396r(f)(2)(A)(i)(II)) should be increased from 75 and,
if so, what the required number of initial training
hours should be, including any recommendations for the
content of such training (including training related to
dementia).
(B) Whether requirements for ongoing training under
such sections 1819(f)(2)(A)(i)(II) and
1919(f)(2)(A)(i)(II) should be increased from 12 hours
per year, including any recommendations for the content
of such training.
(2) Consultation.--In conducting the analysis under paragraph
(1)(A), the Secretary shall consult with States that, as of the
date of the enactment of this Act, require more than 75 hours
of training for certified nurse aides.
(3) Definitions.--In this section:
(A) Nursing facility.--The term ``nursing facility''
has the meaning given such term in section 1919(a) of
the Social Security Act (42 U.S.C. 1396r(a)).
(B) Secretary.--The term ``Secretary'' means the
Secretary of Health and Human Services, acting through
the Assistant Secretary for Planning and Evaluation.
(C) Skilled nursing facility.--The term ``skilled
nursing facility'' has the meaning given such term in
section 1819(a) of the Social Security Act (42 U.S.C.
1395(a)).
(b) Report.--Not later than 2 years after the date of the enactment
of this Act, the Secretary shall submit to Congress a report containing
the results of the study conducted under subsection (a), together with
recommendations for such legislation and administrative action as the
Secretary determines appropriate.
SEC. 1433. QUALIFICATION OF DIRECTOR OF FOOD SERVICES OF A MEDICAID
NURSING FACILITY.
(a) In General.--Section 1919(b)(4)(A) of the Social Security Act (42
U.S.C. 1396r(b)(4)(A)) is amended by adding at the end the following:
``With respect to meeting the staffing requirement imposed by the
Secretary to carry out clause (iv), the full-time director of food
services of the facility, if not a qualified dietitian (as defined in
section 483.35(a)(2) of title 42, Code of Federal Regulations, as in
effect as of the date of the enactment of this section), shall be a
Certified Dietary Manager meeting the requirements of the Certifying
Board for Dietary Managers, or a Dietetic Technician, Registered
meeting the requirements of the Commission on Dietetic Registration or
have equivalent military or academic qualifications (as specified by
the Secretary).''.
(b) Effective Date.--The amendment made by subsection (a) shall take
effect on the date that is 180 days after the date of enactment of this
Act.
Subtitle C--Quality Measurements
SEC. 1441. ESTABLISHMENT OF NATIONAL PRIORITIES FOR QUALITY
IMPROVEMENT.
Title XI of the Social Security Act, as amended by section 1401(a),
is further amended by adding at the end the following new part:
``Part E--Quality Improvement
``establishment of national priorities for performance improvement
``Sec. 1191. (a) Establishment of National Priorities by the
Secretary.--The Secretary shall establish and periodically update, not
less frequently than triennially, national priorities for performance
improvement.
``(b) Recommendations for National Priorities.--In establishing and
updating national priorities under subsection (a), the Secretary shall
solicit and consider recommendations from multiple outside
stakeholders.
``(c) Considerations in Setting National Priorities.--With respect to
such priorities, the Secretary shall ensure that priority is given to
areas in the delivery of health care services in the United States
that--
``(1) contribute to a large burden of disease, including
those that address the health care provided to patients with
prevalent, high-cost chronic diseases;
``(2) have the greatest potential to decrease morbidity and
mortality in this country, including those that are designed to
eliminate harm to patients;
``(3) have the greatest potential for improving the
performance, affordability, and patient-centeredness of health
care, including those due to variations in care;
``(4) address health disparities across groups and areas; and
``(5) have the potential for rapid improvement due to
existing evidence, standards of care or other reasons.
``(d) Definitions.--In this part:
``(1) Consensus-based entity.--The term `consensus-based
entity' means an entity with a contract with the Secretary
under section 1890.
``(2) Quality measure.--The term `quality measure' means a
national consensus standard for measuring the performance and
improvement of population health, or of institutional providers
of services, physicians, and other health care practitioners in
the delivery of health care services.
``(e) Funding.--
``(1) In general.--The Secretary shall provide for the
transfer, from 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 appropriate), of $2,000,000, for the
activities under this section for each of the fiscal years 2010
through 2014.
``(2) Authorization of appropriations.--For purposes of
carrying out the provisions of this section, in addition to
funds otherwise available, out of any funds in the Treasury not
otherwise appropriated, there are appropriated to the Secretary
of Health and Human Services $2,000,000 for each of the fiscal
years 2010 through 2014.''.
SEC. 1442. DEVELOPMENT OF NEW QUALITY MEASURES; GAO EVALUATION OF DATA
COLLECTION PROCESS FOR QUALITY MEASUREMENT.
Part E of title XI of the Social Security Act, as added by section
1441, is amended by adding at the end the following new sections:
``SEC. 1192. DEVELOPMENT OF NEW QUALITY MEASURES.
``(a) Agreements With Qualified Entities.--
``(1) In general.--The Secretary shall enter into agreements
with qualified entities to develop quality measures for the
delivery of health care services in the United States.
``(2) Form of agreements.--The Secretary may carry out
paragraph (1) by contract, grant, or otherwise.
``(3) Recommendations of consensus-based entity.--In carrying
out this section, the Secretary shall--
``(A) seek public input; and
``(B) take into consideration recommendations of the
consensus-based entity with a contract with the
Secretary under section 1890(a).
``(b) Determination of Areas Where Quality Measures Are Required.--
Consistent with the national priorities established under this part and
with the programs administered by the Centers for Medicare & Medicaid
Services and in consultation with other relevant Federal agencies, the
Secretary shall determine areas in which quality measures for assessing
health care services in the United States are needed.
``(c) Development of Quality Measures.--
``(1) Patient-centered and population-based measures.--
Quality measures developed under agreements under subsection
(a) shall be designed--
``(A) to assess outcomes, presence of impairment, and
functional status of patients;
``(B) to assess the continuity and coordination of
care and care transitions for patients across providers
and health care settings, including end of life care;
``(C) to assess patient experience and patient
engagement;
``(D) to assess the safety, effectiveness, and
timeliness of care;
``(E) to assess health disparities including those
associated with individual race, ethnicity, age,
gender, place of residence or language;
``(F) to assess the efficiency and resource use in
the provision of care;
``(G) to the extent feasible, to be collected as part
of health information technologies supporting better
delivery of health care services;
``(H) to be available free of charge to users for the
use of such measures; and
``(I) to assess delivery of health care services to
individuals regardless of age.
``(2) Availability of measures.--The Secretary shall make
quality measures developed under this section available to the
public.
``(3) Testing of proposed measures.--The Secretary may use
amounts made available under subsection (f) to fund the testing
of proposed quality measures by qualified entities. Testing
funded under this paragraph shall include testing of the
feasibility and usability of proposed measures.
``(4) Updating of endorsed measures.--The Secretary may use
amounts made available under subsection (f) to fund the
updating (and testing, if applicable) by consensus-based
entities of quality measures that have been previously endorsed
by such an entity as new evidence is developed, in a manner
consistent with section 1890(b)(3).
``(d) Qualified Entities.--Before entering into agreements with a
qualified entity, the Secretary shall ensure that the entity is a
public, nonprofit or academic institution with technical expertise in
the area of health quality measurement.
``(e) Application for Grant.--A grant may be made under this section
only if an application for the grant is submitted to the Secretary and
the application is in such form, is made in such manner, and contains
such agreements, assurances, and information as the Secretary
determines to be necessary to carry out this section.
``(f) Funding.--
``(1) In general.--The Secretary shall provide for the
transfer, from 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 appropriate), of $25,000,000, to the
Secretary for purposes of carrying out this section for each of
the fiscal years 2010 through 2014.
``(2) Authorization of appropriations.--For purposes of
carrying out the provisions of this section, in addition to
funds otherwise available, out of any funds in the Treasury not
otherwise appropriated, there are appropriated to the Secretary
of Health and Human Services $25,000,000 for each of the fiscal
years 2010 through 2014.
``SEC. 1193. GAO EVALUATION OF DATA COLLECTION PROCESS FOR QUALITY
MEASUREMENT.
``(a) GAO Evaluations.--The Comptroller General of the United States
shall conduct periodic evaluations of the implementation of the data
collection processes for quality measures used by the Secretary.
``(b) Considerations.--In carrying out the evaluation under
subsection (a), the Comptroller General shall determine--
``(1) whether the system for the collection of data for
quality measures provides for validation of data as relevant
and scientifically credible;
``(2) whether data collection efforts under the system use
the most efficient and cost-effective means in a manner that
minimizes administrative burden on persons required to collect
data and that adequately protects the privacy of patients'
personal health information and provides data security;
``(3) whether standards under the system provide for an
appropriate opportunity for physicians and other clinicians and
institutional providers of services to review and correct
findings; and
``(4) the extent to which quality measures are consistent
with section 1192(c)(1) or result in direct or indirect costs
to users of such measures.
``(c) Report.--The Comptroller General shall submit reports to
Congress and to the Secretary containing a description of the findings
and conclusions of the results of each such evaluation.''.
SEC. 1443. MULTISTAKEHOLDER PRERULEMAKING INPUT INTO SELECTION OF
QUALITY MEASURES.
Section 1808 of the Social Security Act (42 U.S.C. 1395b-9) is
amended by adding at the end the following new subsection:
``(d) Multi-stakeholder Pre-rulemaking Input Into Selection of
Quality Measures.--
``(1) List of measures.--Not later than December 1 before
each year (beginning with 2011), the Secretary shall make
public a list of measures being considered for selection for
quality measurement by the Secretary in rulemaking with respect
to payment systems under this title beginning in the payment
year beginning in such year and for payment systems beginning
in the calendar year following such year, as the case may be.
``(2) Consultation on selection of endorsed quality
measures.--A consensus-based entity that has entered into a
contract under section 1890 shall, as part of such contract,
convene multi-stakeholder groups to provide recommendations on
the selection of individual or composite quality measures, for
use in reporting performance information to the public or for
use in public health care programs.
``(3) Multi-stakeholder input.--Not later than February 1 of
each year (beginning with 2011), the consensus-based entity
described in paragraph (2) shall transmit to the Secretary the
recommendations of multi-stakeholder groups provided under
paragraph (2). Such recommendations shall be included in the
transmissions the consensus-based entity makes to the Secretary
under the contract provided for under section 1890.
``(4) Requirement for transparency in process.--
``(A) In general.--In convening multi-stakeholder
groups under paragraph (2) with respect to the
selection of quality measures, the consensus-based
entity described in such paragraph shall provide for an
open and transparent process for the activities
conducted pursuant to such convening.
``(B) Selection of organizations participating in
multi-stakeholder groups.--The process under paragraph
(2) shall ensure that the selection of representatives
of multi-stakeholder groups includes provision for
public nominations for, and the opportunity for public
comment on, such selection.
``(5) Use of input.--The respective proposed rule shall
contain a summary of the recommendations made by the multi-
stakeholder groups under paragraph (2), as well as other
comments received regarding the proposed measures, and the
extent to which such proposed rule follows such recommendations
and the rationale for not following such recommendations.
``(6) Multi-stakeholder groups.--For purposes of this
subsection, the term `multi-stakeholder groups' means, with
respect to a quality measure, a voluntary collaborative of
organizations representing persons interested in or affected by
the use of such quality measure, such as the following:
``(A) Hospitals and other institutional providers.
``(B) Physicians.
``(C) Health care quality alliances.
``(D) Nurses and other health care practitioners.
``(E) Health plans.
``(F) Patient advocates and consumer groups.
``(G) Employers.
``(H) Public and private purchasers of health care
items and services.
``(I) Labor organizations.
``(J) Relevant departments or agencies of the United
States.
``(K) Biopharmaceutical companies and manufacturers
of medical devices.
``(L) Licensing, credentialing, and accrediting
bodies.
``(7) Funding.--
``(A) In general.--The Secretary shall provide for
the transfer, from 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
appropriate), of $1,000,000, to the Secretary for
purposes of carrying out this subsection for each of
the fiscal years 2010 through 2014.
``(B) Authorization of appropriations.--For purposes
of carrying out the provisions of this subsection, in
addition to funds otherwise available, out of any funds
in the Treasury not otherwise appropriated, there are
appropriated to the Secretary of Health and Human
Services $1,000,000 for each of the fiscal years 2010
through 2014.''.
SEC. 1444. APPLICATION OF QUALITY MEASURES.
(a) Inpatient Hospital Services.--Section 1886(b)(3)(B) of such Act
(42 U.S.C. 1395ww(b)(3)(B)) is amended by adding at the end the
following new clause:
``(x)(I) Subject to subclause (II), for purposes of reporting data on
quality measures for inpatient hospital services furnished during
fiscal year 2012 and each subsequent fiscal year, the quality measures
specified under clause (viii) shall be measures selected by the
Secretary from measures that have been endorsed by the entity with a
contract with the Secretary under section 1890(a).
``(II) In the case of a specified area or medical topic determined
appropriate by the Secretary for which a feasible and practical quality
measure has not been endorsed by the entity with a contract under
section 1890(a), the Secretary may specify a measure that is not so
endorsed as long as due consideration is given to measures that have
been endorsed or adopted by a consensus organization identified by the
Secretary. The Secretary shall submit such a non-endorsed measure to
the entity for consideration for endorsement. If the entity considers
but does not endorse such a measure and if the Secretary does not
phase-out use of such measure, the Secretary shall include the
rationale for continued use of such a measure in rulemaking.''.
(b) Outpatient Hospital Services.--Section 1833(t)(17) of such Act
(42 U.S.C. 1395l(t)(17)) is amended by adding at the end the following
new subparagraph:
``(F) Use of endorsed quality measures.--The
provisions of clause (x) of section 1886(b)(3)(C) shall
apply to quality measures for covered OPD services
under this paragraph in the same manner as such
provisions apply to quality measures for inpatient
hospital services.''.
(c) Physicians' Services.--Section 1848(k)(2)(C)(ii) of such Act (42
U.S.C. 1395w-4(k)(2)(C)(ii)) is amended by adding at the end the
following: ``The Secretary shall submit such a non-endorsed measure to
the entity for consideration for endorsement. If the entity considers
but does not endorse such a measure and if the Secretary does not
phase-out use of such measure, the Secretary shall include the
rationale for continued use of such a measure in rulemaking.''.
(d) Renal Dialysis Services.--Section 1881(h)(2)(B)(ii) of such Act
(42 U.S.C. 1395rr(h)(2)(B)(ii)) is amended by adding at the end the
following: ``The Secretary shall submit such a non-endorsed measure to
the entity for consideration for endorsement. If the entity considers
but does not endorse such a measure and if the Secretary does not
phase-out use of such measure, the Secretary shall include the
rationale for continued use of such a measure in rulemaking.''.
(e) Endorsement of Standards.--Section 1890(b)(2) of the Social
Security Act (42 U.S.C. 1395aaa(b)(2)) is amended by adding after and
below subparagraph (B) the following:
``If the entity does not endorse a measure, such entity shall
explain the reasons and provide suggestions about changes to
such measure that might make it a potentially endorsable
measure.''.
(f) Effective Date.--Except as otherwise provided, the amendments
made by this section shall apply to quality measures applied for
payment years beginning with 2012 or fiscal year 2012, as the case may
be.
SEC. 1445. CONSENSUS-BASED ENTITY FUNDING.
Section 1890(d) of the Social Security Act (42 U.S.C. 1395aaa(d)) is
amended by striking ``for each of fiscal years 2009 through 2012'' and
inserting ``for fiscal year 2009, and $12,000,000 for each of the
fiscal years 2010 through 2012''.
SEC. 1446. QUALITY INDICATORS FOR CARE OF PEOPLE WITH ALZHEIMER'S
DISEASE.
(a) Quality Indicators.--The Secretary of Health and Human Services,
acting through the Agency for Healthcare Research and Quality (AHRQ),
shall develop, either directly or with commissioned projects, a core
set of quality indicators for the provision of medical services to
people with Alzheimer's disease and other dementias and a plan for
implementing the indicators to measure the quality of care provided for
people with these conditions by physicians, hospitals, and other
medical, residential and home care agencies and providers.
(b) Report.--The Secretary shall submit a report to the Committees on
Energy and Commerce and Ways and Means of the United States House of
Representatives and to the Committees on Finance and Health, Education,
and Pensions of the United States Senate not later than 12 months after
the date of the enactment of this Act setting forth the status of their
efforts to implement the requirements of subsection (a).
SEC. 1447. STUDY ON FIVE STAR QUALITY RATING SYSTEM.
(a) Study.--The Comptroller General of the United States shall
conduct a study on the Five-Star Quality Rating System (or a
successor program) established by the Centers for Medicare & Medicaid
Services. The study shall--
(1) determine whether the composite star rating should be
eliminated in favor of a multi-dimensional system under which a
star rating is assigned to each individual domain;
(2) determine whether an appeals process should be
implemented for the Five Star Rating System to address
situations in which questionable, inaccurate, or incomplete
data has been identified;
(3) evaluate the appropriateness of any weighting methodology
used to adjust quality measures, including an assessment of
whether such methodology is validated, whether it takes into
account resident characteristics, the appropriateness of the
weighting of individual quality measures, and whether the
accuracy of information to consumers would be enhanced if the
standard survey were weighted more heavily than the complaint
survey;
(4) assess the appropriateness of the case-mix adjustment
methodology used to evaluate staffing levels, along with the
appropriateness of the staffing levels established by the
Centers for Medicare & Medicaid Services to achieve a 5-star
rating given the absence of any existing Federal nursing home
staffing guidelines or Medicare funding to support these
staffing levels;
(5) if the Comptroller General determines that such target
staffing levels are appropriate, evaluate, in consultation with
the Secretary of Health and Human Services, the cost of
modifying the Medicare Skilled Nursing Facility Resource
Utilization Groups to reflect the costs to facilities of
providing staffing at these target levels;
(6) evaluate how best to represent resident/consumer
satisfaction under the rating system, and review approaches to
report other facility-specific characteristics to enable
consumers to better identify facilities that will meet their
individual needs;
(7) evaluate the impact of the rating system on Medicare
skilled nursing facilities and Medicaid nursing facilities,
including a review of potential problems associated with
inaccurate or incomplete data and other unanticipated
consequences reported by facilities; and
(8) assess whether the national program should be suspended
and replaced with a pilot program testing potential nursing
home quality rating systems in a limited number of States.
(b) Report.--Not later than 1 year after the date of the enactment of
this Act, the Comptroller General of the United States shall submit to
Congress and the Secretary of Health and Human Services a report
containing the results of the study conducted under subsection (a),
together with recommendations for such modifications to the Five-Star
Quality Rating System as the Comptroller General determines
appropriate.
Subtitle D--Physician Payments Sunshine Provision
SEC. 1451. REPORTS ON FINANCIAL RELATIONSHIPS BETWEEN MANUFACTURERS AND
DISTRIBUTORS OF COVERED DRUGS, DEVICES,
BIOLOGICALS, OR MEDICAL SUPPLIES UNDER MEDICARE,
MEDICAID, OR CHIP AND PHYSICIANS AND OTHER HEALTH
CARE ENTITIES AND BETWEEN PHYSICIANS AND OTHER
HEALTH CARE ENTITIES.
(a) In General.--Part A of title XI of the Social Security Act (42
U.S.C. 1301 et seq.), as amended by section 1631(a), is further amended
by inserting after section 1128G the following new section:
``SEC. 1128H. FINANCIAL REPORTS ON PHYSICIANS' FINANCIAL RELATIONSHIPS
WITH MANUFACTURERS AND DISTRIBUTORS OF COVERED
DRUGS, DEVICES, BIOLOGICALS, OR MEDICAL SUPPLIES
UNDER MEDICARE, MEDICAID, OR CHIP AND WITH ENTITIES
THAT BILL FOR SERVICES UNDER MEDICARE.
``(a) Reporting of Payments or Other Transfers of Value.--
``(1) In general.--Except as provided in this subsection, not
later than March 31, 2011 and annually thereafter, each
applicable manufacturer or distributor that provides a payment
or other transfer of value to a covered recipient, or to an
entity or individual at the request of or designated on behalf
of a covered recipient, shall submit to the Secretary, in such
electronic form as the Secretary shall require, the following
information with respect to the preceding calendar year:
``(A) With respect to the covered recipient, the
recipient's name, business address, physician
specialty, and national provider identifier.
``(B) With respect to the payment or other transfer
of value, other than a drug sample--
``(i) its value and date;
``(ii) the name of the related drug, device,
or supply, if available; and
``(iii) a description of its form, indicated
(as appropriate for all that apply) as--
``(I) cash or a cash equivalent;
``(II) in-kind items or services;
``(III) stock, a stock option, or any
other ownership interest, dividend,
profit, or other return on investment;
or
``(IV) any other form (as defined by
the Secretary).
``(C) With respect to a drug sample, the name,
number, date, and dosage units of the sample.
``(2) Aggregate reporting.--Information submitted by an
applicable manufacturer or distributor under paragraph (1)
shall include the aggregate amount of all payments or other
transfers of value provided by the manufacturer or distributor
to covered recipients (and to entities or individuals at the
request of or designated on behalf of a covered recipient)
during the year involved, including all payments and transfers
of value regardless of whether such payments or transfer of
value were individually disclosed.
``(3) Special rule for certain payments or other transfers of
value.--In the case where an applicable manufacturer or
distributor provides a payment or other transfer of value to an
entity or individual at the request of or designated on behalf
of a covered recipient, the manufacturer or distributor shall
disclose that payment or other transfer of value under the name
of the covered recipient.
``(4) Delayed reporting for payments made pursuant to product
development agreements.--In the case of a payment or other
transfer of value made to a covered recipient by an applicable
manufacturer or distributor pursuant to a product development
agreement for services furnished in connection with the
development of a new drug, device, biological, or medical
supply, the applicable manufacturer or distributor may report
the value and recipient of such payment or other transfer of
value in the first reporting period under this subsection in
the next reporting deadline after the earlier of the following:
``(A) The date of the approval or clearance of the
covered drug, device, biological, or medical supply by
the Food and Drug Administration.
``(B) Two calendar years after the date such payment
or other transfer of value was made.
``(5) Delayed reporting for payments made pursuant to
clinical investigations.--In the case of a payment or other
transfer of value made to a covered recipient by an applicable
manufacturer or distributor in connection with a clinical
investigation regarding a new drug, device, biological, or
medical supply, the applicable manufacturer or distributor may
report as required under this section in the next reporting
period under this subsection after the earlier of the
following:
``(A) The date that the clinical investigation is
registered on the website maintained by the National
Institutes of Health pursuant to section 671 of the
Food and Drug Administration Amendments Act of 2007.
``(B) Two calendar years after the date such payment
or other transfer of value was made.
``(6) Confidentiality.--Information described in paragraph
(4) or (5) shall be considered confidential and shall not be
subject to disclosure under section 552 of title 5, United
States Code, or any other similar Federal, State, or local law,
until or after the date on which the information is made
available to the public under such paragraph.
``(b) Reporting of Ownership Interest by Physicians in Hospitals and
Other Entities That Bill Medicare.--Not later than March 31 of each
year (beginning with 2011), each hospital or other health care entity
(not including a Medicare Advantage organization) that bills the
Secretary under part A or part B of title XVIII for services shall
report on the ownership shares (other than ownership shares described
in section 1877(c)) of each physician who, directly or indirectly, owns
an interest in the entity. In this subsection, the term `physician'
includes a physician's immediate family members (as defined for
purposes of section 1877(a)).
``(c) Public Availability.--
``(1) In general.--The Secretary shall establish procedures
to ensure that, not later than September 30, 2011, and on June
30 of each year beginning thereafter, the information submitted
under subsections (a) and (b), other than information regard
drug samples, with respect to the preceding calendar year is
made available through an Internet website that--
``(A) is searchable and is in a format that is clear
and understandable;
``(B) contains information that is presented by the
name of the applicable manufacturer or distributor, the
name of the covered recipient, the business address of
the covered recipient, the specialty (if applicable) of
the covered recipient, the value of the payment or
other transfer of value, the date on which the payment
or other transfer of value was provided to the covered
recipient, the form of the payment or other transfer of
value, indicated (as appropriate) under subsection
(a)(1)(B)(ii), the nature of the payment or other
transfer of value, indicated (as appropriate) under
subsection (a)(1)(B)(iii), and the name of the covered
drug, device, biological, or medical supply, as
applicable;
``(C) contains information that is able to be easily
aggregated and downloaded;
``(D) contains a description of any enforcement
actions taken to carry out this section, including any
penalties imposed under subsection (d), during the
preceding year;
``(E) contains background information on industry-
physician relationships;
``(F) in the case of information submitted with
respect to a payment or other transfer of value
described in subsection (a)(5), lists such information
separately from the other information submitted under
subsection (a) and designates such separately listed
information as funding for clinical research;
``(G) contains any other information the Secretary
determines would be helpful to the average consumer;
and
``(H) provides the covered recipient an opportunity
to submit corrections to the information made available
to the public with respect to the covered recipient.
``(2) Accuracy of reporting.--The accuracy of the information
that is submitted under subsections (a) and (b) and made
available under paragraph (1) shall be the responsibility of
the applicable manufacturer or distributor of a covered drug,
device, biological, or medical supply reporting under
subsection (a) or hospital or other health care entity
reporting physician ownership under subsection (b). The
Secretary shall establish procedures to ensure that the covered
recipient is provided with an opportunity to submit corrections
to the manufacturer, distributor, hospital, or other entity
reporting under subsection (a) or (b) with regard to
information made public with respect to the covered recipient
and, under such procedures, the corrections shall be
transmitted to the Secretary.
``(3) Special rule for drug samples.--Information relating to
drug samples provided under subsection (a) shall not be made
available to the public by the Secretary but may be made
available outside the Department of Health and Human Services
by the Secretary for research or legitimate business purposes
pursuant to data use agreements.
``(4) Special rule for national provider identifiers.--
Information relating to national provider identifiers provided
under subsection (a) shall not be made available to the public
by the Secretary but may be made available outside the
Department of Health and Human Services by the Secretary for
research or legitimate business purposes pursuant to data use
agreements.
``(d) Penalties for Noncompliance.--
``(1) Failure to report.--
``(A) In general.--Subject to subparagraph (B),
except as provided in paragraph (2), any applicable
manufacturer or distributor that fails to submit
information required under subsection (a) in a timely
manner in accordance with regulations promulgated to
carry out such subsection, and any hospital or other
entity that fails to submit information required under
subsection (b) in a timely manner in accordance with
regulations promulgated to carry out such subsection
shall be subject to a civil money penalty of not less
than $1,000, but not more than $10,000, for each
payment or other transfer of value or ownership or
investment interest not reported as required under such
subsection. Such penalty shall be imposed and collected
in the same manner as civil money penalties under
subsection (a) of section 1128A are imposed and
collected under that section.
``(B) Limitation.--The total amount of civil money
penalties imposed under subparagraph (A) with respect
to each annual submission of information under
subsection (a) by an applicable manufacturer or
distributor or other entity shall not exceed $150,000.
``(2) Knowing failure to report.--
``(A) In general.--Subject to subparagraph (B), any
applicable manufacturer or distributor that knowingly
fails to submit information required under subsection
(a) in a timely manner in accordance with regulations
promulgated to carry out such subsection and any
hospital or other entity that fails to submit
information required under subsection (b) in a timely
manner in accordance with regulations promulgated to
carry out such subsection, shall be subject to a civil
money penalty of not less than $10,000, but not more
than $100,000, for each payment or other transfer of
value or ownership or investment interest not reported
as required under such subsection. Such penalty shall
be imposed and collected in the same manner as civil
money penalties under subsection (a) of section 1128A
are imposed and collected under that section.
``(B) Limitation.--The total amount of civil money
penalties imposed under subparagraph (A) with respect
to each annual submission of information under
subsection (a) or (b) by an applicable manufacturer,
distributor, or entity shall not exceed $1,000,000, or,
if greater, 0.1 percentage of the total annual revenues
of the manufacturer, distributor, or entity.
``(3) Use of funds.--Funds collected by the Secretary as a
result of the imposition of a civil money penalty under this
subsection shall be used to carry out this section.
``(4) Enforcement through state attorneys general.--The
attorney general of a State, after providing notice to the
Secretary of an intent to proceed under this paragraph in a
specific case and providing the Secretary with an opportunity
to bring an action under this subsection and the Secretary
declining such opportunity, may proceed under this subsection
against a manufacturer or distributor in the State.
``(e) Annual Report to Congress.--Not later than April 1 of each year
beginning with 2011, the Secretary shall submit to Congress a report
that includes the following:
``(1) The information submitted under this section during the
preceding year, aggregated for each applicable manufacturer or
distributor of a covered drug, device, biological, or medical
supply that submitted such information during such year.
``(2) A description of any enforcement actions taken to carry
out this section, including any penalties imposed under
subsection (d), during the preceding year.
``(f) Definitions.--In this section:
``(1) Applicable manufacturer; applicable distributor.--The
term `applicable manufacturer' means a manufacturer of a
covered drug, device, biological, or medical supply, and the
term `applicable distributor' means a distributor of a covered
drug, device, or medical supply.
``(2) Clinical investigation.--The term `clinical
investigation' means any experiment involving one or more human
subjects, or materials derived from human subjects, in which a
drug or device is administered, dispensed, or used.
``(3) Covered drug, device, biological, or medical supply.--
The term `covered' means, with respect to a drug, device,
biological, or medical supply, such a drug, device, biological,
or medical supply for which payment is available under title
XVIII or a State plan under title XIX or XXI (or a waiver of
such a plan).
``(4) Covered recipient.--The term `covered recipient' means
the following:
``(A) A physician.
``(B) A physician group practice.
``(C) Any other prescriber of a covered drug, device,
biological, or medical supply.
``(D) A pharmacy or pharmacist.
``(E) A health insurance issuer, group health plan,
or other entity offering a health benefits plan,
including any employee of such an issuer, plan, or
entity.
``(F) A pharmacy benefit manager, including any
employee of such a manager.
``(G) A hospital.
``(H) A medical school.
``(I) A sponsor of a continuing medical education
program.
``(J) A patient advocacy or disease specific group.
``(K) A organization of health care professionals.
``(L) A biomedical researcher.
``(M) A group purchasing organization.
``(5) Distributor of a covered drug, device, or medical
supply.--The term `distributor of a covered drug, device, or
medical supply' means any entity which is engaged in the
marketing or distribution of a covered drug, device, or medical
supply (or any subsidiary of or entity affiliated with such
entity), but does not include a wholesale pharmaceutical
distributor.
``(6) Employee.--The term `employee' has the meaning given
such term in section 1877(h)(2).
``(7) Knowingly.--The term `knowingly' has the meaning given
such term in section 3729(b) of title 31, United States Code.
``(8) Manufacturer of a covered drug, device, biological, or
medical supply.--The term `manufacturer of a covered drug,
device, biological, or medical supply' means any entity which
is engaged in the production, preparation, propagation,
compounding, conversion, processing, marketing, or distribution
of a covered drug, device, biological, or medical supply (or
any subsidiary of or entity affiliated with such entity).
``(9) Payment or other transfer of value.--
``(A) In general.--The term `payment or other
transfer of value' means a transfer of anything of
value for or of any of the following:
``(i) Gift, food, or entertainment.
``(ii) Travel or trip.
``(iii) Honoraria.
``(iv) Research funding or grant.
``(v) Education or conference funding.
``(vi) Consulting fees.
``(vii) Ownership or investment interest and
royalties or license fee.
``(B) Inclusions.--Subject to subparagraph (C), the
term `payment or other transfer of value' includes any
compensation, gift, honorarium, speaking fee,
consulting fee, travel, services, dividend, profit
distribution, stock or stock option grant, or any
ownership or investment interest held by a physician in
a manufacturer (excluding a dividend or other profit
distribution from, or ownership or investment interest
in, a publicly traded security or mutual fund (as
described in section 1877(c))).
``(C) Exclusions.--The term `payment or other
transfer of value' does not include the following:
``(i) Any payment or other transfer of value
provided by an applicable manufacturer or
distributor to a covered recipient where the
amount transferred to, requested by, or
designated on behalf of the covered recipient
does not exceed $5.
``(ii) The loan of a covered device for a
short-term trial period, not to exceed 90 days,
to permit evaluation of the covered device by
the covered recipient.
``(iii) Items or services provided under a
contractual warranty, including the replacement
of a covered device, where the terms of the
warranty are set forth in the purchase or lease
agreement for the covered device.
``(iv) A transfer of anything of value to a
covered recipient when the covered recipient is
a patient and not acting in the professional
capacity of a covered recipient.
``(v) In-kind items used for the provision of
charity care.
``(vi) A dividend or other profit
distribution from, or ownership or investment
interest in, a publicly traded security and
mutual fund (as described in section 1877(c)).
``(vii) Compensation paid by a manufacturer
or distributor of a covered drug, device,
biological, or medical supply to a covered
recipient who is directly employed by and works
solely for such manufacturer or distributor.
``(viii) Any discount or cash rebate.
``(10) Physician.--The term `physician' has the meaning given
that term in section 1861(r). For purposes of this section,
such term does not include a physician who is an employee of
the applicable manufacturer that is required to submit
information under subsection (a).
``(g) Annual Reports to States.--Not later than April 1 of each year
beginning with 2011, the Secretary shall submit to States a report that
includes a summary of the information submitted under subsections (a)
and (d) during the preceding year with respect to covered recipients or
other hospitals and entities in the State.
``(h) Relation to State Laws.--
``(1) In general.--Effective on January 1, 2011, subject to
paragraph (2), the provisions of this section shall preempt any
law or regulation of a State or of a political subdivision of a
State that requires an applicable manufacturer and applicable
distributor (as such terms are defined in subsection (f)) to
disclose or report, in any format, the type of information
(described in subsection (a)) regarding a payment or other
transfer of value provided by the manufacturer to a covered
recipient (as so defined).
``(2) No preemption of additional requirements.--Paragraph
(1) shall not preempt any law or regulation of a State or of a
political subdivision of a State that requires any of the
following:
``(A) The disclosure or reporting of information not
of the type required to be disclosed or reported under
this section.
``(B) The disclosure or reporting, in any format, of
the type of information required to be disclosed or
reported under this section to a Federal, State, or
local governmental agency for public health
surveillance, investigation, or other public health
purposes or health oversight purposes.
``(C) The discovery or admissibility of information
described in this section in a criminal, civil, or
administrative proceeding.''.
(b) Availability of Information From the Disclosure of Financial
Relationship Report (DFRR).--The Secretary of Health and Human Services
shall submit to Congress a report on the full results of the Disclosure
of Physician Financial Relationships surveys required pursuant to
section 5006 of the Deficit Reduction Act of 2005. Such report shall be
submitted to Congress not later than the date that is 6 months after
the date such surveys are collected and shall be made publicly
available on an Internet website of the Department of Health and Human
Services.
Subtitle E--Public Reporting on Health Care-Associated Infections
SEC. 1461. REQUIREMENT FOR PUBLIC REPORTING BY HOSPITALS AND AMBULATORY
SURGICAL CENTERS ON HEALTH CARE-ASSOCIATED
INFECTIONS.
(a) In General.--Title XI of the Social Security Act is amended by
inserting after section 1138 the following section:
``SEC. 1138A. REQUIREMENT FOR PUBLIC REPORTING BY HOSPITALS AND
AMBULATORY SURGICAL CENTERS ON HEALTH CARE-
ASSOCIATED INFECTIONS.
``(a) Reporting Requirement.--
``(1) In general.--The Secretary shall provide that a
hospital (as defined in subsection (g)) or ambulatory surgical
center meeting the requirements of titles XVIII or XIX may
participate in the programs established under such titles
(pursuant to the applicable provisions of law, including
sections 1866(a)(1) and 1832(a)(1)(F)(i)) only if, in
accordance with this section, the hospital or center reports
such information on health care-associated infections that
develop in the hospital or center (and such demographic
information associated with such infections) as the Secretary
specifies.
``(2) Reporting protocols.-- Such information shall be
reported in accordance with reporting protocols established by
the Secretary through the Director of the Centers for Disease
Control and Prevention (in this section referred to as the
`CDC') and to the National Healthcare Safety Network of the CDC
or under such another reporting system of such Centers as
determined appropriate by the Secretary in consultation with
such Director.
``(3) Coordination with hit.--The Secretary, through the
Director of the CDC and the Office of the National Coordinator
for Health Information Technology, shall ensure that the
transmission of information under this subsection is
coordinated with systems established under the HITECH Act,
where appropriate.
``(4) Procedures to ensure the validity of information.--The
Secretary shall establish procedures regarding the validity of
the information submitted under this subsection in order to
ensure that such information is appropriately compared across
hospitals and centers. Such procedures shall address failures
to report as well as errors in reporting.
``(5) Implementation.--Not later than 1 year after the date
of enactment of this section, the Secretary, through the
Director of CDC, shall promulgate regulations to carry out this
section.
``(b) Public Posting of Information.--The Secretary shall promptly
post, on the official public Internet site of the Department of Health
and Human Services, the information reported under subsection (a). Such
information shall be set forth in a manner that allows for the
comparison of information on health care-associated infections--
``(1) among hospitals and ambulatory surgical centers; and
``(2) by demographic information.
``(c) Annual Report to Congress.--On an annual basis the Secretary
shall submit to the Congress a report that summarizes each of the
following:
``(1) The number and types of health care-associated
infections reported under subsection (a) in hospitals and
ambulatory surgical centers during such year.
``(2) Factors that contribute to the occurrence of such
infections, including health care worker immunization rates.
``(3) Based on the most recent information available to the
Secretary on the composition of the professional staff of
hospitals and ambulatory surgical centers, the number of
certified infection control professionals on the staff of
hospitals and ambulatory surgical centers.
``(4) The total increases or decreases in health care costs
that resulted from increases or decreases in the rates of
occurrence of each such type of infection during such year.
``(5) Recommendations, in coordination with the Center for
Quality Improvement established under section 931 of the Public
Health Service Act, for best practices to eliminate the rates
of occurrence of each such type of infection in hospitals and
ambulatory surgical centers.
``(d) Non-preemption of State Laws.--Nothing in this section shall be
construed as preempting or otherwise affecting any provision of State
law relating to the disclosure of information on health care-associated
infections or patient safety procedures for a hospital or ambulatory
surgical center.
``(e) Health Care-associated Infection.--For purposes of this
section:
``(1) In general.--The term `health care-associated
infection' means an infection that develops in a patient who
has received care in any institutional setting where health
care is delivered and is related to receiving health care.
``(2) Related to receiving health care.--The term `related to
receiving health care', with respect to an infection, means
that the infection was not incubating or present at the time
health care was provided.
``(f) Application to Critical Access Hospitals.--For purposes of this
section, the term `hospital' includes a critical access hospital, as
defined in section 1861(mm)(1).''.
(b) Effective Date.--With respect to section 1138A of the Social
Security Act (as inserted by subsection (a) of this section), the
requirement under such section that hospitals and ambulatory surgical
centers submit reports takes effect on such date (not later than 2
years after the date of the enactment of this Act) as the Secretary of
Health and Human Services shall specify. In order to meet such
deadline, the Secretary may implement such section through guidance or
other instructions.
(c) GAO Report.--Not later than 18 months after the date of the
enactment of this Act, the Comptroller General of the United States
shall submit to Congress a report on the program established under
section 1138A of the Social Security Act, as inserted by subsection
(a). Such report shall include an analysis of the appropriateness of
the types of information required for submission, compliance with
reporting requirements, the success of the validity procedures
established, and any conflict or overlap between the reporting required
under such section and any other reporting systems mandated by either
the States or the Federal Government.
(d) Report on Additional Data.--Not later than 18 months after the
date of the enactment of this Act, the Secretary of Health and Human
Services shall submit to the Congress a report on the appropriateness
of expanding the requirements under such section to include additional
information (such as health care worker immunization rates), in order
to improve health care quality and patient safety.
TITLE V--MEDICARE GRADUATE MEDICAL EDUCATION
SEC. 1501. DISTRIBUTION OF UNUSED RESIDENCY POSITIONS.
(a) In General.--Section 1886(h) of the Social Security Act (42
U.S.C. 1395ww(h)) is amended--
(1) in paragraph (4)(F)(i), by striking ``paragraph (7)'' and
inserting ``paragraphs (7) and (8)'';
(2) in paragraph (4)(H)(i), by striking ``paragraph (7)'' and
inserting ``paragraphs (7) and (8)'';
(3) in paragraph (7)(E), by inserting ``and paragraph (8)''
after ``this paragraph''; and
(4) by adding at the end the following new paragraph:
``(8) Additional redistribution of unused residency
positions.--
``(A) Reductions in limit based on unused
positions.--
``(i) Programs subject to reduction.--If a
hospital's reference resident level (specified
in clause (ii)) is less than the otherwise
applicable resident limit (as defined in
subparagraph (C)(ii)), effective for portions
of cost reporting periods occurring on or after
July 1, 2011, the otherwise applicable resident
limit shall be reduced by 90 percent of the
difference between such otherwise applicable
resident limit and such reference resident
level.
``(ii) Reference resident level.--
``(I) In general.--Except as
otherwise provided in a subsequent
subclause, the reference resident level
specified in this clause for a hospital
is the highest resident level for any
of the 3 most recent cost reporting
periods (ending before the date of the
enactment of this paragraph) of the
hospital for which a cost report has
been settled (or, if not, submitted
(subject to audit)), as determined by
the Secretary.
``(II) Use of most recent accounting
period to recognize expansion of
existing programs.--If a hospital
submits a timely request to increase
its resident level due to an expansion,
or planned expansion, of an existing
residency training program that is not
reflected on the most recent settled or
submitted cost report, after audit and
subject to the discretion of the
Secretary, subject to subclause (IV),
the reference resident level for such
hospital is the resident level that
includes the additional residents
attributable to such expansion or
establishment, as determined by the
Secretary. The Secretary is authorized
to determine an alternative reference
resident level for a hospital that
submitted to the Secretary a timely
request, before the start of the 2009-
2010 academic year, for an increase in
its reference resident level due to a
planned expansion.
``(III) Special provider agreement.--
In the case of a hospital described in
paragraph (4)(H)(v), the reference
resident level specified in this clause
is the limitation applicable under
subclause (I) of such paragraph.
``(IV) Previous redistribution.--The
reference resident level specified in
this clause for a hospital shall be
increased to the extent required to
take into account an increase in
resident positions made available to
the hospital under paragraph (7)(B)
that are not otherwise taken into
account under a previous subclause.
``(iii) Affiliation.--The provisions of
clause (i) shall be applied to hospitals which
are members of the same affiliated group (as
defined by the Secretary under paragraph
(4)(H)(ii)) and to the extent the hospitals can
demonstrate that they are filling any
additional resident slots allocated to other
hospitals through an affiliation agreement, the
Secretary shall adjust the determination of
available slots accordingly, or which the
Secretary otherwise has permitted the resident
positions (under section 402 of the Social
Security Amendments of 1967) to be aggregated
for purposes of applying the resident position
limitations under this subsection.
``(B) Redistribution.--
``(i) In general.--The Secretary shall
increase the otherwise applicable resident
limit for each qualifying hospital that submits
an application under this subparagraph by such
number as the Secretary may approve for
portions of cost reporting periods occurring on
or after July 1, 2011. The estimated aggregate
number of increases in the otherwise applicable
resident limit under this subparagraph may not
exceed the Secretary's estimate of the
aggregate reduction in such limits attributable
to subparagraph (A).
``(ii) Requirements for qualifying
hospitals.--A hospital is not a qualifying
hospital for purposes of this paragraph unless
the following requirements are met:
``(I) Maintenance of primary care
resident level.--The hospital maintains
the number of primary care residents at
a level that is not less than the base
level of primary care residents
increased by the number of additional
primary care resident positions
provided to the hospital under this
subparagraph. For purposes of this
subparagraph, the `base level of
primary care residents' for a hospital
is the level of such residents as of a
base period (specified by the
Secretary), determined without regard
to whether such positions were in
excess of the otherwise applicable
resident limit for such period but
taking into account the application of
subclauses (II) and (III) of
subparagraph (A)(ii).
``(II) Dedicated assignment of
additional resident positions to
primary care.--The hospital assigns all
such additional resident positions for
primary care residents.
``(III) Accreditation.--The
hospital's residency programs in
primary care are fully accredited or,
in the case of a residency training
program not in operation as of the base
year, the hospital is actively applying
for such accreditation for the program
for such additional resident positions
(as determined by the Secretary).
``(iii) Considerations in redistribution.--In
determining for which qualifying hospitals the
increase in the otherwise applicable resident
limit is provided under this subparagraph, the
Secretary shall take into account the
demonstrated likelihood of the hospital filling
the positions within the first 3 cost reporting
periods beginning on or after July 1, 2011,
made available under this subparagraph, as
determined by the Secretary.
``(iv) Priority for certain hospitals.--In
determining for which qualifying hospitals the
increase in the otherwise applicable resident
limit is provided under this subparagraph, the
Secretary shall distribute the increase to
qualifying hospitals based on the following
criteria:
``(I) The Secretary shall give
preference to hospitals that had a
reduction in resident training
positions under subparagraph (A).
``(II) The Secretary shall give
preference to hospitals with 3-year
primary care residency training
programs, such as family practice and
general internal medicine.
``(III) The Secretary shall give
preference to hospitals insofar as they
have in effect formal arrangements (as
determined by the Secretary) that place
greater emphasis upon training in
Federally qualified health centers,
rural health clinics, and other
nonprovider settings, and to hospitals
that receive additional payments under
subsection (d)(5)(F) and emphasize
training in an outpatient department.
``(IV) The Secretary shall give
preference to hospitals with a number
of positions (as of July 1, 2009) in
excess of the otherwise applicable
resident limit for such period.
``(V) The Secretary shall give
preference to hospitals that place
greater emphasis upon training in a
health professional shortage area
(designated under section 332 of the
Public Health Service Act) or a health
professional needs area (designated
under section 2211 of such Act).
``(VI) The Secretary shall give
preference to hospitals in States that
have low resident-to-population ratios
(including a greater preference for
those States with lower resident-to-
population ratios).
``(v) Limitation.--In no case shall more than
20 full-time equivalent additional residency
positions be made available under this
subparagraph with respect to any hospital.
``(vi) Application of per resident amounts
for primary care.--With respect to additional
residency positions in a hospital attributable
to the increase provided under this
subparagraph, the approved FTE resident amounts
are deemed to be equal to the hospital per
resident amounts for primary care and
nonprimary care computed under paragraph (2)(D)
for that hospital.
``(vi) Distribution.--The Secretary shall
distribute the increase in resident training
positions to qualifying hospitals under this
subparagraph not later than July 1, 2011.
``(C) Resident level and limit defined.--In this
paragraph:
``(i) The term `resident level' has the
meaning given such term in paragraph (7)(C)(i).
``(ii) The term `otherwise applicable
resident limit' means, with respect to a
hospital, the limit otherwise applicable under
subparagraphs (F)(i) and (H) of paragraph (4)
on the resident level for the hospital
determined without regard to this paragraph but
taking into account paragraph (7)(A).
``(D) Maintenance of primary care resident level.--In
carrying out this paragraph, the Secretary shall
require hospitals that receive additional resident
positions under subparagraph (B)--
``(i) to maintain records, and periodically
report to the Secretary, on the number of
primary care residents in its residency
training programs; and
``(ii) as a condition of payment for a cost
reporting period under this subsection for such
positions, to maintain the level of such
positions at not less than the sum of--
``(I) the base level of primary care
resident positions (as determined under
subparagraph (B)(ii)(I)) before
receiving such additional positions;
and
``(II) the number of such additional
positions.''.
(b) IME.--
(1) In general.--Section 1886(d)(5)(B)(v) of the Social
Security Act (42 U.S.C. 1395ww(d)(5)(B)(v)), in the third
sentence, is amended--
(A) by striking ``subsection (h)(7)'' and inserting
``subsections (h)(7) and (h)(8)''; and
(B) by striking ``it applies'' and inserting ``they
apply''.
(2) Conforming provision.--Section 1886(d)(5)(B) of the
Social Security Act (42 U.S.C. 1395ww(d)(5)(B)) is amended by
adding at the end the following clause:
``(x) For discharges occurring on or after July 1, 2011,
insofar as an additional payment amount under this subparagraph
is attributable to resident positions distributed to a hospital
under subsection (h)(8)(B), the indirect teaching adjustment
factor shall be computed in the same manner as provided under
clause (ii) with respect to such resident positions.''.
(c) Conforming Amendment.--Section 422(b)(2) of the Medicare
Prescription Drug, Improvement, and Modernization Act of 2003 (Public
Law 108-173) is amended by striking ``section 1886(h)(7)'' and all that
follows and inserting ``paragraphs (7) and (8) of subsection (h) of
section 1886 of the Social Security Act.''.
SEC. 1502. INCREASING TRAINING IN NONPROVIDER SETTINGS.
(a) Direct GME.--Section 1886(h)(4)(E) of the Social Security Act (42
U.S.C. 1395ww(h)) is amended--
(1) by designating the first sentence as a clause (i) with
the heading ``In general.--'' and appropriate indentation;
(2) by striking ``shall be counted and that all the time''
and inserting ``shall be counted and that--
``(I) effective for cost reporting
periods beginning before July 1, 2009,
all the time'';
(3) in subclause (I), as inserted by paragraph (1), by
striking the period at the end and inserting ``; and''; and
(A) by inserting after subclause (I), as so inserted,
the following:
``(II) effective for cost reporting
periods beginning on or after July 1,
2009, all the time so spent by a
resident shall be counted towards the
determination of full-time equivalency,
without regard to the setting in which
the activities are performed, if the
hospital incurs the costs of the
stipends and fringe benefits of the
resident during the time the resident
spends in that setting.
Any hospital claiming under this subparagraph
for time spent in a nonprovider setting shall
maintain and make available to the Secretary
records regarding the amount of such time and
such amount in comparison with amounts of such
time in such base year as the Secretary shall
specify.''.
(b) IME.--Section 1886(d)(5)(B)(iv) of the Social Security Act (42
U.S.C. 1395ww(d)(5)(B)(iv)) is amended--
(1) by striking ``(iv) Effective for discharges occurring on
or after October 1, 1997'' and inserting ``(iv)(I) Effective
for discharges occurring on or after October 1, 1997, and
before July 1, 2009''; and
(2) by inserting after subclause (I), as inserted by
paragraph (1), the following new subclause:
``(II) Effective for discharges occurring on or after July 1,
2009, all the time spent by an intern or resident in patient
care activities at an entity in a nonprovider setting shall be
counted towards the determination of full-time equivalency if
the hospital incurs the costs of the stipends and fringe
benefits of the intern or resident during the time the intern
or resident spends in that setting.''.
(c) OIG Study on Impact on Training.--The Inspector General of the
Department of Health and Human Services shall analyze the data
collected by the Secretary of Health and Human Services from the
records made available to the Secretary under section 1886(h)(4)(E) of
the Social Security Act, as amended by subsection (a), in order to
assess the extent to which there is an increase in time spent by
medical residents in training in nonprovider settings as a result of
the amendments made by this section. Not later than 4 years after the
date of the enactment of this Act, the Inspector General shall submit a
report to Congress on such analysis and assessment.
(d) Demonstration Project for Approved Teaching Health Centers.--
(1) In general.--The Secretary of Health and Human Services
shall conduct a demonstration project under which an approved
teaching health center (as defined in paragraph (3)) would be
eligible for payment under subsections (h) and (k) of section
1886 of the Social Security Act (42 U.S.C. 1395ww) of amounts
for its own direct costs of graduate medical education
activities for primary care residents, as well as for the
direct costs of graduate medical education activities of its
contracting hospital for such residents, in a manner similar to
the manner in which such payments would be made to a hospital
if the hospital were to operate such a program.
(2) Conditions.--Under the demonstration project--
(A) an approved teaching health center shall contract
with an accredited teaching hospital to carry out the
inpatient responsibilities of the primary care
residency program of the hospital involved and is
responsible for payment to the hospital for the
hospital's costs of the salary and fringe benefits for
residents in the program;
(B) the number of primary care residents of the
center shall not count against the contracting
hospital's resident limit; and
(C) the contracting hospital shall agree not to
diminish the number of residents in its primary care
residency training program.
(3) Approved teaching health center defined.--In this
subsection, the term ``approved teaching health center'' means
a nonprovider setting, such as a Federally qualified health
center or rural health clinic (as defined in section 1861(aa)
of the Social Security Act), that develops and operates an
accredited primary care residency program for which funding
would be available if it were operated by a hospital.
SEC. 1503. RULES FOR COUNTING RESIDENT TIME FOR DIDACTIC AND SCHOLARLY
ACTIVITIES AND OTHER ACTIVITIES.
(a) Direct GME.--Section 1886(h) of the Social Security Act (42
U.S.C. 1395ww(h)) is amended--
(1) in paragraph (4)(E), as amended by section 1502(a)--
(A) in clause (i), by striking ``Such rules'' and
inserting ``Subject to clause (ii), such rules''; and
(B) by adding at the end the following new clause:
``(ii) Treatment of certain nonprovider and
didactic activities.--Such rules shall provide
that all time spent by an intern or resident in
an approved medical residency training program
in a nonprovider setting that is primarily
engaged in furnishing patient care (as defined
in paragraph (5)(K)) in nonpatient care
activities, such as didactic conferences and
seminars, but not including research not
associated with the treatment or diagnosis of a
particular patient, as such time and activities
are defined by the Secretary, shall be counted
toward the determination of full-time
equivalency.'';
(2) in paragraph (4), by adding at the end the following new
subparagraph:
``(I) Treatment of certain time in aproved medical
residency training program.--In determining the
hospital's number of full-time equivalent residents for
purposes of this subsection, all the time that is spent
by an intern or resident in an approved medical
residency training program on vacation, sick leave, or
other approved leave, as such time is defined by the
Secretary, and that does not prolong the total time the
resident is participating in the approved program
beyond the normal duration of the program shall be
counted toward the determination of full-time
equivalency.''; and
(3) in paragraph (5), by adding at the end the following new
subparagraph:
``(K) Nonprovider setting that is primarily engaged
in furnishing patient care.--The term `nonprovider
setting that is primarily engaged in furnishing patient
care' means a nonprovider setting in which the primary
activity is the care and treatment of patients, as
defined by the Secretary.''.
(b) IME Determinations.--Section 1886(d)(5)(B) of such Act (42 U.S.C.
1395ww(d)(5)(B)), as amended by section 1501(b), is amended by adding
at the end the following new clause:
``(xi)(I) The provisions of subparagraph (I) of subsection
(h)(4) shall apply under this subparagraph in the same manner
as they apply under such subsection.
``(II) In determining the hospital's number of full-time
equivalent residents for purposes of this subparagraph, all the
time spent by an intern or resident in an approved medical
residency training program in nonpatient care activities, such
as didactic conferences and seminars, as such time and
activities are defined by the Secretary, that occurs in the
hospital shall be counted toward the determination of full-time
equivalency if the hospital--
``(aa) is recognized as a subsection (d) hospital;
``(bb) is recognized as a subsection (d) Puerto Rico
hospital;
``(cc) is reimbursed under a reimbursement system
authorized under section 1814(b)(3); or
``(dd) is a provider-based hospital outpatient
department.
``(III) In determining the hospital's number of full-time
equivalent residents for purposes of this subparagraph, all the
time spent by an intern or resident in an approved medical
residency training program in research activities that are not
associated with the treatment or diagnosis of a particular
patient, as such time and activities are defined by the
Secretary, shall not be counted toward the determination of
full-time equivalency.''.
(c) Effective Dates; Application.--
(1) In general.--Except as otherwise provided, the Secretary
of Health and Human Services shall implement the amendments
made by this section in a manner so as to apply to cost
reporting periods beginning on or after January 1, 1983.
(2) Direct gme.--Section 1886(h)(4)(E)(ii) of the Social
Security Act, as added by subsection (a)(1)(B), shall apply to
cost reporting periods beginning on or after July 1, 2008.
(3) IME.--Section 1886(d)(5)(B)(x)(III) of the Social
Security Act, as added by subsection (b), shall apply to cost
reporting periods beginning on or after October 1, 2001. Such
section, as so added, shall not give rise to any inference on
how the law in effect prior to such date should be interpreted.
(4) Application.--The amendments made by this section shall
not be applied in a manner that requires reopening of any
settled hospital cost reports as to which there is not a
jurisdictionally proper appeal pending as of the date of the
enactment of this Act on the issue of payment for indirect
costs of medical education under section 1886(d)(5)(B) of the
Social Security Act or for direct graduate medical education
costs under section 1886(h) of such Act.
SEC. 1504. PRESERVATION OF RESIDENT CAP POSITIONS FROM CLOSED
HOSPITALS.
(a) Direct GME.--Section 1886(h)(4)(H) of the Social Security Act (42
U.S.C. Section 1395ww(h)(4)(H)) is amended by adding at the end the
following new clause:
``(vi) Redistribution of residency slots
after a hospital closes.--
``(I) In general.--The Secretary
shall, by regulation, establish a
process consistent with subclauses (II)
and (III) under which, in the case
where a hospital (other than a hospital
described in clause (v)) with an
approved medical residency program in a
State closes on or after the date that
is 2 years before the date of the
enactment of this clause, the Secretary
shall increase the otherwise applicable
resident limit under this paragraph for
other hospitals in the State in
accordance with this clause.
``(II) Process for hospitals in
certain areas.--In determining for
which hospitals the increase in the
otherwise applicable resident limit
described in subclause (I) is provided,
the Secretary shall establish a process
to provide for such increase to one or
more hospitals located in the State.
Such process shall take into
consideration the recommendations
submitted to the Secretary by the
senior health official (as designated
by the chief executive officer of such
State) if such recommendations are
submitted not later than 180 days after
the date of the hospital closure
involved (or, in the case of a hospital
that closed after the date that is 2
years before the date of the enactment
of this clause, 180 days after such
date of enactment).
``(III) Limitation.--The estimated
aggregate number of increases in the
otherwise applicable resident limits
for hospitals under this clause shall
be equal to the estimated number of
resident positions in the approved
medical residency programs that closed
on or after the date described in
subclause (I).''.
(b) No Effect on Temporary FTE Cap Adjustments.--The amendments made
by this section shall not effect any temporary adjustment to a
hospital's FTE cap under section 413.79(h) of title 42, Code of Federal
Regulations (as in effect on the date of enactment of this Act) and
shall not affect the application of section 1886(h)(4)(H)(v) of the
Social Security Act.
(c) Conforming Amendments.--
(1) Section 422(b)(2) of the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003 (Public Law 108-
173), as amended by section 1501(c), is amended by striking
``(7) and'' and inserting ``(4)(H)(vi), (7), and''.
(2) Section 1886(h)(7)(E) of the Social Security Act (42
U.S.C. 1395ww(h)(7)(E)) is amended by inserting ``or under
paragraph (4)(H)(vi)'' after ``under this paragraph''.
SEC. 1505. IMPROVING ACCOUNTABILITY FOR APPROVED MEDICAL RESIDENCY
TRAINING.
(a) Specification of Goals for Approved Medical Residency Training
Programs.--Section 1886(h)(1) of the Social Security Act (42 U.S.C.
1395ww(h)(1)) is amended--
(1) by designating the matter beginning with
``Notwithstanding'' as a subparagraph (A) with the heading ``In
general.--'' and with appropriate indentation; and
(2) by adding at the end the following new subparagraph:
``(B) Goals and accountability for approved medical
residency training programs.--The goals of medical
residency training programs are to foster a physician
workforce so that physicians are trained to be able to
do the following:
``(i) Work effectively in various health care
delivery settings, such as nonprovider
settings.
``(ii) Coordinate patient care within and
across settings relevant to their specialties.
``(iii) Understand the relevant cost and
value of various diagnostic and treatment
options.
``(iv) Work in inter-professional teams and
multi-disciplinary team-based models in
provider and nonprovider settings to enhance
safety and improve quality of patient care.
``(v) Be knowledgeable in methods of
identifying systematic errors in health care
delivery and in implementing systematic
solutions in case of such errors, including
experience and participation in continuous
quality improvement projects to improve health
outcomes of the population the physicians
serve.
``(vi) Be meaningful EHR users (as determined
under section 1848(o)(2)) in the delivery of
care and in improving the quality of the health
of the community and the individuals that the
hospital serves.''
(b) GAO Study on Evaluation of Training Programs.--
(1) In general.--The Comptroller General of the United States
shall conduct a study to evaluate the extent to which medical
residency training programs--
(A) are meeting the goals described in section
1886(h)(1)(B) of the Social Security Act, as added by
subsection (a), in a range of residency programs,
including primary care and other specialties; and
(B) have the appropriate faculty expertise to teach
the topics required to achieve such goals.
(2) Report.--Not later than 18 months after the date of the
enactment of this Act, the Comptroller General shall submit to
Congress a report on such study and shall include in such
report recommendations as to how medical residency training
programs could be further encouraged to meet such goals through
means such as--
(A) development of curriculum requirements; and
(B) assessment of the accreditation processes of the
Accreditation Council for Graduate Medical Education
and the American Osteopathic Association and
effectiveness of those processes in accrediting medical
residency programs that meet the goals referred to in
paragraph (1)(A).
TITLE VI--PROGRAM INTEGRITY
Subtitle A--Increased Funding To Fight Waste, Fraud, and Abuse
SEC. 1601. INCREASED FUNDING AND FLEXIBILITY TO FIGHT FRAUD AND ABUSE.
(a) In General.--Section 1817(k) of the Social Security Act (42
U.S.C. 1395i(k)) is amended--
(1) by adding at the end the following new paragraph:
``(7) Additional funding.--In addition to the funds otherwise
appropriated to the Account from the Trust Fund under
paragraphs (3) and (4) and for purposes described in paragraphs
(3)(C) and (4)(A), there are hereby appropriated an additional
$100,000,000 to such Account from such Trust Fund for each
fiscal year beginning with 2011. The funds appropriated under
this paragraph shall be allocated in the same proportion as the
total funding appropriated with respect to paragraphs (3)(A)
and (4)(A) was allocated with respect to fiscal year 2010, and
shall be available without further appropriation until
expended.''.
(2) in paragraph (4)(A)--
(A) by inserting ``for activities described in
paragraph (3)(C) and'' after ``necessary''; and
(B) by inserting ``until expended'' after
``appropriation''.
(b) Flexibility in Pursuing Fraud and Abuse.--Section 1893(a) of the
Social Security Act (42 U.S.C. 1395ddd(a)) is amended by inserting ``,
or otherwise,'' after ``entities''.
Subtitle B--Enhanced Penalties for Fraud and Abuse
SEC. 1611. ENHANCED PENALTIES FOR FALSE STATEMENTS ON PROVIDER OR
SUPPLIER ENROLLMENT APPLICATIONS.
(a) In General.--Section 1128A(a) of the Social Security Act (42
U.S.C. 1320a-7a(a)) is amended--
(1) in paragraph (1)(D), by striking all that follows ``in
which the person was excluded'' and inserting ``under Federal
law from the Federal health care program under which the claim
was made, or'';
(2) by striking ``or'' at the end of paragraph (6);
(3) in paragraph (7), by inserting at the end ``or'';
(4) by inserting after paragraph (7) the following new
paragraph:
``(8) knowingly makes or causes to be made any false
statement, omission, or misrepresentation of a material fact in
any application, agreement, bid, or contract to participate or
enroll as a provider of services or supplier under a Federal
health care program, including managed care organizations under
title XIX, Medicare Advantage organizations under part C of
title XVIII, prescription drug plan sponsors under part D of
title XVIII, and entities that apply to participate as
providers of services or suppliers in such managed care
organizations and such plans;'';
(5) in the matter following paragraph (8), as inserted by
paragraph (4), by striking ``or in cases under paragraph (7),
$50,000 for each such act)'' and inserting ``in cases under
paragraph (7), $50,000 for each such act, or in cases under
paragraph (8), $50,000 for each false statement, omission, or
misrepresentation of a material fact)''; and
(6) in the second sentence, by striking ``for a lawful
purpose)'' and inserting ``for a lawful purpose, or in cases
under paragraph (8), an assessment of not more than 3 times the
amount claimed as the result of the false statement, omission,
or misrepresentation of material fact claimed by a provider of
services or supplier whose application to participate contained
such false statement, omission, or misrepresentation)''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to acts committed on or after January 1, 2010.
SEC. 1612. ENHANCED PENALTIES FOR SUBMISSION OF FALSE STATEMENTS
MATERIAL TO A FALSE CLAIM.
(a) In General.--Section 1128A(a) of the Social Security Act (42
U.S.C. 1320a-7a(a)), as amended by section 1611, is further amended--
(1) in paragraph (7), by striking ``or'' at the end;
(2) in paragraph (8), by inserting ``or'' at the end; and
(3) by inserting after paragraph (8), the following new
paragraph:
``(9) knowingly makes, uses, or causes to be made or used, a
false record or statement material to a false or fraudulent
claim for payment for items and services furnished under a
Federal health care program;''; and
(4) in the matter following paragraph (9), as inserted by
paragraph (3)--
(A) by striking ``or in cases under paragraph (8)''
and inserting ``in cases under paragraph (8)''; and
(B) by striking ``a material fact)'' and inserting
``a material fact, in cases under paragraph (9),
$50,000 for each false record or statement)''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to acts committed on or after January 1, 2010.
SEC. 1613. ENHANCED PENALTIES FOR DELAYING INSPECTIONS.
(a) In General.--Section 1128A(a) of the Social Security Act (42
U.S.C. 1320a-7a(a)), as amended by sections 1611 and 1612, is further
amended--
(1) in paragraph (8), by striking ``or'' at the end;
(2) in paragraph (9), by inserting ``or'' at the end;
(3) by inserting after paragraph (9) the following new
paragraph:
``(10) fails to grant timely access, upon reasonable request
(as defined by the Secretary in regulations), to the Inspector
General of the Department of Health and Human Services, for the
purpose of audits, investigations, evaluations, or other
statutory functions of the Inspector General of the Department
of Health and Human Services;''; and
(4) in the matter following paragraph (10), as inserted by
paragraph (3), by inserting ``, or in cases under paragraph
(10), $15,000 for each day of the failure described in such
paragraph'' after ``false record or statement''.
(b) Ensuring Timely Inspections Relating to Contracts With MA
Organizations.--Section 1857(d)(2) of such Act (42 U.S.C. 1395w-
27(d)(2)) is amended--
(1) in subparagraph (A), by inserting ``timely'' before
``inspect''; and
(2) in subparagraph (B), by inserting ``timely'' before
``audit and inspect''.
(c) Effective Date.--The amendments made by subsection (a) shall
apply to violations committed on or after January 1, 2010.
SEC. 1614. ENHANCED HOSPICE PROGRAM SAFEGUARDS.
(a) Medicare.--Part A of title XVIII of the Social Security Act is
amended by inserting after section 1819 the following new section:
``SEC. 1819A. ASSURING QUALITY OF CARE IN HOSPICE CARE.
``(a) In General.--If the Secretary determines on the basis of a
survey or otherwise, that a hospice program that is certified for
participation under this title has demonstrated a substandard quality
of care and failed to meet such other requirements as the Secretary may
find necessary in the interest of the health and safety of the
individuals who are provided care and services by the agency or
organization involved and determines--
``(1) that the deficiencies involved immediately jeopardize
the health and safety of the individuals to whom the program
furnishes items and services, the Secretary shall take
immediate action to remove the jeopardy and correct the
deficiencies through the remedy specified in subsection
(b)(2)(A)(iii) or terminate the certification of the program,
and may provide, in addition, for 1 or more of the other
remedies described in subsection (b)(2)(A); or
``(2) that the deficiencies involved do not immediately
jeopardize the health and safety of the individuals to whom the
program furnishes items and services, the Secretary may--
``(A) impose intermediate sanctions developed
pursuant to subsection (b), in lieu of terminating the
certification of the program; and
``(B) if, after such a period of intermediate
sanctions, the program is still not in compliance with
such requirements, the Secretary shall terminate the
certification of the program.
If the Secretary determines that a hospice program that is
certified for participation under this title is in compliance
with such requirements but, as of a previous period, was not in
compliance with such requirements, the Secretary may provide
for a civil money penalty under subsection (b)(2)(A)(i) for the
days in which it finds that the program was not in compliance
with such requirements.
``(b) Intermediate Sanctions.--
``(1) Development and implementation.--The Secretary shall
develop and implement, by not later than July 1, 2012--
``(A) a range of intermediate sanctions to apply to
hospice programs under the conditions described in
subsection (a), and
``(B) appropriate procedures for appealing
determinations relating to the imposition of such
sanctions.
``(2) Specified sanctions.--
``(A) In general.--The intermediate sanctions
developed under paragraph (1) may include--
``(i) civil money penalties in an amount not
to exceed $10,000 for each day of noncompliance
or, in the case of a per instance penalty
applied by the Secretary, not to exceed
$25,000,
``(ii) denial of all or part of the payments
to which a hospice program would otherwise be
entitled under this title with respect to items
and services furnished by a hospice program on
or after the date on which the Secretary
determines that intermediate sanctions should
be imposed pursuant to subsection (a)(2),
``(iii) the appointment of temporary
management to oversee the operation of the
hospice program and to protect and assure the
health and safety of the individuals under the
care of the program while improvements are
made,
``(iv) corrective action plans, and
``(v) in-service training for staff.
The provisions of section 1128A (other than subsections
(a) and (b)) shall apply to a civil money penalty under
clause (i) in the same manner as such provisions apply
to a penalty or proceeding under section 1128A(a). The
temporary management under clause (iii) shall not be
terminated until the Secretary has determined that the
program has the management capability to ensure
continued compliance with all requirements referred to
in that clause.
``(B) Clarification.--The sanctions specified in
subparagraph (A) are in addition to sanctions otherwise
available under State or Federal law and shall not be
construed as limiting other remedies, including any
remedy available to an individual at common law.
``(C) Commencement of payment.--A denial of payment
under subparagraph (A)(ii) shall terminate when the
Secretary determines that the hospice program no longer
demonstrates a substandard quality of care and meets
such other requirements as the Secretary may find
necessary in the interest of the health and safety of
the individuals who are provided care and services by
the agency or organization involved.
``(3) Secretarial authority.--The Secretary shall develop and
implement, by not later than July 1, 2011, specific procedures
with respect to the conditions under which each of the
intermediate sanctions developed under paragraph (1) is to be
applied, including the amount of any fines and the severity of
each of these sanctions. Such procedures shall be designed so
as to minimize the time between identification of deficiencies
and imposition of these sanctions and shall provide for the
imposition of incrementally more severe fines for repeated or
uncorrected deficiencies.''.
(b) Application to Medicaid.--Section 1905(o) of the Social Security
Act (42 U.S.C. 1396d(o)) is amended by adding at the end the following
new paragraph:
``(4) The provisions of section 1819A shall apply to a hospice
program providing hospice care under this title in the same manner as
such provisions apply to a hospice program providing hospice care under
title XVIII.''.
(c) Application to CHIP.--Title XXI of the Social Security Act is
amended by adding at the end the following new section:
``SEC. 2114. ASSURING QUALITY OF CARE IN HOSPICE CARE.
``The provisions of section 1819A shall apply to a hospice program
providing hospice care under this title in the same manner such
provisions apply to a hospice program providing hospice care under
title XVIII.''.
SEC. 1615. ENHANCED PENALTIES FOR INDIVIDUALS EXCLUDED FROM PROGRAM
PARTICIPATION.
(a) In General.--Section 1128A(a) of the Social Security Act (42
U.S.C. 1320a-7a(a)), as amended by the previous sections, is further
amended--
(1) by striking ``or'' at the end of paragraph (9);
(2) by inserting ``or'' at the end of paragraph (10);
(3) by inserting after paragraph (10) the following new
paragraph:
``(11) orders or prescribes an item or service, including
without limitation home health care, diagnostic and clinical
lab tests, prescription drugs, durable medical equipment,
ambulance services, physical or occupational therapy, or any
other item or service, during a period when the person has been
excluded from participation in a Federal health care program,
and the person knows or should know that a claim for such item
or service will be presented to such a program;''; and
(4) in the matter following paragraph (11), as inserted by
paragraph (3), by striking ``or in cases under paragraph (10),
$15,000 for each day of the failure described in such
paragraph'' and inserting ``in cases under paragraph (10),
$15,000 for each day of the failure described in such
paragraph, or in cases under paragraph (11), $50,000 for each
order or prescription for an item or service by an excluded
individual''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to violations committed on or after January 1, 2010.
SEC. 1616. ENHANCED PENALTIES FOR PROVISION OF FALSE INFORMATION BY
MEDICARE ADVANTAGE AND PART D PLANS.
(a) In General.--Section 1857(g)(2)(A) of the Social Security Act (42
U.S.C. 1395w--27(g)(2)(A)) is amended by inserting ``except with
respect to a determination under subparagraph (E), an assessment of not
more than 3 times the amount claimed by such plan or plan sponsor based
upon the misrepresentation or falsified information involved,'' after
``for each such determination,''.
(b) Effective Date.--The amendment made by subsection (a) shall apply
to violations committed on or after January 1, 2010.
SEC. 1617. ENHANCED PENALTIES FOR MEDICARE ADVANTAGE AND PART D
MARKETING VIOLATIONS.
(a) In General.--Section 1857(g)(1) of the Social Security Act (42
U.S.C. 1395w--27(g)(1)), as amended by section 1221(b), is amended--
(1) in subparagraph (G), by striking ``or'' at the end;
(2) by inserting after subparagraph (H) the following new
subparagraphs:
``(I) except as provided under subparagraph (C) or
(D) of section 1860D-1(b)(1), enrolls an individual in
any plan under this part without the prior consent of
the individual or the designee of the individual;
``(J) transfers an individual enrolled under this
part from one plan to another without the prior consent
of the individual or the designee of the individual or
solely for the purpose of earning a commission;
``(K) fails to comply with marketing restrictions
described in subsections (h) and (j) of section 1851 or
applicable implementing regulations or guidance; or
``(L) employs or contracts with any individual or
entity who engages in the conduct described in
subparagraphs (A) through (K) of this paragraph;''; and
(3) by adding at the end the following new sentence: ``The
Secretary may provide, in addition to any other remedies
authorized by law, for any of the remedies described in
paragraph (2), if the Secretary determines that any employee or
agent of such organization, or any provider or supplier who
contracts with such organization, has engaged in any conduct
described in subparagraphs (A) through (L) of this paragraph.''
(b) Effective Date.--The amendments made by subsection (a) shall
apply to violations committed on or after January 1, 2010.
SEC. 1618. ENHANCED PENALTIES FOR OBSTRUCTION OF PROGRAM AUDITS.
(a) In General.--Section 1128(b)(2) of the Social Security Act (42
U.S.C. 1320a-7(b)(2)) is amended--
(1) in the heading, by inserting ``or audit'' after
``investigation''; and
(2) by striking ``investigation into'' and all that follows
through the period and inserting ``investigation or audit
related to--''
``(A) any offense described in paragraph (1) or in
subsection (a); or
``(B) the use of funds received, directly or
indirectly, from any Federal health care program (as
defined in section 1128B(f)).''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to violations committed on or after January 1, 2010.
SEC. 1619. EXCLUSION OF CERTAIN INDIVIDUALS AND ENTITIES FROM
PARTICIPATION IN MEDICARE AND STATE HEALTH CARE
PROGRAMS.
(a) In General.--Section 1128(c) of the Social Security Act, as
previously amended by this division, is further amended--
(1) in the heading, by striking ``and Period'' and inserting
``Period, and Effect''; and
(2) by adding at the end the following new paragraph:
``(4)(A) For purposes of this Act, subject to subparagraph (C), the
effect of exclusion is that no payment may be made by any Federal
health care program (as defined in section 1128B(f)) with respect to
any item or service furnished--
``(i) by an excluded individual or entity; or
``(ii) at the medical direction or on the prescription of a
physician or other authorized individual when the person
submitting a claim for such item or service knew or had reason
to know of the exclusion of such individual.
``(B) For purposes of this section and sections 1128A and 1128B,
subject to subparagraph (C), an item or service has been furnished by
an individual or entity if the individual or entity directly or
indirectly provided, ordered, manufactured, distributed, prescribed, or
otherwise supplied the item or service regardless of how the item or
service was paid for by a Federal health care program or to whom such
payment was made.
``(C)(i) Payment may be made under a Federal health care program for
emergency items or services (not including items or services furnished
in an emergency room of a hospital) furnished by an excluded individual
or entity, or at the medical direction or on the prescription of an
excluded physician or other authorized individual during the period of
such individual's exclusion.
``(ii) In the case that an individual eligible for benefits under
title XVIII or XIX submits a claim for payment for items or services
furnished by an excluded individual or entity, and such individual
eligible for such benefits did not know or have reason to know that
such excluded individual or entity was so excluded, then,
notwithstanding such exclusion, payment shall be made for such items or
services. In such case the Secretary shall notify such individual
eligible for such benefits of the exclusion of the individual or entity
furnishing the items or services. Payment shall not be made for items
or services furnished by an excluded individual or entity to an
individual eligible for such benefits after a reasonable time (as
determined by the Secretary in regulations) after the Secretary has
notified the individual eligible for such benefits of the exclusion of
the individual or entity furnishing the items or services.
``(iii) In the case that a claim for payment for items or services
furnished by an excluded individual or entity is submitted by an
individual or entity other than an individual eligible for benefits
under title XVIII or XIX or the excluded individual or entity, and the
Secretary determines that the individual or entity that submitted the
claim took reasonable steps to learn of the exclusion and reasonably
relied upon inaccurate or misleading information from the relevant
Federal health care program or its contractor, the Secretary may waive
repayment of the amount paid in violation of the exclusion to the
individual or entity that submitted the claim for the items or services
furnished by the excluded individual or entity. If a Federal health
care program contractor provided inaccurate or misleading information
that resulted in the waiver of an overpayment under this clause, the
Secretary shall take appropriate action to recover the improperly paid
amount from the contractor.''.
Subtitle C--Enhanced Program and Provider Protections
SEC. 1631. ENHANCED CMS PROGRAM PROTECTION AUTHORITY.
(a) In General.--Title XI of the Social Security Act (42 U.S.C. 1301
et seq.) is amended by inserting after section 1128F the following new
section:
``SEC. 1128G. ENHANCED PROGRAM AND PROVIDER PROTECTIONS IN THE
MEDICARE, MEDICAID, AND CHIP PROGRAMS.
``(a) Certain Authorized Screening, Enhanced Oversight Periods, and
Enrollment Moratoria.--
``(1) In general.--For periods beginning after January 1,
2011, in the case that the Secretary determines there is a
significant risk of fraudulent activity (as determined by the
Secretary based on relevant complaints, reports, referrals by
law enforcement or other sources, data analysis, trending
information, or claims submissions by providers of services and
suppliers) with respect to a category of provider of services
or supplier of items or services, including a category within a
geographic area, under title XVIII, XIX, or XXI, the Secretary
may impose any of the following requirements with respect to a
provider of services or a supplier (whether such provider or
supplier is initially enrolling in the program or is renewing
such enrollment):
``(A) Screening under paragraph (2).
``(B) Enhanced oversight periods under paragraph (3).
``(C) Enrollment moratoria under paragraph (4).
In applying this subsection for purposes of title XIX and XXI
the Secretary may require a State to carry out the provisions
of this subsection as a requirement of the State plan under
title XIX or the child health plan under title XXI. Actions
taken and determinations made under this subsection shall not
be subject to review by a judicial tribunal.
``(2) Screening.--For purposes of paragraph (1), the
Secretary shall establish procedures under which screening is
conducted with respect to providers of services and suppliers
described in such paragraph. Such screening may include--
``(A) licensing board checks;
``(B) screening against the list of individuals and
entities excluded from the program under title XVIII,
XIX, or XXI;
``(C) the excluded provider list system;
``(D) background checks; and
``(E) unannounced pre-enrollment or other site
visits.
``(3) Enhanced oversight period.--For purposes of paragraph
(1), the Secretary shall establish procedures to provide for a
period of not less than 30 days and not more than 365 days
during which providers of services and suppliers described in
such paragraph, as the Secretary determines appropriate, would
be subject to enhanced oversight, such as required or
unannounced (or required and unannounced) site visits or
inspections, prepayment review, enhanced review of claims, and
such other actions as specified by the Secretary, under the
programs under titles XVIII, XIX, and XXI. Under such
procedures, the Secretary may extend such period for more than
365 days if the Secretary determines that after the initial
period such additional period of oversight is necessary.
``(4) Moratorium on enrollment of providers and suppliers.--
For purposes of paragraph (1), the Secretary, based upon a
finding of a risk of serious ongoing fraud within a program
under title XVIII, XIX, or XXI, may impose a moratorium on the
enrollment of providers of services and suppliers within a
category of providers of services and suppliers (including a
category within a specific geographic area) under such title.
Such a moratorium may only be imposed if the Secretary makes a
determination that the moratorium would not adversely impact
access of individuals to care under such program.
``(5) Clarification.--Nothing in this subsection shall be
interpreted to preclude or limit the ability of a State to
engage in provider screening or enhanced provider oversight
activities beyond those required by the Secretary.''.
(b) Conforming Amendments.--
(1) Medicaid.--Section 1902(a) of the Social Security Act (42
U.S.C. 42 U.S.C. 1396a(a)) is amended--
(A) in paragraph (23), by inserting before the
semicolon at the end the following: ``or by a person to
whom or entity to which a moratorium under section
1128G(a)(4) is applied during the period of such
moratorium'';
(B) in paragraph (72); by striking at the end
``and'';
(C) in paragraph (73), by striking the period at the
end and inserting ``; and''; and
(D) by inserting after paragraph (73) the following
new paragraph:
``(74) provide that the State will enforce any determination
made by the Secretary under subsection (a) of section 1128G
(relating to a significant risk of fraudulent activity with
respect to a category of provider or supplier described in such
subsection (a) through use of the appropriate procedures
described in such subsection (a)), and that the State will
carry out any activities as required by the Secretary for
purposes of such subsection (a).''.
(2) CHIP.--Section 2102 of such Act (42 U.S.C. 1397bb) is
amended by adding at the end the following new subsection:
``(d) Program Integrity.--A State child health plan shall include a
description of the procedures to be used by the State--
``(1) to enforce any determination made by the Secretary
under subsection (a) of section 1128G (relating to a
significant risk of fraudulent activity with respect to a
category of provider or supplier described in such subsection
through use of the appropriate procedures described in such
subsection); and
``(2) to carry out any activities as required by the
Secretary for purposes of such subsection.''.
(3) Medicare.--Section 1866(j) of such Act (42 U.S.C.
1395cc(j)) is amended by adding at the end the following new
paragraph:
``(3) Program integrity.--The provisions of section 1128G(a)
apply to enrollments and renewals of enrollments of providers
of services and suppliers under this title.''.
SEC. 1632. ENHANCED MEDICARE, MEDICAID, AND CHIP PROGRAM DISCLOSURE
REQUIREMENTS RELATING TO PREVIOUS AFFILIATIONS.
(a) In General.--Section 1128G of the Social Security Act, as
inserted by section 1631, is amended by adding at the end the following
new subsection:
``(b) Enhanced Program Disclosure Requirements.--
``(1) Disclosure.--A provider of services or supplier who
submits on or after July 1, 2011, an application for enrollment
and renewing enrollment in a program under title XVIII, XIX, or
XXI shall disclose (in a form and manner determined by the
Secretary) any current affiliation or affiliation within the
previous 10-year period with a provider of services or supplier
that has uncollected debt or with a person or entity that has
been suspended or excluded under such program, subject to a
payment suspension, or has had its billing privileges revoked.
``(2) Enhanced safeguards.--If the Secretary determines that
such previous affiliation of such provider or supplier poses a
risk of fraud, waste, or abuse, the Secretary may apply such
enhanced safeguards as the Secretary determines necessary to
reduce such risk associated with such provider or supplier
enrolling or participating in the program under title XVIII,
XIX, or XXI. Such safeguards may include enhanced oversight,
such as enhanced screening of claims, required or unannounced
(or required and unannounced) site visits or inspections,
additional information reporting requirements, and conditioning
such enrollment on the provision of a surety bond.
``(3) Authority to deny participation.--If the Secretary
determines that there has been at least one such affiliation
and that such affiliation or affiliations, as applicable, of
such provider or supplier poses a serious risk of fraud, waste,
or abuse, the Secretary may deny the application of such
provider or supplier.''.
(b) Conforming Amendments.--
(1) Medicaid.--Paragraph (74) of section 1902(a) of such Act
(42 U.S.C. 1396a(a)), as added by section 1631(b)(1), is
amended--
(A) by inserting ``or subsection (b) of such section
(relating to disclosure requirements)'' before ``, and
that the State''; and
(B) by inserting before the period the following:
``and apply any enhanced safeguards, with respect to a
provider or supplier described in such subsection (b),
as the Secretary determines necessary under such
subsection (b)''.
(2) CHIP.--Subsection (d) of section 2102 of such Act (42
U.S.C. 1397bb), as added by section 1631(b)(2), is amended--
(A) in paragraph (1), by striking at the end ``and'';
(B) in paragraph (2) by striking the period at the
end and inserting ``; and''' and
(C) by adding at the end the following new paragraph:
``(3) to enforce any determination made by the Secretary
under subsection (b) of section 1128G (relating to disclosure
requirements) and to apply any enhanced safeguards, with
respect to a provider or supplier described in such subsection,
as the Secretary determines necessary under such subsection.''.
SEC. 1633. REQUIRED INCLUSION OF PAYMENT MODIFIER FOR CERTAIN
EVALUATION AND MANAGEMENT SERVICES.
Section 1848 of the Social Security Act (42 U.S.C. 1395w-4), as
amended by section 4101 of the HITECH Act (Public Law 111-5), is
amended by adding at the end the following new subsection:
``(p) Payment Modifier for Certain Evaluation and Management
Services.--The Secretary shall establish a payment modifier under the
fee schedule under this section for evaluation and management services
(as specified in section 1842(b)(16)(B)(ii)) that result in the
ordering of additional services (such as lab tests), the prescription
of drugs, the furnishing or ordering of durable medical equipment in
order to enable better monitoring of claims for payment for such
additional services under this title, or the ordering, furnishing, or
prescribing of other items and services determined by the Secretary to
pose a high risk of waste, fraud, and abuse. The Secretary may require
providers of services or suppliers to report such modifier in claims
submitted for payment.''.
SEC. 1634. EVALUATIONS AND REPORTS REQUIRED UNDER MEDICARE INTEGRITY
PROGRAM.
(a) In General.--Section 1893(c) of the Social Security Act (42
U.S.C. 1395ddd(c)) is amended--
(1) in paragraph (3), by striking at the end ``and'';
(2) by redesignating paragraph (4) as paragraph (5); and
(3) by inserting after paragraph (3) the following new
paragraph:
``(4) for the contract year beginning in 2011 and each
subsequent contract year, the entity provides assurances to the
satisfaction of the Secretary that the entity will conduct
periodic evaluations of the effectiveness of the activities
carried out by such entity under the Program and will submit to
the Secretary an annual report on such activities; and''.
(b) Reference to Medicaid Integrity Program.--For a similar provision
with respect to the Medicaid Integrity Program, see section 1752.
SEC. 1635. REQUIRE PROVIDERS AND SUPPLIERS TO ADOPT PROGRAMS TO REDUCE
WASTE, FRAUD, AND ABUSE.
(a) In General.--Section 1874 of the Social Security Act (42 U.S.C.
42 U.S.C. 1395kk) is amended by adding at the end the following new
subsection:
``(e) Compliance Programs for Providers of Services and Suppliers.--
``(1) In general.--The Secretary may disenroll a provider of
services or a supplier (other than a physician or a skilled
nursing facility) under this title (or may impose any civil
monetary penalty or other intermediate sanction under paragraph
(4)) if such provider of services or supplier fails to, subject
to paragraph (5), establish a compliance program that contains
the core elements established under paragraph (2).
``(2) Establishment of core elements.--The Secretary, in
consultation with the Inspector General of the Department of
Health and Human Services, shall establish core elements for a
compliance program under paragraph (1). Such elements may
include written policies, procedures, and standards of conduct,
a designated compliance officer and a compliance committee;
effective training and education pertaining to fraud, waste,
and abuse for the organization's employees and contractors; a
confidential or anonymous mechanism, such as a hotline, to
receive compliance questions and reports of fraud, waste, or
abuse; disciplinary guidelines for enforcement of standards;
internal monitoring and auditing procedures, including
monitoring and auditing of contractors; procedures for ensuring
prompt responses to detected offenses and development of
corrective action initiatives, including responses to potential
offenses; and procedures to return all identified overpayments
to the programs under this title, title XIX, and title XXI.
``(3) Timeline for implementation.--The Secretary shall
determine a timeline for the establishment of the core elements
under paragraph (2) and the date on which a provider of
services and suppliers (other than physicians) shall be
required to have established such a program for purposes of
this subsection.
``(4) CMS enforcement authority.--The Administrator for the
Centers of Medicare & Medicaid Services shall have the
authority to determine whether a provider of services or
supplier described in subparagraph (3) has met the requirement
of this subsection and to impose a civil monetary penalty not
to exceed $50,000 for each violation. The Secretary may also
impose other intermediate sanctions, including corrective
action plans and additional monitoring in the case of a
violation of this subsection.
``(5) Pilot program.--The Secretary may conduct a pilot
program on the application of this subsection with respect to a
category of providers of services or suppliers (other than
physicians) that the Secretary determines to be a category
which is at high risk for waste, fraud, and abuse before
implementing the requirements of this subsection to all
providers of services and suppliers described in paragraph
(3).''.
(b) Reference to Similar Medicaid Provision.--For a similar provision
with respect to the Medicaid program under title XIX of the Social
Security Act, see section 1753.
SEC. 1636. MAXIMUM PERIOD FOR SUBMISSION OF MEDICARE CLAIMS REDUCED TO
NOT MORE THAN 12 MONTHS.
(a) Purpose.--In general, the 36-month period currently allowed for
claims filing under parts A, B, C, and, D of title XVIII of the Social
Security Act presents opportunities for fraud schemes in which
processing patterns of the Centers for Medicare & Medicaid Services can
be observed and exploited. Narrowing the window for claims processing
will not overburden providers and will reduce fraud and abuse.
(b) Reducing Maximum Period for Submission.--
(1) Part a.--Section 1814(a) of the Social Security Act (42
U.S.C. 1395f(a)) is amended--
(A) in paragraph (1), by striking ``period of 3
calendar years'' and all that follows and inserting
``period of 1 calendar year from which such services
are furnished; and''; and
(B) by adding at the end the following new sentence:
``In applying paragraph (1), the Secretary may specify
exceptions to the 1 calendar year period specified in
such paragraph.''.
(2) Part b.--Section 1835(a) of such Act (42 U.S.C. 1395n(a))
is amended--
(A) in paragraph (1), by striking ``period of 3
calendar years'' and all that follows and inserting
``period of 1 calendar year from which such services
are furnished; and''; and
(B) by adding at the end the following new sentence:
``In applying paragraph (1), the Secretary may specify
exceptions to the 1 calendar year period specified in
such paragraph.''.
(3) Parts c and d.--Section 1857(d) of such Act is amended by
adding at the end the following new paragraph:
``(7) Period for submission of claims.--The contract shall
require an MA organization or PDP sponsor to require any
provider of services under contract with, in partnership with,
or affiliated with such organization or sponsor to ensure that,
with respect to items and services furnished by such provider
to an enrollee of such organization, written request, signed by
such enrollee, except in cases in which the Secretary finds it
impracticable for the enrollee to do so, is filed for payment
for such items and services in such form, in such manner, and
by such person or persons as the Secretary may by regulation
prescribe, no later than the close of the 1 calendar year
period after such items and services are furnished. In applying
the previous sentence, the Secretary may specify exceptions to
the 1 calendar year period specified.''.
(c) Effective Date.--The amendments made by subsection (b) shall be
effective for items and services furnished on or after January 1, 2011.
SEC. 1637. PHYSICIANS WHO ORDER DURABLE MEDICAL EQUIPMENT OR HOME
HEALTH SERVICES REQUIRED TO BE MEDICARE-ENROLLED
PHYSICIANS OR ELIGIBLE PROFESSIONALS.
(a) DME.--Section 1834(a)(11)(B) of the Social Security Act (42
U.S.C. 1395m(a)(11)(B)) is amended by striking ``physician'' and
inserting ``physician enrolled under section 1866(j) or an eligible
professional under section 1848(k)(3)(B)''.
(b) Home Health Services.--
(1) Part a.--Section 1814(a)(2) of such Act (42 U.S.C.
1395(a)(2)) is amended in the matter preceding subparagraph (A)
by inserting ``in the case of services described in
subparagraph (C), a physician enrolled under section 1866(j) or
an eligible professional under section 1848(k)(3)(B),'' before
``or, in the case of services''.
(2) Part b.--Section 1835(a)(2) of such Act (42 U.S.C.
1395n(a)(2)) is amended in the matter preceding subparagraph
(A) by inserting ``, or in the case of services described in
subparagraph (A), a physician enrolled under section 1866(j) or
an eligible professional under section 1848(k)(3)(B),'' after
``a physician''.
(c) Discretion to Expand Application.--The Secretary may extend the
requirement applied by the amendments made by subsections (a) and (b)
to durable medical equipment and home health services (relating to
requiring certifications and written orders to be made by enrolled
physicians and health professions) to other categories of items or
services under this title, including covered part D drugs as defined in
section 1860D-2(e), if the Secretary determines that such application
would help to reduce the risk of waste, fraud, and abuse with respect
to such other categories under title XVIII of the Social Security Act.
(d) Effective Date.--The amendments made by this section shall apply
to written orders and certifications made on or after July 1, 2010.
SEC. 1638. REQUIREMENT FOR PHYSICIANS TO PROVIDE DOCUMENTATION ON
REFERRALS TO PROGRAMS AT HIGH RISK OF WASTE AND
ABUSE.
(a) Physicians and Other Suppliers.--Section 1842(h) of the Social
Security Act is amended by adding at the end the following new
paragraph
``(10) The Secretary may disenroll, for a period of not more than one
year for each act, a physician or supplier under section 1866(j) if
such physician or supplier fails to maintain and, upon request of the
Secretary, provide access to documentation relating to written orders
or requests for payment for durable medical equipment, certifications
for home health services, or referrals for other items or services
written or ordered by such physician or supplier under this title, as
specified by the Secretary.''.
(b) Providers of Services.--Section 1866(a)(1) of such Act (42 U.S.C.
1395cc) is amended--
(1) in subparagraph (U), by striking at the end ``and'';
(2) in subparagraph (V), by striking the period at the end
and adding ``, and''; and
(3) by adding at the end the following new subparagraph:
``(W) maintain and, upon request of the Secretary, provide
access to documentation relating to written orders or requests
for payment for durable medical equipment, certifications for
home health services, or referrals for other items or services
written or ordered by the provider under this title, as
specified by the Secretary.''.
(c) OIG Permissive Exclusion Authority.--Section 1128(b)(11) of the
Social Security Act (42 U.S.C. 1320a-7(b)(11)) is amended by inserting
``, ordering, referring for furnishing, or certifying the need for''
after ``furnishing''.
(d) Effective Date.--The amendments made by this section shall apply
to orders, certifications, and referrals made on or after January 1,
2010.
SEC. 1639. FACE-TO-FACE ENCOUNTER WITH PATIENT REQUIRED BEFORE
PHYSICIANS MAY CERTIFY ELIGIBILITY FOR HOME HEALTH
SERVICES OR DURABLE MEDICAL EQUIPMENT UNDER
MEDICARE.
(a) Condition of Payment for Home Health Services.--
(1) Part a.--Section 1814(a)(2)(C) of such Act is amended--
(A) by striking ``and such services'' and inserting
``such services''; and
(B) by inserting after ``care of a physician'' the
following: ``, and, in the case of a certification or
recertification made by a physician after January 1,
2010, prior to making such certification the physician
must document that the physician has had a face-to-face
encounter (including through use of telehealth and
other than with respect to encounters that are incident
to services involved) with the individual during the 6-
month period preceding such certification, or other
reasonable timeframe as determined by the Secretary''.
(2) Part b.--Section 1835(a)(2)(A) of the Social Security Act
is amended--
(A) by striking ``and'' before ``(iii)''; and
(B) by inserting after ``care of a physician'' the
following: ``, and (iv) in the case of a certification
or recertification after January 1, 2010, prior to
making such certification the physician must document
that the physician has had a face-to-face encounter
(including through use of telehealth and other than
with respect to encounters that are incident to
services involved) with the individual during the 6-
month period preceding such certification or
recertification, or other reasonable timeframe as
determined by the Secretary''.
(b) Condition of Payment for Durable Medical Equipment.--Section
1834(a)(11)(B) of the Social Security Act (42 U.S.C. 1395m(a)(11)(B))
is amended by adding before the period at the end the following: ``and
shall require that such an order be written pursuant to the physician
documenting that the physician has had a face-to-face encounter
(including through use of telehealth and other than with respect to
encounters that are incident to services involved) with the individual
involved during the 6-month period preceding such written order, or
other reasonable timeframe as determined by the Secretary''.
(c) Application to Other Areas Under Medicare.--The Secretary may
apply the face-to-face encounter requirement described in the
amendments made by subsections (a) and (b) to other items and services
for which payment is provided under title XVIII of the Social Security
Act based upon a finding that such an decision would reduce the risk of
waste, fraud, or abuse.
(d) Application to Medicaid and CHIP.--The requirements pursuant to
the amendments made by subsections (a) and (b) shall apply in the case
of physicians making certifications for home health services under
title XIX or XXI of the Social Security Act, in the same manner and to
the same extent as such requirements apply in the case of physicians
making such certifications under title XVIII of such Act.
SEC. 1640. EXTENSION OF TESTIMONIAL SUBPOENA AUTHORITY TO PROGRAM
EXCLUSION INVESTIGATIONS.
(a) In General.--Section 1128(f) of the Social Security Act (42
U.S.C. 1320a-7(f)) is amended by adding at the end the following new
paragraph:
``(4) The provisions of subsections (d) and (e) of section 205 shall
apply with respect to this section to the same extent as they are
applicable with respect to title II. The Secretary may delegate the
authority granted by section 205(d) (as made applicable to this
section) to the Inspector General of the Department of Health and Human
Services or the Administrator of the Centers for Medicare & Medicaid
Services for purposes of any investigation under this section.''.
(b) Effective Date.--The amendment made by subsection (a) shall apply
to investigations beginning on or after January 1, 2010.
SEC. 1641. REQUIRED REPAYMENTS OF MEDICARE AND MEDICAID OVERPAYMENTS.
Section 1128G of the Social Security Act, as inserted by section 1631
and amended by section 1632, is further amended by adding at the end
the following new subsection:
``(c) Reports on and Repayment of Overpayments Identified Through
Internal Audits and Reviews.--
``(1) Reporting and returning overpayments.--If a person
knows of an overpayment, the person must--
``(A) report and return the overpayment to the
Secretary, the State, an intermediary, a carrier, or a
contractor, as appropriate, at the correct address, and
``(B) notify the Secretary, the State, intermediary,
carrier, or contractor to whom the overpayment was
returned in writing of the reason for the overpayment.
``(2) Timing.--An overpayment must be reported and returned
under paragraph (1)(A) by not later than the date that is 60
days after the date the person knows of the overpayment. Any
known overpayment retained later than the applicable date
specified in this paragraph creates an obligation as defined in
section 3729(b)(3) of title 31 of the United States Code.
``(3) Clarification.--Repayment of any overpayments (or
refunding by withholding of future payments) by a provider of
services or supplier does not otherwise limit the provider or
supplier's potential liability for administrative obligations
such as applicable interests, fines, and specialties or civil
or criminal sanctions involving the same claim if it is
determined later that the reason for the overpayment was
related to fraud by the provider or supplier or the employees
or agents of such provider or supplier.
``(4) Definitions.--In this subsection:
``(A) Knows.--The term `knows' has the meaning given
the terms `knowing' and `knowingly' in section 3729(b)
of title 31 of the United States Code.
``(B) Overpayment.--The term ``overpayment'' means
any finally determined funds that a person receives or
retains under title XVIII, XIX, or XXI to which the
person, after applicable reconciliation, is not
entitled under such title.
``(C) Person.--The term `person' means a provider of
services, supplier, Medicaid managed care organization
(as defined in section 1903(m)(1)(A)), Medicare
Advantage organization (as defined in section
1859(a)(1)), or PDP sponsor (as defined in section
1860D-41(a)(13)), but excluding a beneficiary.''.
SEC. 1642. EXPANDED APPLICATION OF HARDSHIP WAIVERS FOR OIG EXCLUSIONS
TO BENEFICIARIES OF ANY FEDERAL HEALTH CARE
PROGRAM.
Section 1128(c)(3)(B) of the Social Security Act (42 U.S.C. 1320a-
7(c)(3)(B)) is amended by striking ``individuals entitled to benefits
under part A of title XVIII or enrolled under part B of such title, or
both'' and inserting ``beneficiaries (as defined in section
1128A(i)(5)) of that program''.
SEC. 1643. ACCESS TO CERTAIN INFORMATION ON RENAL DIALYSIS FACILITIES.
Section 1881(b) of the Social Security Act (42 U.S.C. 1395rr(b)) is
amended by adding at the end the following new paragraph:
``(15) For purposes of evaluating or auditing payments made to renal
dialysis facilities for items and services under this section under
paragraph (1), each such renal dialysis facility, upon the request of
the Secretary, shall provide to the Secretary access to information
relating to any ownership or compensation arrangement between such
facility and the medical director of such facility or between such
facility and any physician.''.
SEC. 1644. BILLING AGENTS, CLEARINGHOUSES, OR OTHER ALTERNATE PAYEES
REQUIRED TO REGISTER UNDER MEDICARE.
(a) Medicare.--Section 1866(j)(1) of the Social Security Act (42
U.S.C. 1395cc(j)(1)) is amended by adding at the end the following new
subparagraph:
``(D) Billing agents and clearinghouses required to
be registered under medicare.--Any agent,
clearinghouse, or other alternate payee that submits
claims on behalf of a health care provider must be
registered with the Secretary in a form and manner
specified by the Secretary.''.
(b) Medicaid.--For a similar provision with respect to the Medicaid
program under title XIX of the Social Security Act, see section 1759.
(c) Effective Date.--The amendment made by subsection (a) shall apply
to claims submitted on or after January 1, 2012.
SEC. 1645. CONFORMING CIVIL MONETARY PENALTIES TO FALSE CLAIMS ACT
AMENDMENTS.
Section 1128A of the Social Security Act, as amended by sections
1611, 1612, 1613, and 1615, is further amended--
(1) in subsection (a)--
(A) in paragraph (1), by striking ``to an officer,
employee, or agent of the United States, or of any
department or agency thereof, or of any State agency
(as defined in subsection (i)(1))'';
(B) in paragraph (4)--
(i) in the matter preceding subparagraph (A),
by striking ``participating in a program under
title XVIII or a State health care program''
and inserting ``participating in a Federal
health care program (as defined in section
1128B(f))''; and
(ii) in subparagraph (A), by striking ``title
XVIII or a State health care program'' and
inserting ``a Federal health care program (as
defined in section 1128B(f))'';
(C) by striking ``or'' at the end of paragraph (10);
(D) by inserting after paragraph (11) the following
new paragraphs:
``(12) conspires to commit a violation of this section; or
``(13) knowingly makes, uses, or causes to be made or used, a
false record or statement material to an obligation to pay or
transmit money or property to a Federal health care program, or
knowingly conceals or knowingly and improperly avoids or
decreases an obligation to pay or transmit money or property to
a Federal health care program;''; and
(E) in the matter following paragraph (13), as
inserted by subparagraph (D),--
(i) by striking ``or'' before ``in cases
under paragraph (11)''; and
(ii) by inserting ``, in cases under
paragraph (12), $50,000 for any violation
described in this section committed in
furtherance of the conspiracy involved; or in
cases under paragraph (13), $50,000 for each
false record or statement, or concealment,
avoidance, or decrease'' after ``by an excluded
individual''; and
(F) in the second sentence, by striking ``such false
statement, omission, or misrepresentation)'' and
inserting ``such false statement or misrepresentation,
in cases under paragraph (12), an assessment of not
more than 3 times the total amount that would otherwise
apply for any violation described in this section
committed in furtherance of the conspiracy involved, or
in cases under paragraph (13), an assessment of not
more than 3 times the total amount of the obligation to
which the false record or statment was material or that
was avoided or decreased)''.
(2) in subsection (c)(1), by striking ``six years'' and
inserting ``10 years''; and
(3) in subsection (i)--
(A) by amending paragraph (2) to read as follows:
``(2) The term `claim' means any application, request, or
demand, whether under contract, or otherwise, for money or
property for items and services under a Federal health care
program (as defined in section 1128B(f)), whether or not the
United States or a State agency has title to the money or
property, that--
``(A) is presented or caused to be presented to an
officer, employee, or agent of the United States, or of
any department or agency thereof, or of any State
agency (as defined in subsection (i)(1)); or
``(B) is made to a contractor, grantee, or other
recipient if the money or property is to be spent or
used on the Federal health care program's behalf or to
advance a Federal health care program interest, and if
the Federal health care program--
``(i) provides or has provided any portion of
the money or property requested or demanded; or
``(ii) will reimburse such contractor,
grantee, or other recipient for any portion of
the money or property which is requested or
demanded.'';
(B) by amending paragraph (3) to read as follows:
``(3) The term `item or service' means, without limitation,
any medical, social, management, administrative, or other item
or service used in connection with or directly or indirectly
related to a Federal health care program.'';
(C) in paragraph (6)--
(i) in subparagraph (C), by striking at the
end ``or'';
(ii) in the first subparagraph (D), by
striking at the end the period and inserting
``; or''; and
(iii) by redesignating the second
subparagraph (D) as a subparagraph (E);
(D) by amending paragraph (7) to read as follows:
``(7) The terms `knowing', `knowingly', and `should know'
mean that a person, with respect to information--
``(A) has actual knowledge of the information;
``(B) acts in deliberate ignorance of the truth or
falsity of the information; or
``(C) acts in reckless disregard of the truth or
falsity of the information;
and require no proof of specific intent to defraud.''; and
(E) by adding at the end the following new
paragraphs:
``(8) The term `obligation' means an established duty,
whether or not fixed, arising from an express or implied
contractual, grantor-grantee, or licensor-licensee
relationship, from a fee-based or similar relationship, from
statute or regulation, or from the retention of any
overpayment.
``(9) The term `material' means having a natural tendency to
influence, or be capable of influencing, the payment or receipt
of money or property.''.
Subtitle D--Access to Information Needed To Prevent Fraud, Waste, and
Abuse
SEC. 1651. ACCESS TO INFORMATION NECESSARY TO IDENTIFY FRAUD, WASTE,
AND ABUSE.
Section 1128G of the Social Security Act, as added by section 1631
and amended by sections 1632 and 1641, is further amended by adding at
the end the following new subsection;
``(d) Access to Information Necessary to Identify Fraud, Waste, and
Abuse.--For purposes of law enforcement activity, and to the extent
consistent with applicable disclosure, privacy, and security laws,
including the Health Insurance Portability and Accountability Act of
1996 and the Privacy Act of 1974, and subject to any information
systems security requirements enacted by law or otherwise required by
the Secretary, the Attorney General shall have access, facilitation by
the Inspector General of the Department of Health and Human Services,
to claims and payment data relating to titles XVIII and XIX, in
consultation with the Centers for Medicare & Medicaid Services or the
owner of such data.''.
SEC. 1652. ELIMINATION OF DUPLICATION BETWEEN THE HEALTHCARE INTEGRITY
AND PROTECTION DATA BANK AND THE NATIONAL
PRACTITIONER DATA BANK.
(a) In General.--To eliminate duplication between the Healthcare
Integrity and Protection Data Bank (HIPDB) established under section
1128E of the Social Security Act and the National Practitioner Data
Bank (NPBD) established under the Health Care Quality Improvement Act
of 1986, section 1128E of the Social Security Act (42 U.S.C. 1320a-7e)
is amended--
(1) in subsection (a), by striking ``Not later than'' and
inserting ``Subject to subsection (h), not later than'';
(2) in the first sentence of subsection (d)(2), by striking
``(other than with respect to requests by Federal agencies)'';
and
(3) by adding at the end the following new subsection:
``(h) Sunset of the Healthcare Integrity and Protection Data Bank;
Transition Process.--Effective upon the enactment of this subsection,
the Secretary shall implement a process to eliminate duplication
between the Healthcare Integrity and Protection Data Bank (in this
subsection referred to as the `HIPDB' established pursuant to
subsection (a) and the National Practitioner Data Bank (in this
subsection referred to as the `NPDB') as implemented under the Health
Care Quality Improvement Act of 1986 and section 1921 of this Act,
including systems testing necessary to ensure that information formerly
collected in the HIPDB will be accessible through the NPDB, and other
activities necessary to eliminate duplication between the two data
banks. Upon the completion of such process, notwithstanding any other
provision of law, the Secretary shall cease the operation of the HIPDB
and shall collect information required to be reported under the
preceding provisions of this section in the NPDB. Except as otherwise
provided in this subsection, the provisions of subsections (a) through
(g) shall continue to apply with respect to the reporting of (or
failure to report), access to, and other treatment of the information
specified in this section.''.
(b) Elimination of the Responsibility of the HHS Office of the
Inspector General.--Section 1128C(a)(1) of the Social Security Act (42
U.S.C. 1320a-7c(a)(1)) is amended--
(1) in subparagraph (C), by adding at the end ``and'';
(2) in subparagraph (D), by striking at the end ``, and'' and
inserting a period; and
(3) by striking subparagraph (E).
(c) Special Provision for Access to the National Practitioner Data
Bank by the Department of Veterans Affairs.--
(1) In general.--Notwithstanding any other provision of law,
during the one year period that begins on the effective date
specified in subsection (e)(1), the information described in
paragraph (2) shall be available from the National Practitioner
Data Bank (described in section 1921 of the Social Security
Act) to the Secretary of Veterans Affairs without charge.
(2) Information described.--For purposes of paragraph (1),
the information described in this paragraph is the information
that would, but for the amendments made by this section, have
been available to the Secretary of Veterans Affairs from the
Healthcare Integrity and Protection Data Bank.
(d) Funding.--Notwithstanding any provisions of this Act, sections
1128E(d)(2) and 1817(k)(3) of the Social Security Act, or any other
provision of law, there shall be available for carrying out the
transition process under section 1128E(h) of the Social Security Act
over the period required to complete such process, and for operation of
the National Practitioner Data Bank until such process is completed,
without fiscal year limitation--
(1) any fees collected pursuant to section 1128E(d)(2) of
such Act; and
(2) such additional amounts as necessary, from appropriations
available to the Secretary and to the Office of the Inspector
General of the Department of Health and Human Services under
clauses (i) and (ii), respectively, of section 1817(k)(3)(A) of
such Act, for costs of such activities during the first 12
months following the date of the enactment of this Act.
(e) Effective Date.--The amendments made--
(1) by subsection (a)(2) shall take effect on the first day
after the Secretary of Health and Human Services certifies that
the process implemented pursuant to section 1128E(h) of the
Social Security Act (as added by subsection (a)(3)) is
complete; and
(2) by subsection (b) shall take effect on the earlier of the
date specified in paragraph (1) or the first day of the second
succeeding fiscal year after the fiscal year during which this
Act is enacted.
SEC. 1653. COMPLIANCE WITH HIPAA PRIVACY AND SECURITY STANDARDS.
The provisions of sections 262(a) and 264 of the Health Insurance
Portability and Accountability Act of 1996 (and standards promulgated
pursuant to such sections) and the Privacy Act of 1974 shall apply with
respect to the provisions of this subtitle and amendments made by this
subtitle.
TITLE VII--MEDICAID AND CHIP
Subtitle A--Medicaid and Health Reform
SEC. 1701. ELIGIBILITY FOR INDIVIDUALS WITH INCOME BELOW 133\1/3\
PERCENT OF THE FEDERAL POVERTY LEVEL.
(a) Eligibility for Non-traditional Individuals With Income Below
133\1/3\ Percent of the Federal Poverty Level.--
(1) In general.--Section 1902(a)(10)(A)(i) of the Social
Security Act (42 U.S.C. 1396b(a)(10)(A)(i) is amended--
(A) by striking ``or'' at the end of subclause (VI);
(B) by adding ``or'' at the end of subclause (VII);
and
(C) by adding at the end the following new subclause:
``(VIII) who are under 65 years of
age, who are not described in a
previous subclause of this clause, and
who are in families whose income
(determined using methodologies and
procedures specified by the Secretary
in consultation with the Health Choices
Commissioner) does not exceed 133\1/3\
percent of the income official poverty
line (as defined by the Office of
Management and Budget, and revised
annually in accordance with section
673(2) of the Omnibus Budget
Reconciliation Act of 1981) applicable
to a family of the size involved;''.
(2) Increased fmap for non-traditional medicaid eligible
individuals.--Section 1905 of such Act (42 U.S.C. 1396d) is
amended--
(A) in the first sentence of subsection (b), by
striking ``and'' before ``(4)'' and by inserting before
the period at the end the following: ``, and (5) 100
percent (or 90 percent for periods beginning with 2015)
with respect to amounts described in subsection (y)'';
and
(B) by adding at the end the following new
subsection:
``(y) Additional Expenditures Subject to Increased FMAP.--For
purposes of section 1905(b)(5), the amounts described in this
subsection are the following:
``(1) Amounts expended for medical assistance for individuals
described in subclause (VIII) of section 1902(a)(10)(A)(i).''.
(3) Construction.--Nothing in this subsection shall be
construed as not providing for coverage under subclause (VIII)
of section 1902(a)(10)(A)(i) of the Social Security Act, as
added by paragraph (1) of, and an increased FMAP under the
amendment made by paragraph (2) for, an individual who has been
provided medical assistance under title XIX of the Act under a
demonstration waiver approved under section 1115 of such Act or
with State funds.
(4) Conforming amendments.--
(A) Section 1903(f)(4) of the Social Security Act (42
U.S.C. 1396b(f)(4)) is amended by inserting
``1902(a)(10)(A)(i)(VIII),'' after
``1902(a)(10)(A)(i)(VII),''.
(B) Section 1905(a) of such Act (42 U.S.C. 1396d(a)),
as amended by sections 1714(a)(4) and 1731(c), is
further amended, in the matter preceding paragraph
(1)--
(i) by striking ``or'' at the end of clause
(xiv);
(ii) by adding ``or'' at the end of clause
(xv); and
(iii) by inserting after clause (xv) the
following:
``(xvi) individuals described in section
1902(a)(10)(A)(i)(VIII),''.
(b) Eligibility for Traditional Medicaid Eligible Individuals With
Income Not Exceeding 133\1/3\ Percent of the Federal Poverty Level .--
(1) In general.--Section 1902(a)(10)(A)(i) of the Social
Security Act (42 U.S.C. 1396b(a)(10)(A)(i)), as amended by
subsection (a), is amended--
(A) by striking ``or'' at the end of subclause (VII);
(B) by adding ``or'' at the end of subclause (VIII);
and
(C) by adding at the end the following new subclause:
``(IX) who are under 65 years of age,
who would be eligible for medical
assistance under the State plan under
one of subclauses (I) through (VII)
(based on the income standards,
methodologies, and procedures in effect
as of June 16, 2009) but for income and
who are in families whose income does
not exceed 133\1/3\ percent of the
income official poverty line (as
defined by the Office of Management and
Budget, and revised annually in
accordance with section 673(2) of the
Omnibus Budget Reconciliation Act of
1981) applicable to a family of the
size involved;''.
(2) Increased fmap for certain traditional medicaid eligible
individuals.--Section 1905(y) of such Act (42 U.S.C. 1396d(b)),
as added by subsection (a)(2)(B), is amended by inserting ``or
(IX)'' after ``(VIII)''.
(3) Construction.--Nothing in this subsection shall be
construed as not providing for coverage under subclause (IX) of
section 1902(a)(10)(A)(i) of the Social Security Act, as added
by paragraph (1) of, and an increased FMAP under the amendment
made by paragraph (2) for, an individual who has been provided
medical assistance under title XIX of the Act under a
demonstration waiver approved under section 1115 of such Act or
with State funds.
(4) Conforming amendment.--Section 1903(f)(4) of the Social
Security Act (42 U.S.C. 1396b(f)(4)), as amended by subsection
(a)(4), is amended by inserting ``1902(a)(10)(A)(i)(IX),''
after ``1902(a)(10)(A)(i)(VIII),''.
(c) Increased Matching Rate for Temporary Coverage of Certain
Newborns.--Section 1905(y) of such Act, as added by subsection
(a)(2)(B), is amended--
(1) in paragraph (1), by inserting before the period at the
end the following: ``, and who is not provided medical
assistance under section 1943(b)(2) of this title or section
205(d)(1)(B) of the America's Affordable Health Choices Act of
2009''; and
(2) by adding at the end the following:
``(2) Amounts expended for medical assistance for children
described in section 203(d)(1)(A) of the America's Affordable
Health Choices Act of 2009 during the time period specified in
such section.''.
(d) Network Adequacy.--Section 1932(a)(2) of the Social Security Act
(42 U.S.C. 1396u-2(a)(2)) is amended by adding at the end the following
new subparagraph:
``(D) Enrollment of non-traditional medicaid
eligibles.--A State may not require under paragraph (1)
the enrollment in a managed care entity of an
individual described in section 1902(a)(10)(A)(i)(VIII)
unless the State demonstrates, to the satisfaction of
the Secretary, that the entity, through its provider
network and other arrangements, has the capacity to
meet the health, mental health, and substance abuse
needs of such individuals.''.
(e) Effective Date.--The amendments made by this section shall take
effect on the first day of Y1, and shall apply with respect to items
and services furnished on or after such date.
SEC. 1702. REQUIREMENTS AND SPECIAL RULES FOR CERTAIN MEDICAID ELIGIBLE
INDIVIDUALS.
(a) In General.--Title XIX of the Social Security Act is amended by
adding at the end the following new section:
`` requirements and special rules for certain medicaid eligible
individuals
``Sec. 1943. (a) Coordination With NHI Exchange Through Memorandum
of Understanding.--
``(1) In general.--The State shall enter into a Medicaid
memorandum of understanding described in section 205(e)(3) of
the America's Affordable Health Choices Act of 2009 with the
Health Choices Commissioner, acting in consultation with the
Secretary, with respect to coordinating the implementation of
the provisions of division A of such Act with the State plan
under this title in order to ensure the enrollment of Medicaid
eligible individuals in acceptable coverage. Nothing in this
section shall be construed as permitting such memorandum to
modify or vitiate any requirement of a State plan under this
title.
``(2) Enrollment of exchange-referred individuals.--
``(A) Non-traditional individuals.--Pursuant to such
memorandum the State shall accept without further
determination the enrollment under this title of an
individual determined by the Commissioner to be a non-
traditional Medicaid eligible individual. The State
shall not do any redeterminations of eligibility for
such individuals unless the periodicity of such
redeterminations is consistent with the periodicity for
redeterminations by the Commissioner of eligibility for
affordability credits under subtitle C of title II of
division A of the America's Affordable Health Choices
Act of 2009, as specified under such memorandum.
``(B) Traditional individuals.--Pursuant to such
memorandum, the State shall accept without further
determination the enrollment under this title of an
individual determined by the Commissioner to be a
traditional Medicaid eligible individual. The State may
do redeterminations of eligibility of such individual
consistent with such section and the memorandum.
``(3) Determinations of eligibility for affordability
credits.--If the Commissioner determines that a State Medicaid
agency has the capacity to make determinations of eligibility
for affordability credits under subtitle C of title II of
division A of the America's Affordable Health Choices Act of
2009, under such memorandum--
``(A) the State Medicaid agency shall conduct such
determinations for any Exchange-eligible individual who
requests such a determination;
``(B) in the case that a State Medicaid agency
determines that an Exchange-eligible individual is not
eligible for affordability credits, the agency shall
forward the information on the basis of which such
determination was made to the Commissioner; and
``(C) the Commissioner shall reimburse the State
Medicaid agency for the costs of conducting such
determinations.
``(b) Treatment of Certain Newborns.--
``(1) In general.--In the case of a child who is deemed under
section 205(d)(1) of the America's Affordable Health Choices
Act of 2009 to be a non-traditional Medicaid eligible
individual and enrolled under this title pursuant to such
section, the State shall provide for a determination, by not
later than the end of the period referred to in subparagraph
(A) of such section, of the child's eligibility for medical
assistance under this title.
``(2) Extended treatment as traditional medicaid eligible
individual.--In accordance with subparagraph (B) of section
205(d)(1) of the America's Affordable Health Choices Act of
2009, in the case of a child described in subparagraph (A) of
such section who at the end of the period referred to in such
subparagraph is not otherwise covered under acceptable
coverage, the child shall be deemed (until such time as the
child obtains such coverage or the State otherwise makes a
determination of the child's eligibility for medical assistance
under its plan under this title pursuant to paragraph (1)) to
be a traditional Medicaid eligible individual described in
section 1902(l)(1)(B).
``(c) Definitions.--In this section:
``(1) Medicaid eligible individuals.--In this section, the
terms `Medicaid eligible individual', `traditional Medicaid
eligible individual', and `non-traditional Medicaid eligible
individual' have the meanings given such terms in section
205(e)(4) of the America's Affordable Health Choices Act of
2009.
``(2) Memorandum.--The term `memorandum' means a Medicaid
memorandum of understanding under section 205(e)(3) of the
America's Affordable Health Choices Act of 2009.
``(3) Y1.--The term `Y1' has the meaning given such term in
section 100(c) of the America's Affordable Health Choices Act
of 2009.''.
(b) Conforming Amendments to Error Rate.--
(1) Section 1903(u)(1)(D) of the Social Security Act (42
U.S.C. 1396b(u)(1)(D)) is amended by adding at the end the
following new clause:
``(vi) In determining the amount of erroneous excess payments, there
shall not be included any erroneous payments made that are attributable
to an error in an eligibility determination under subtitle C of title
II of division A of the America's Affordable Health Choices Act of
2009.''.
(2) Section 2105(c)(11) of such Act (42 U.S.C. 1397ee(c)(11))
is amended by adding at the end the following new sentence:
``Clause (vi) of section 1903(u)(1)(D) shall apply with respect
to the application of such requirements under this title and
title XIX.''.
SEC. 1703. CHIP AND MEDICAID MAINTENANCE OF ELIGIBILITY.
(a) CHIP Maintenance of Eligibility.--Section 1902 of the Social
Security Act (42 U.S.C. 1396a) is amended--
(1) in subsection (a), as amended by section 1631(b)(1)(D)--
(A) by striking ``and'' at the end of paragraph (73);
(B) by striking the period at the end of paragraph
(74) and inserting ``; and''; and
(C) by inserting after paragraph (74) the following
new paragraph:
``(75) provide for maintenance of effort under the State
child health plan under title XXI in accordance with subsection
(gg).''; and
(2) by adding at the end the following new subsection:
``(gg) CHIP Maintenance of Eligibility Requirement.--
``(1) In general.--Subject to paragraph (2), as a condition
of its State plan under this title under subsection (a)(75) and
receipt of any Federal financial assistance under section
1903(a) for calendar quarters beginning after the date of the
enactment of this subsection and before CHIP MOE termination
date specified in paragraph (3), a State shall not have in
effect eligibility standards, methodologies, or procedures
under its State child health plan under title XXI (including
any waiver under such title or under section 1115 that is
permitted to continue effect) that are more restrictive than
the eligibility standards, methodologies, or procedures,
respectively, under such plan (or waiver) as in effect on June
16, 2009.
``(2) Limitation.--Paragraph (1) shall not be construed as
preventing a State from imposing a limitation described in
section 2110(b)(5)(C)(i)(II) for a fiscal year in order to
limit expenditures under its State child health plan under
title XXI to those for which Federal financial participation is
available under section 2105 for the fiscal year.
``(3) CHIP moe termination date.--In paragraph (1), the `CHIP
MOE termination date' for a State is the date that is the first
day of Y1 (as defined in section 100(c) of the America's
Affordable Health Choices Act of 2009) or, if later, the first
day after such date that both of the following determinations
have been made:
``(A) The Health Choices Commissioner has determined
that the Health Insurance Exchange has the capacity to
support the participation of CHIP enrollees who are
Exchange-eligible individuals (as defined in section
202(b) of the America's Affordable Health Choices Act
of 2009),
``(B) The Secretary has determined that--
``(i) comparable coverage, as specified in
section 202(g) of the America's Affordable
Health Choices Act of 2009, is available
through such Exchange; and
``(ii) procedures have been established for
transferring CHIP enrollees into acceptable
coverage (as defined for purposes of such Act)
without interruption of coverage or a written
plan of treatment.
The Secretary shall recommend to Congress any legislative
changes needed to effectuate this paragraph. In this paragraph,
the term `CHIP enrollee' means a targeted low-income child or
(if the State has elected the option under section 2112, a
targeted low-income pregnant woman) who is or otherwise would
be (but for acceptable coverage) eligible for child health
assistance or pregnancy-related assistance, respectively, under
the State child health plan referred to in paragraph (1).''.
(b) Medicaid Maintenance of Effort; Simplifying and Coordinating
Eligibility Rules Between Exchange and Medicaid.--
(1) In general.--Section 1903 of such Act (42 U.S.C. 1396b)
is amended by adding at the end the following new subsection:
``(aa) Maintenance of Medicaid Effort; Simplifying and Coordinating
Eligibility Rules Between Health Insurance Exchange and Medicaid.--
``(1) Maintenance of effort.--
``(A) In general.--Subject to subparagraph (B), a
State is not eligible for payment under subsection (a)
for a calendar quarter beginning after the date of the
enactment of this subsection if eligibility standards,
methodologies, or procedures under its plan under this
title (including any waiver under this title or under
section 1115 that is permitted to continue effect) that
are more restrictive than the eligibility standards,
methodologies, or procedures, respectively, under such
plan (or waiver) as in effect on June 16, 2009. The
Secretary shall extend such a waiver (including the
availability of Federal financial participation under
such waiver) for such period as may be required for a
State to meet the requirement of the previous sentence.
``(B) Exception for certain waivers.--In the case of
a State waiver under section 1115 in effect on June 16,
2009, that permits individuals to be eligible solely to
receive a premium or cost-sharing subsidy for
individual or group health insurance coverage,
effective for coverage provided in Y1--
``(i) the Secretary shall permit the State to
amend such waiver to apply more restrictive
eligibility standards, methodologies, or
procedures with respect to such individuals
under such waiver; and
``(ii) the application of such more
restrictive, standards, methodologies, or
procedures under such an amendment shall not be
considered in violation of the requirement of
subparagraph (A).
``(2) Removal of asset test for certain eligibility
categories.--
``(A) In general.--A State is not eligible for
payment under subsection (a) for a calendar quarter
beginning on or after the first day of Y1 (as defined
in section 100(c) of the America's Affordable Health
Choices Act of 2009), if the State applies any asset or
resource test in determining (or redetermining)
eligibility of any individual on or after such first
day under any of the following:
``(i) Subclause (I), (III), (IV), or (VI) of
section 1902(a)(10)(A)(i).
``(ii) Subclause (II), (IX), (XIV) or (XVII)
of section 1902(a)(10)(A)(ii).
``(iii) Section 1931(b).
``(B) Overriding contrary provisions; references.--
The provisions of this title that prevent the waiver of
an asset or resource test described in subparagraph (A)
are hereby waived.
``(C) References.--Any reference to a provision
described in a provision in subparagraph (A) shall be
deemed to be a reference to such provision as modified
through the application of subparagraphs (A) and
(B).''.
(2) Conforming amendments.--(A) Section 1902(a)(10)(A) of
such Act (42 U.S.C. 1396a(a)(10)(A)) is amended, in the matter
before clause (i), by inserting ``subject to section
1903(aa)(2),'' after ``(A)''.
(B) Section 1931(b)(1) of such Act (42 U.S.C. 1396u-1(b)(1))
is amended by inserting ``and section 1903(aa)(2)'' after ``and
(3)''.
(c) Standards for Benchmark Packages.--Section 1937(b) of such Act
(42 U.S.C. 1396u-7(b)) is amended--
(1) in each of paragraphs (1) and (2), by inserting ``subject
to paragraph (5),'' after ``subsection (a)(1),''; and
(2) by adding at the end the following new paragraph:
``(5) Minimum standards.--Effective January 1, 2013, any
benchmark benefit package (or benchmark equivalent coverage
under paragraph (2)) must meet the minimum benefits and cost-
sharing standards of a basic plan offered through the Health
Insurance Exchange.''.
SEC. 1704. REDUCTION IN MEDICAID DSH.
(a) Report.--
(1) In general.--Not later than January 1, 2016, the
Secretary of Health and Human Services (in this title referred
to as the ``Secretary'') shall submit to Congress a report
concerning the extent to which, based upon the impact of the
health care reforms carried out under division A in reducing
the number of uninsured individuals, there is a continued role
for Medicaid DSH. In preparing the report, the Secretary shall
consult with community-based health care networks serving low-
income beneficiaries.
(2) Matters to be included.--The report shall include the
following:
(A) Recommendations.--Recommendations regarding--
(i) the appropriate targeting of Medicaid DSH
within States; and
(ii) the distribution of Medicaid DSH among
the States, taking into account the ratio of
the amount of DSH funds allocated to a State to
the number of uninsured individuals in such
State.
(B) Specification of dsh health reform methodology.--
The DSH Health Reform methodology described in
paragraph (2) of subsection (b) for purposes of
implementing the requirements of such subsection.
(3) Coordination with medicare dsh report.--The Secretary
shall coordinate the report under this subsection with the
report on Medicare DSH under section 1112.
(4) Medicaid dsh.--In this section, the term ``Medicaid DSH''
means adjustments in payments under section 1923 of the Social
Security Act for inpatient hospital services furnished by
disproportionate share hospitals.
(b) Medicaid DSH Reductions.--
(1) In general.--The Secretary shall reduce Medicaid DSH so
as to reduce total Federal payments to all States for such
purpose by $1,500,000,000 in fiscal year 2017, $2,500,000,000
in fiscal year 2018, and $6,000,000,000 in fiscal year 2019.
(2) DSH health reform methodology.--The Secretary shall carry
out paragraph (1) through use of a DSH Health Reform
methodology issued by the Secretary that imposes the largest
percentage reductions on the States that--
(A) have the lowest percentages of uninsured
individuals (determined on the basis of audited
hospital cost reports) during the most recent year for
which such data are available; or
(B) do not target their DSH payments on--
(i) hospitals with high volumes of Medicaid
inpatients (as defined in section 1923(b)(1)(A)
of the Social Security Act (42 U.S.C. 1396r-
4(b)(1)(A)); and
(ii) hospitals that have high levels of
uncompensated care (excluding bad debt).
(3) DSH allotment publications.--
(A) In general.--Not later than the publication
deadline specified in subparagraph (B), the Secretary
shall publish in the Federal Register a notice
specifying the DSH allotment to each State under
1923(f) of the Social Security Act for the respective
fiscal year specified in such subparagraph, consistent
with the application of the DSH Health Reform
methodology described in paragraph (2).
(B) Publication deadline.--The publication deadline
specified in this subparagraph is--
(i) January 1, 2016, with respect to DSH
allotments described in subparagraph (A) for
fiscal year 2017;
(ii) January 1, 2017, with respect to DSH
allotments described in subparagraph (A) for
fiscal year 2018; and
(iii) January 1, 2018, with respect to DSH
allotments described in subparagraph (A) for
fiscal year 2019.
(c) Conforming Amendments.--
(1) Section 1923(f) of the Social Security Act (42 U.S.C.
1396r-4(f)) is amended--
(A) by redesignating paragraph (7) as paragraph (8);
and
(B) by inserting after paragraph (6) the following
new paragraph:
``(7) Special rule for fiscal years 2017, 2018, and 2019.--
``(A) Fiscal year 2017.--Notwithstanding paragraph
(2), the total DSH allotments for all States for--
``(i) fiscal year 2017, shall be the total
DSH allotments that would otherwise be
determined under this subsection for such
fiscal year decreased by $1,500,000,000;
``(ii) fiscal year 2018, shall be the total
DSH allotments that would otherwise be
determined under this subsection for such
fiscal year decreased by $2,500,000,000; and
``(iii) fiscal year 2019, shall be the total
DSH allotments that would otherwise be
determined under this subsection for such
fiscal year decreased by $6,000,000,000.''.
(2) The second sentence of section 1923(b)(4) of such Act (42
U.S.C. 1396r-4(b)(4)) is amended by inserting before the period
the following: ``or to affect the authority of the Secretary to
issue and implement the DSH Health Reform methodology under
section 1704(b)(2) of the America's Health Choices Act of
2009''.
(d) Disproportionate Share Hospitals (DSH) and Essential Access
Hospital (EAH) Non-discrimination.--
(1) In general.--Section 1923(d) of the Social Security Act
(42 U.S.C. 1396r-4) is amended by adding at the end the
following new paragraph:
``(4) No hospital may be defined or deemed as a
disproportionate share hospital, or as an essential access
hospital (for purposes of subsection (f)(6)(A)(iv)), under a
State plan under this title or subsection (b) of this section
(including any waiver under section 1115) unless the hospital--
``(A) provides services to beneficiaries under this
title without discrimination on the ground of race,
color, national origin, creed, source of payment,
status as a beneficiary under this title, or any other
ground unrelated to such beneficiary's need for the
services or the availability of the needed services in
the hospital; and
``(B) makes arrangements for, and accepts,
reimbursement under this title for services provided to
eligible beneficiaries under this title.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to expenditures made on or after July 1, 2010.
SEC. 1705. EXPANDED OUTSTATIONING.
(a) In General.--Section 1902(a)(55) of the Social Security Act (42
U.S.C. 1396a(a)(55)) is amended by striking ``under subsection
(a)(10)(A)(i)(IV), (a)(10)(A)(i)(VI), (a)(10)(A)(i)(VII), or
(a)(10)(A)(ii)(IX)'' and inserting ``(including receipt and processing
of applications of individuals for affordability credits under subtitle
C of title II of division A of the America's Affordable Health Choices
Act of 2009 pursuant to a Medicaid memorandum of understanding under
section 1943(a)(1))''.
(b) Effective Date.--
(1) Except as provided in paragraph (2), the amendment made
by subsection (a) shall apply to services furnished on or after
July 1, 2010, without regard to whether or not final
regulations to carry out such amendment have been promulgated
by such date.
(2) In the case of a State plan for medical assistance under
title XIX of the Social Security Act which the Secretary of
Health and Human Services determines requires State legislation
(other than legislation appropriating funds) in order for the
plan to meet the additional requirement imposed by the
amendment made by this section, the State plan shall not be
regarded as failing to comply with the requirements of such
title solely on the basis of its failure to meet this
additional requirement before the first day of the first
calendar quarter beginning after the close of the first regular
session of the State legislature that begins after the date of
the enactment of this Act. For purposes of the previous
sentence, in the case of a State that has a 2-year legislative
session, each year of such session shall be deemed to be a
separate regular session of the State legislature.
Subtitle B--Prevention
SEC. 1711. REQUIRED COVERAGE OF PREVENTIVE SERVICES.
(a) Coverage.--Section 1905 of the Social Security Act (42 U.S.C.
1396d), as amended by section 1701(a)(2)(B), is amended--
(1) in subsection (a)(4)--
(A) by striking ``and'' before ``(C)''; and
(B) by inserting before the semicolon at the end the
following: ``; and (D) preventive services described in
subsection (z)''; and
(2) by adding at the end the following new subsection:
``(z) Preventive Services.--The preventive services described in this
subsection are services not otherwise described in subsection (a) or
(r) that the Secretary determines are--
``(1)(A) recommended with a grade of A or B by the Task Force
for Clinical Preventive Services; or
``(B) vaccines recommended for use as appropriate by the
Director of the Centers for Disease Control and Prevention; and
``(2) appropriate for individuals entitled to medical
assistance under this title.''.
(b) Elimination of Cost-sharing.--
(1) Subsections (a)(2)(D) and (b)(2)(D) of section 1916 of
such Act (42 U.S.C. 1396o) are each amended by inserting
``preventive services described in section 1905(z),'' after
``emergency services (as defined by the Secretary),''.
(2) Section 1916A(a)(1) of such Act (42 U.S.C. 1396o-1
(a)(1)) is amended by inserting ``, preventive services
described in section 1905(z),'' after ``subsection (c)''.
(c) Conforming Amendment.--Section 1928 of such Act (42 U.S.C. 1396s)
is amended--
(1) in subsection (c)(2)(B)(i), by striking ``the advisory
committee referred to in subsection (e)'' and inserting ``the
Director of the Centers for Disease Control and Prevention'';
(2) in subsection (e), by striking ``Advisory Committee'' and
all that follows and inserting ``Director of the Centers for
Disease Control and Prevention.''; and
(3) by striking subsection (g).
(d) Effective Date.--
(1) Except as provided in paragraph (2), the amendments made
by this section shall apply to services furnished on or after
July 1, 2010, without regard to whether or not final
regulations to carry out such amendments have been promulgated
by such date.
(2) In the case of a State plan for medical assistance under
title XIX of the Social Security Act which the Secretary of
Health and Human Services determines requires State legislation
(other than legislation appropriating funds) in order for the
plan to meet the additional requirements imposed by the
amendments made by this section, the State plan shall not be
regarded as failing to comply with the requirements of such
title solely on the basis of its failure to meet these
additional requirements before the first day of the first
calendar quarter beginning after the close of the first regular
session of the State legislature that begins after the date of
the enactment of this Act. For purposes of the previous
sentence, in the case of a State that has a 2-year legislative
session, each year of such session shall be deemed to be a
separate regular session of the State legislature.
SEC. 1712. TOBACCO CESSATION.
(a) Dropping Tobacco Cessation Exclusion From Covered Outpatient
Drugs.--Section 1927(d)(2) of the Social Security Act (42 U.S.C. 1396r-
8(d)(2)) is amended--
(1) by striking subparagraph (E);
(2) in subparagraph (G), by inserting before the period at
the end the following: ``, except agents approved by the Food
and Drug Administration for purposes of promoting, and when
used to promote, tobacco cessation''; and
(3) by redesignating subparagraphs (F) through (K) as
subparagraphs (E) through (J), respectively.
(b) Effective Date.--The amendments made by this section shall apply
to drugs and services furnished on or after January 1, 2010.
SEC. 1713. OPTIONAL COVERAGE OF NURSE HOME VISITATION SERVICES.
(a) In General.--Section 1905 of the Social Security Act (42 U.S.C.
1396d), as amended by sections 1701(a)(2) and 1711(a), is amended--
(1) in subsection (a)--
(A) in paragraph (27), by striking ``and'' at the
end;
(B) by redesignating paragraph (28) as paragraph
(29); and
(C) by inserting after paragraph (27) the following
new paragraph:
``(28) nurse home visitation services (as defined in
subsection (aa)); and''; and
(2) by adding at the end the following new subsection:
``(aa) The term `nurse home visitation services' means home visits by
trained nurses to families with a first-time pregnant woman, or a child
(under 2 years of age), who is eligible for medical assistance under
this title, but only, to the extent determined by the Secretary based
upon evidence, that such services are effective in one or more of the
following:
``(1) Improving maternal or child health and pregnancy
outcomes or increasing birth intervals between pregnancies.
``(2) Reducing the incidence of child abuse, neglect, and
injury, improving family stability (including reduction in the
incidence of intimate partner violence), or reducing maternal
and child involvement in the criminal justice system.
``(3) Increasing economic self-sufficiency, employment
advancement, school-readiness, and educational achievement, or
reducing dependence on public assistance.''.
(b) Effective Date.--The amendments made by this section shall apply
to services furnished on or after January 1, 2010.
(c) Construction.--Nothing in the amendments made by this section
shall be construed as affecting the ability of a State under title XIX
or XXI of the Social Security Act to provide nurse home visitation
services as part of another class of items and services falling within
the definition of medical assistance or child health assistance under
the respective title, or as an administrative expenditure for which
payment is made under section 1903(a) or 2105(a) of such Act,
respectively, on or after the date of the enactment of this Act.
SEC. 1714. STATE ELIGIBILITY OPTION FOR FAMILY PLANNING SERVICES.
(a) Coverage as Optional Categorically Needy Group.--
(1) In general.--Section 1902(a)(10)(A)(ii) of the Social
Security Act (42 U.S.C. 1396a(a)(10)(A)(ii)) is amended--
(A) in subclause (XVIII), by striking ``or'' at the
end;
(B) in subclause (XIX), by adding ``or'' at the end;
and
(C) by adding at the end the following new subclause:
``(XX) who are described in
subsection (hh) (relating to
individuals who meet certain income
standards);''.
(2) Group described.--Section 1902 of such Act (42 U.S.C.
1396a), as amended by section 1703, is amended by adding at the
end the following new subsection:
``(hh)(1) Individuals described in this subsection are individuals--
``(A) whose income does not exceed an income
eligibility level established by the State that does
not exceed the highest income eligibility level
established under the State plan under this title (or
under its State child health plan under title XXI) for
pregnant women; and
``(B) who are not pregnant.
``(2) At the option of a State, individuals described in this
subsection may include individuals who, had individuals applied on or
before January 1, 2007, would have been made eligible pursuant to the
standards and processes imposed by that State for benefits described in
clause (XV) of the matter following subparagraph (G) of section
subsection (a)(10) pursuant to a waiver granted under section 1115.
``(3) At the option of a State, for purposes of subsection
(a)(17)(B), in determining eligibility for services under this
subsection, the State may consider only the income of the applicant or
recipient.''.
(3) Limitation on benefits.--Section 1902(a)(10) of such Act
(42 U.S.C. 1396a(a)(10)) is amended in the matter following
subparagraph (G)--
(A) by striking ``and (XIV)'' and inserting
``(XIV)''; and
(B) by inserting ``, and (XV) the medical assistance
made available to an individual described in subsection
(hh) shall be limited to family planning services and
supplies described in section 1905(a)(4)(C) including
medical diagnosis and treatment services that are
provided pursuant to a family planning service in a
family planning setting'' after ``cervical cancer''.
(4) Conforming amendments.--Section 1905(a) of such Act (42
U.S.C. 1396d(a)), as amended by section 1731(c), is amended in
the matter preceding paragraph (1)--
(A) in clause (xiii), by striking ``or'' at the end;
(B) in clause (xiv), by adding ``or'' at the end; and
(C) by inserting after clause (xiv) the following:
``(xv) individuals described in section 1902(hh),''.
(b) Presumptive Eligibility.--
(1) In general.--Title XIX of the Social Security Act (42
U.S.C. 1396 et seq.) is amended by inserting after section
1920B the following:
``presumptive eligibility for family planning services
``Sec. 1920C. (a) State Option.--State plan approved under section
1902 may provide for making medical assistance available to an
individual described in section 1902(hh) (relating to individuals who
meet certain income eligibility standard) during a presumptive
eligibility period. In the case of an individual described in section
1902(hh), such medical assistance shall be limited to family planning
services and supplies described in 1905(a)(4)(C) and, at the State's
option, medical diagnosis and treatment services that are provided in
conjunction with a family planning service in a family planning
setting.
``(b) Definitions.--For purposes of this section:
``(1) Presumptive eligibility period.--The term `presumptive
eligibility period' means, with respect to an individual
described in subsection (a), the period that--
``(A) begins with the date on which a qualified
entity determines, on the basis of preliminary
information, that the individual is described in
section 1902(hh); and
``(B) ends with (and includes) the earlier of--
``(i) the day on which a determination is
made with respect to the eligibility of such
individual for services under the State plan;
or
``(ii) in the case of such an individual who
does not file an application by the last day of
the month following the month during which the
entity makes the determination referred to in
subparagraph (A), such last day.
``(2) Qualified entity.--
``(A) In general.--Subject to subparagraph (B), the
term `qualified entity' means any entity that--
``(i) is eligible for payments under a State
plan approved under this title; and
``(ii) is determined by the State agency to
be capable of making determinations of the type
described in paragraph (1)(A).
``(B) Rule of construction.--Nothing in this
paragraph shall be construed as preventing a State from
limiting the classes of entities that may become
qualified entities in order to prevent fraud and abuse.
``(c) Administration.--
``(1) In general.--The State agency shall provide qualified
entities with--
``(A) such forms as are necessary for an application
to be made by an individual described in subsection (a)
for medical assistance under the State plan; and
``(B) information on how to assist such individuals
in completing and filing such forms.
``(2) Notification requirements.--A qualified entity that
determines under subsection (b)(1)(A) that an individual
described in subsection (a) is presumptively eligible for
medical assistance under a State plan shall--
``(A) notify the State agency of the determination
within 5 working days after the date on which
determination is made; and
``(B) inform such individual at the time the
determination is made that an application for medical
assistance is required to be made by not later than the
last day of the month following the month during which
the determination is made.
``(3) Application for medical assistance.--In the case of an
individual described in subsection (a) who is determined by a
qualified entity to be presumptively eligible for medical
assistance under a State plan, the individual shall apply for
medical assistance by not later than the last day of the month
following the month during which the determination is made.
``(d) Payment.--Notwithstanding any other provision of law, medical
assistance that--
``(1) is furnished to an individual described in subsection
(a)--
``(A) during a presumptive eligibility period;
``(B) by a entity that is eligible for payments under
the State plan; and
``(2) is included in the care and services covered by the
State plan,
shall be treated as medical assistance provided by such plan for
purposes of clause (4) of the first sentence of section 1905(b).''.
(2) Conforming amendments.--
(A) Section 1902(a)(47) of the Social Security Act
(42 U.S.C. 1396a(a)(47)) is amended by inserting before
the semicolon at the end the following: ``and provide
for making medical assistance available to individuals
described in subsection (a) of section 1920C during a
presumptive eligibility period in accordance with such
section''.
(B) Section 1903(u)(1)(D)(v) of such Act (42 U.S.C.
1396b(u)(1)(D)(v)) is amended--
(i) by striking ``or for'' and inserting
``for''; and
(ii) by inserting before the period the
following: ``, or for medical assistance
provided to an individual described in
subsection (a) of section 1920C during a
presumptive eligibility period under such
section''.
(c) Clarification of Coverage of Family Planning Services and
Supplies.--Section 1937(b) of the Social Security Act (42 U.S.C. 1396u-
7(b)), as amended by section 1703(c)(2), is amended by adding at the
end the following:
``(6) Coverage of family planning services and supplies.--
Notwithstanding the previous provisions of this section, a
State may not provide for medical assistance through enrollment
of an individual with benchmark coverage or benchmark-
equivalent coverage under this section unless such coverage
includes for any individual described in section 1905(a)(4)(C),
medical assistance for family planning services and supplies in
accordance with such section.''.
(d) Effective Date.--The amendments made by this section take effect
on the date of the enactment of this Act and shall apply to items and
services furnished on or after such date.
Subtitle C--Access
SEC. 1721. PAYMENTS TO PRIMARY CARE PRACTITIONERS.
(a) In General.--
(1) Fee-for-service payments.--Section 1902(a)(13) of the
Social Security Act (42 U.S.C. 1396b(a)(13)) is amended--
(A) by striking ``and'' at the end of subparagraph
(A);
(B) by adding ``and'' at the end of subparagraph (B);
and
(C) by adding at the end the following new
subparagraph:
``(C) payment for primary care services (as defined
in section 1848(j)(5)(A), but applied without regard to
clause (ii) thereof) furnished by physicians (or for
services furnished by other health care professionals
that would be primary care services under such section
if furnished by a physician) at a rate not less than 80
percent of the payment rate applicable to such services
and physicians or professionals (as the case may be)
under part B of title XVIII for services furnished in
2010, 90 percent of such rate for services and
physicians (or professionals) furnished in 2011, and
100 percent of such payment rate for services and
physicians (or professionals) furnished in 2012 or a
subsequent year;''.
(2) Under medicaid managed care plans.--Section 1932(f) of
such Act (42 U.S.C. 1396u-2(f)) is amended--
(A) in the heading, by adding at the end the
following: ``; Adequacy of Payment for Primary Care
Services''; and
(B) by inserting before the period at the end the
following: ``and, in the case of primary care services
described in section 1902(a)(13)(C), consistent with
the minimum payment rates specified in such section
(regardless of the manner in which such payments are
made, including in the form of capitation or partial
capitation)''.
(b) Increase in Payment Using Increased FMAP.--Section 1905(y) of the
Social Security Act, as added by section 1701(a)(2)(B) and as amended
by section 1701(c)(2), is amended by adding at the end the following:
``(3)(A) The portion of the amounts expended for medical
assistance for services described in section 1902(a)(13)(C)
furnished on or after January 1, 2010, that is attributable to
the amount by which the minimum payment rate required under
such section (or, by application, section 1932(f)) exceeds the
payment rate applicable to such services under the State plan
as of June 16, 2009.
``(B) Subparagraphs (A) shall not be construed as preventing
the payment of Federal financial participation based on the
Federal medical assistance percentage for amounts in excess of
those specified under such subparagraphs.''.
(c) Effective Date.--The amendments made by this section shall apply
to services furnished on or after January 1, 2010.
SEC. 1722. MEDICAL HOME PILOT PROGRAM.
(a) In General.--The Secretary of Health and Human Services shall
establish under this section a medical home pilot program under which a
State may apply to the Secretary for approval of a medical home pilot
project described in subsection (b) (in this section referred to as a
``pilot project'') for the application of the medical home concept
under title XIX of the Social Security Act. The pilot program shall
operate for a period of up to 5 years.
(b) Pilot Project Described.--
(1) In general.--A pilot project is a project that applies
one or more of the medical home models described in section
1866E(a)(3) of the Social Security Act (as inserted by section
1302(a)) or such other model as the Secretary may approve, to
high need beneficiaries (including medically fragile children
and high-risk pregnant women) who are eligible for medical
assistance under title XIX of the Social Security Act. The
Secretary shall provide for appropriate coordination of the
pilot program under this section with the medical home pilot
program under section 1866E of such Act.
(2) Limitation.--A pilot project shall be for a duration of
not more than 5 years.
(c) Additional Incentives.--In the case of a pilot project, the
Secretary may--
(1) waive the requirements of section 1902(a)(1) of the
Social Security Act (relating to statewideness) and section
1902(a)(10)(B) of such Act (relating to comparability); and
(2) increase to up to 90 percent (for the first 2 years of
the pilot program) or 75 percent (for the next 3 years) the
matching percentage for administrative expenditures (such as
those for community care workers).
(d) Medically Fragile Children.--In the case of a model involving
medically fragile children, the model shall ensure that the patient-
centered medical home services received by each child, in addition to
fulfilling the requirements under 1866E(b)(1) of the Social Security
Act, provide for continuous involvement and education of the parent or
caregiver and for assistance to the child in obtaining necessary
transitional care if a child's enrollment ceases for any reason.
(e) Evaluation; Report.--
(1) Evaluation.--The Secretary, using the criteria described
in section 1866E(g)(1) of the Social Security Act (as inserted
by section 1123), shall conduct an evaluation of the pilot
program under this section.
(2) Report.--Not later than 60 days after the date of
completion of the evaluation under paragraph (1), the Secretary
shall submit to Congress and make available to the public a
report on the findings of the evaluation under such paragraph.
(f) Funding.--The additional Federal financial participation
resulting from the implementation of the pilot program under this
section may not exceed in the aggregate $1,235,000,000 over the 5-year
period of the program.
SEC. 1723. TRANSLATION OR INTERPRETATION SERVICES.
(a) In General.--Section 1903(a)(2)(E) of the Social Security Act (42
U.S.C. 1396b(a)(2)), as added by section 201(b)(2)(A) of the Children's
Health Insurance Program Reauthorization Act of 2009 (Public Law 111-
3), is amended by inserting ``and other individuals'' after ``children
of families''.
(b) Effective Date.--The amendment made by subsection (a) shall apply
to payment for translation or interpretation services furnished on or
after January 1, 2010.
SEC. 1724. OPTIONAL COVERAGE FOR FREESTANDING BIRTH CENTER SERVICES.
(a) In General.--Section 1905 of the Social Security Act (42 U.S.C.
1396d), as amended by section 1713(a), is amended--
(1) in subsection (a)--
(A) by redesignating paragraph (29) as paragraph
(30);
(B) in paragraph (28), by striking at the end
``and''; and
(C) by inserting after paragraph (28) the following
new paragraph:
``(29) freestanding birth center services (as defined in
subsection (l)(3)(A)) and other ambulatory services that are
offered by a freestanding birth center (as defined in
subsection (l)(3)(B)) and that are otherwise included in the
plan; and''; and
(2) in subsection (l), by adding at the end the following new
paragraph:
``(3)(A) The term `freestanding birth center services' means services
furnished to an individual at a freestanding birth center (as defined
in subparagraph (B)), including by a licensed birth attendant (as
defined in subparagraph (C)) at such center.
``(B) The term `freestanding birth center' means a health facility--
``(i) that is not a hospital; and
``(ii) where childbirth is planned to occur away from the
pregnant woman's residence.
``(C) The term `licensed birth attendant' means an individual who is
licensed or registered by the State involved to provide health care at
childbirth and who provides such care within the scope of practice
under which the individual is legally authorized to perform such care
under State law (or the State regulatory mechanism provided by State
law), regardless of whether the individual is under the supervision of,
or associated with, a physician or other health care provider. Nothing
in this subparagraph shall be construed as changing State law
requirements applicable to a licensed birth attendant.''.
(b) Effective Date.--The amendments made by this section shall apply
to items and services furnished on or after the date of the enactment
of this Act.
SEC. 1725. INCLUSION OF PUBLIC HEALTH CLINICS UNDER THE VACCINES FOR
CHILDREN PROGRAM.
Section 1928(b)(2)(A)(iii)(I) of the Social Security Act (42 U.S.C.
1396s(b)(2)(A)(iii)(I)) is amended--
(1) by striking ``or a rural health clinic'' and inserting
``, a rural health clinic''; and
(2) by inserting ``or a public health clinic,'' after
```1905(l)(1)),''.
SEC. 1726. REQUIRING COVERAGE OF SERVICES OF PODIATRISTS.
(a) In General.--Section 1905(a)(5)(A) of the Social Security Act (42
U.S.C. 1396d(a)(5)(A)) is amended by striking ``section 1861(r)(1)''
and inserting ``paragraphs (1) and (3) of section 1861(r)''.
(b) Effective Date.--
(1) In general.--Except as provided in paragraph (2), the
amendment made by subsection (a) shall apply to services
furnished on or after January 1, 2010.
(2) Extension of effective date for state law amendment.--In
the case of a State plan under title XIX of the Social Security
Act (42 U.S.C. 1396 et seq.) which the Secretary of Health and
Human Services determines requires State legislation in order
for the plan to meet the additional requirement imposed by the
amendment made by subsection (a), the State plan shall not be
regarded as failing to comply with the requirements of such
title solely on the basis of its failure to meet these
additional requirements before the first day of the first
calendar quarter beginning after the close of the first regular
session of the State legislature that begins after the date of
enactment of this Act. For purposes of the previous sentence,
in the case of a State that has a 2-year legislative session,
each year of the session is considered to be a separate regular
session of the State legislature.
SEC. 1726A. REQUIRING COVERAGE OF SERVICES OF OPTOMETRISTS.
(a) In General.--Section 1905(a)(5) of the Social Security Act (42
U.S.C. 1396d(a)(5)) is amended--
(1) by striking ``and'' before ``(B)''; and
(2) by inserting before the semicolon at the end the
following: ``, and (C) medical and other health services (as
defined in section 1861(s)) as authorized by State law,
furnished by an optometrist (described in section 1861(r)(4))
to the extent such services may be performed under State law''.
(b) Effective Date.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by subsection (a) shall take effect 90 days
after the date of the enactment of this Act and shall apply to
services furnished or other actions required on or after such
date.
(2) Exception if state legislation required.--In the case of
a State plan for medical assistance under title XIX of the
Social Security Act which the Secretary of Health and Human
Services determines requires State legislation (other than
legislation appropriating funds) in order for the plan to meet
the additional requirements made by the amendments made by
subsection (a), the State plan shall not be regarded as failing
to comply with the requirements of such title solely on the
basis of its failure to meet these additional requirements
before the first day of the first calendar quarter beginning
after the close of the first regular session of the State
legislature that begins after the date of enactment of this
Act. For purposes of the previous sentence, in the case of a
State that has a 2-year legislative session, each year of such
session shall be deemed to be a separate regular session of the
State legislature.
SEC. 1727. THERAPEUTIC FOSTER CARE.
(a) Rule of Construction.--Nothing in this title shall prevent or
limit a State from covering therapeutic foster care for eligible
children in out-of-home placements under section 1905(a) of the Social
Security Act (42 U.S.C. 1396d(a)).
(b) Therapeutic Foster Care Defined.--For purposes of this section,
the term ``therapeutic foster care'' means a foster care program that
provides--
(1) to the child--
(A) structured daily activities that develop,
improve, monitor, and reinforce age-appropriate social,
communications, and behavioral skills;
(B) crisis intervention and crisis support services;
(C) medication monitoring;
(D) counseling; and
(E) case management services; and
(2) specialized training for the foster parent and
consultation with the foster parent on the management of
children with mental illnesses and related health and
developmental conditions.
SEC. 1728. ASSURING ADEQUATE PAYMENT LEVELS FOR SERVICES.
(a) In General.--Title XIX of the Social Security Act is amended by
inserting after section 1925 the following new section:
``assuring adequate payment levels for services
``Sec. 1926. (a) In General.--A State plan under this title shall
not be considered to meet the requirement of section 1902(a)(30)(A) for
a year (beginning with 2011) unless, by not later than April 1 before
the beginning of such year, the State submits to the Secretary an
amendment to the plan that specifies the payment rates to be used for
such services under the plan in such year and includes in such
submission such additional data as will assist the Secretary in
evaluating the State's compliance with such requirement, including data
relating to how rates established for payments to medicaid managed care
organizations under sections 1903(m) and 1932 take into account such
payment rates.
``(b) Secretarial Review.--The Secretary, by not later than 90 days
after the date of submission of a plan amendment under subsection (a),
shall--
``(1) review each such amendment for compliance with the
requirement of section 1902(a)(30)(A); and
``(2) approve or disapprove each such amendment.
If the Secretary disapproves such an amendment, the State shall
immediately submit a revised amendment that meets such requirement.''.
(b) Effective Date.--The amendment made by subsection (a) shall take
effect on the date of the enactment of this Act.
SEC. 1729. PRESERVING MEDICAID COVERAGE FOR YOUTHS UPON RELEASE FROM
PUBLIC INSTITUTIONS.
Section 1902(a) of the Social Security Act (42 U.S.C. 1396a), as
amended by section 1631(b) and 1703(a), is amended--
(1) by striking ``and'' at the end of paragraph (74);
(2) by striking the period at the end of paragraph (75) and
inserting ``; and''; and
(3) by inserting after paragraph (75) the following new
paragraph:
``(76) provide that in the case of any youth who is 18 years
of age or younger, was enrolled for medical assistance under
the State plan immediately before becoming an inmate of a
public institution, is 18 years of age or younger upon release
from such institution, and is eligible for such medical
assistance under the State plan at the time of release from
such institution--
``(A) during the period such youth is incarcerated in
a public institution, the State shall not terminate
eligibility for medical assistance under the State plan
for such youth;
``(B) during the period such youth is incarcerated in
a public institution, the State shall establish a
process that ensures--
``(i) that the State does not claim federal
financial participation for services that are
provided to such youth and that are excluded
under subsection 1905(a)(28)(A); and
``(ii) that the youth receives medical
assistance for which federal participation is
available under this title;
``(C) on or before the date such youth is released
from such institution, the State shall ensure that such
youth is enrolled for medical assistance under this
title, unless and until there is a determination that
the individual is no longer eligible to be so enrolled;
and
``(D) the State shall ensure that enrollment under
subparagraph (C) will be completed before such date so
that the youth can access medical assistance under this
title immediately upon leaving the institution.''
SEC. 1730. QUALITY MEASURES FOR MATERNITY AND ADULT HEALTH SERVICES
UNDER MEDICAID AND CHIP.
Title XI of the Social Security Act (42 U.S.C. 1301 et seq.) is
amended by inserting after section 1139A the following new section:
``SEC. 1139B. QUALITY MEASURES FOR MATERNITY AND ADULT HEALTH SERVICES
UNDER MEDICAID AND CHIP.
``(a) Maternity Care Quality Measures Under Medicaid and CHIP.--
``(1) Development of measures.--No later than January 1,
2011, the Secretary shall develop and publish for comment a
proposed set of measures that accurately describe the quality
of maternity care provided under State plans under titles XIX
and XXI. The Secretary shall publish a final recommended set of
such measures no later than July 1, 2011.
``(2) Standardized reporting format.--No later than January
1, 2012, the Secretary shall develop and publish a standardized
reporting format for maternity care quality measures for use by
State programs under titles XIX and XXI to collect data from
managed care entities and providers and practitioners that
participate in such programs and to report maternity care
quality measures to the Secretary.
``(b) Other Adult Health Quality Measures Under Medicaid.--
``(1) Development of measures.--The Secretary shall develop
quality measures that are not otherwise developed under section
1192 for services received under State plans under title XIX by
individuals who are 21 years of age or older but have not
attained age 65. The Secretary shall publish such quality
measures through notice and comment rulemaking.
``(2) Standardized reporting format.--The Secretary shall
develop and publish a standardized reporting format for quality
measures developed under paragraph (1) and section 1192 for
services furnished under State plans under title XIX to
individuals who are 21 years of age or older but have not
attained age 65 for use under such plans and State plans under
title XXI. The format shall enable State agencies administering
such plans to collect data from managed care entities and
providers and practitioners that participate in such plans and
to report quality measures to the Secretary.
``(c) Development Process.--With respect to the development of
quality measures under subsections (a) and (b)--
``(1) Use of qualified entities.--The Secretary may enter
into agreements with public, nonprofit, or academic
institutions with technical expertise in the area of health
quality measurement to assist in such development. The
Secretary may carry out these agreements by contract, grant, or
otherwise.
``(2) Multi-stakeholder pre-rulemaking input.--The Secretary
shall obtain the input of stakeholders with respect to such
quality measures using a process similar to that described in
section 1808(d).
``(3) Coordination.--The Secretary shall coordinate the
development of such measures under such subsections and with
the development of child health quality measures under section
1139A.
``(d) Annual Report to Congress.--No later than January 1, 2013, and
annually thereafter, the Secretary shall report to the Committee on
Energy and Commerce of the House of Representatives the Committee on
Finance of the Senate regarding--
``(1) the availability of reliable data relating to the
quality of maternity care furnished under State plans under
titles XIX and XXI;
``(2) the availability of reliable data relating to the
quality of services furnished under State plans under title XIX
to adults who are 21 years of age or older but have not
attained age 65; and
``(3) recommendations for improving the quality of such care
and services furnished under such State plans.
``(e) Rule of Construction.--Notwithstanding any other provision in
this section, no quality measure developed, published, or used as a
basis of measurement or reporting under this section may be used to
establish an irrefutable presumption regarding either the medical
necessity of care or the maximum permissible coverage for any
individual who receives medical assistance under title XIX or child
health assistance under title XXI.
``(f) Appropriation.--For purposes of carrying out this section, in
addition to funds otherwise available, out of any funds in the Treasury
not otherwise appropriated, there are appropriated $40,000,000 for the
5-fiscal-year period beginning with fiscal year 2010. Funds
appropriated under this subsection shall remain available until
expended.''.
SEC. 1730A. ACCOUNTABLE CARE ORGANIZATION PILOT PROGRAM.
(a) In General.--The Secretary of Health and Human Services shall
establish under this section an accountable care program under which a
State may apply to the Secretary for approval of an accountable care
organization pilot program described in subsection (b) (in this section
referred to as a ``pilot program'') for the application of the
accountable care organization concept under title XIX of the Social
Security Act.
(b) Pilot Program Described.--
(1) In general.--The pilot program described in this
subsection is a program that applies one or more of the
accountable care organization models described in section 1866E
of the Social Security Act, as added by section 1301 of this
Act.
(2) Limitation.--The pilot program shall operate for a period
of not more than 5 years.
(c) Additional Incentives.--In the case of the pilot program under
this section, the Secretary may--
(1) waive the requirements of--
(A) section 1902(a)(1) of the Social Security Act
(relating to statewideness);
(B) section 1902(a)(10)(B) of such Act (relating to
comparability); and
(2) increase the matching percentage for administrative
expenditures up to--
(A) 90 percent (for the first 2 years of the pilot
program); and
(B) 75 percent (for the next 3 years).
(d) Evaluation; Report.--
(1) Evaluation.--The Secretary, using the criteria described
in section 1866D(f)(1) of the Social Security Act (as inserted
by section 1301 of this Act), shall conduct an evaluation of
the pilot program under this section.
(2) Report.--Not later than 60 days after the date of
completion of the evaluation under paragraph (1), the Secretary
shall submit to Congress and make available to the public a
report on the findings of the evaluation under such paragraph.
Subtitle D--Coverage
SEC. 1731. OPTIONAL MEDICAID COVERAGE OF LOW-INCOME HIV-INFECTED
INDIVIDUALS.
(a) In General.-- Section 1902 of the Social Security Act (42 U.S.C.
1396a), as amended by section 1714(a)(1), is amended--
(1) in subsection (a)(10)(A)(ii)--
(A) by striking ``or'' at the end of subclause (XIX);
(B) by adding ``or'' at the end of subclause (XX);
and
(C) by adding at the end the following:
``(XXI) who are described in
subsection (ii) (relating to HIV-
infected individuals);''; and
(2) by adding at the end, as amended by sections 1703 and
1714(a), the following:
``(ii) Individuals described in this subsection are individuals not
described in subsection (a)(10)(A)(i)--
``(1) who have HIV infection;
``(2) whose income (as determined under the State plan under
this title with respect to disabled individuals) does not
exceed the maximum amount of income a disabled individual
described in subsection (a)(10)(A)(i) may have and obtain
medical assistance under the plan; and
``(3) whose resources (as determined under the State plan
under this title with respect to disabled individuals) do not
exceed the maximum amount of resources a disabled individual
described in subsection (a)(10)(A)(i) may have and obtain
medical assistance under the plan.''.
(b) Enhanced Match.--The first sentence of section 1905(b) of such
Act (42 U.S.C. 1396d(b)) is amended by striking ``section
1902(a)(10)(A)(ii)(XVIII)'' and inserting ``subclause (XVIII) or (XXI)
of section 1902(a)(10)(A)(ii)''.
(c) Conforming Amendments.--Section 1905(a) of such Act (42 U.S.C.
1396d(a)) is amended, in the matter preceding paragraph (1)--
(1) by striking ``or'' at the end of clause (xii);
(2) by adding ``or'' at the end of clause (xiii); and
(3) by inserting after clause (xiii) the following:
``(xiv) individuals described in section 1902(ii),''.
(d) Exemption From Funding Limitation for Territories.--Section
1108(g) of the Social Security Act (42 U.S.C. 1308(g)) is amended by
adding at the end the following:
``(5) Disregarding medical assistance for optional low-income
hiv-infected individuals.--The limitations under subsection (f)
and the previous provisions of this subsection shall not apply
to amounts expended for medical assistance for individuals
described in section 1902(ii) who are only eligible for such
assistance on the basis of section 1902(a)(10)(A)(ii)(XXI).''.
(e) Effective Date; Sunset.--The amendments made by this section
shall apply to expenditures for calendar quarters beginning on or after
the date of the enactment of this Act, and before January 1, 2013,
without regard to whether or not final regulations to carry out such
amendments have been promulgated by such date.
SEC. 1732. EXTENDING TRANSITIONAL MEDICAID ASSISTANCE (TMA).
Sections 1902(e)(1)(B) and 1925(f) of the Social Security Act (42
U.S.C. 1396a(e)(1)(B), 1396r-6(f)), as amended by section 5004(a)(1) of
the American Recovery and Reinvestment Act of 2009 (Public Law 111-5),
are each amended by striking ``December 31, 2010'' and inserting
``December 31, 2012''.
SEC. 1733. REQUIREMENT OF 12-MONTH CONTINUOUS COVERAGE UNDER CERTAIN
CHIP PROGRAMS.
(a) In General.--Section 2102(b) of the Social Security Act (42
U.S.C. 1397bb(b)) is amended by adding at the end the following new
paragraph:
``(6) Requirement for 12-month continuous eligibility.--In
the case of a State child health plan that provides child
health assistance under this title through a means other than
described in section 2101(a)(2), the plan shall provide for
implementation under this title of the 12-month continuous
eligibility option described in section 1902(e)(12) for
targeted low-income children whose family income is below 200
percent of the poverty line.''.
(b) Effective Date.--The amendment made by subsection (a) shall apply
to determinations (and redeterminations) of eligibility made on or
after January 1, 2010.
SEC. 1734. PREVENTING THE APPLICATION UNDER CHIP OF COVERAGE WAITING
PERIODS FOR CERTAIN CHILDREN.
(a) In General.--Section 2102(b)(1) of the Social Security Act (42
U.S.C. 1397bb(b)(1)) is amended--
(1) in subparagraph (B)--
(A) in clause (iii), by striking ``and'' at the end;
(B) in clause (iv), by striking the period at the end
and inserting ``; and''; and
(C) by adding at the end the following new clause:
``(v) may not apply a waiting period
(including a waiting period to carry out
paragraph (3)(C)) in the case of a child
described in subparagraph (C).''; and
(2) by adding at the end the following new subparagraph:
``(C) Description of children not subject to waiting
period.--For purposes of this paragraph, a child
described in this subparagraph is a child who, on the
date an application is submitted for such child for
child health assistance under this title, meets any of
the following requirements:
``(i) Infants and toddlers.--The child is
under two years of age.
``(ii) Loss of group health plan coverage.--
The child previously had private health
insurance coverage through a group health plan
or health insurance coverage offered through an
employer and lost such coverage due to--
``(I) termination of an individual's
employment;
``(II) a reduction in hours that an
individual works for an employer;
``(III) elimination of an
individual's retiree health benefits;
or
``(IV) termination of an individual's
group health plan or health insurance
coverage offered through an employer.
``(iii) Unaffordable private coverage.--
``(I) In general.--The family of the
child demonstrates that the cost of
health insurance coverage (including
the cost of premiums, co-payments,
deductibles, and other cost sharing)
for such family exceeds 10 percent of
the income of such family.
``(II) Determination of family
income.--For purposes of subclause (I),
family income shall be determined in
the same manner specified by the State
for purposes of determining a child's
eligibility for child health assistance
under this title.''.
(b) Effective Date.--The amendments made by this section shall take
effect as of the date that is 90 days after the date of the enactment
of this Act.
SEC. 1735. ADULT DAY HEALTH CARE SERVICES.
(a) In General.--The Secretary of Health and Human Services shall
not--
(1) withhold, suspend, disallow, or otherwise deny Federal
financial participation under section 1903(a) of the Social
Security Act (42 U.S.C. 1396b(a)) for the provision of adult
day health care services, day activity and health services, or
adult medical day care services, as defined under a State
Medicaid plan approved during or before 1994, during such
period if such services are provided consistent with such
definition and the requirements of such plan; or
(2) withdraw Federal approval of any such State plan or part
thereof regarding the provision of such services (by regulation
or otherwise).
(b) Effective Date.--Subsection (a) shall apply with respect to
services provided on or after October 1, 2008.
SEC. 1736. MEDICAID COVERAGE FOR CITIZENS OF FREELY ASSOCIATED STATES.
(a) In General.--Section 402(b)(2) of the Personal Responsibility and
Work Opportunity Reconciliation Act of 1996 (8 U.S.C. 1612(b)(2)) is
amended by adding at the end the following:
``(G) Medicaid exception for citizens of freely
associated states.--With respect to eligibility for
benefits for the designated Federal program defined in
paragraph (3)(C) (relating to the Medicaid program),
section 401(a) and paragraph (1) shall not apply to any
individual who lawfully resides in the United States
(including territories and possessions of the United
States) in accordance with the Compacts of Free
Association between the Government of the United States
and the Governments of the Federated States of
Micronesia, the Republic of the Marshall Islands, and
the Republic of Palau.''.
(b) Exception to 5-year Limited Eligibility.--Section 403(d) of such
Act (8 U.S.C. 1613(d)) is amended--
(1) in paragraph (1), by striking ``or'' at the end;
(2) in paragraph (2), by striking the period at the end and
inserting ``; or''; and
(3) by adding at the end the following:
``(3) an individual described in section 402(b)(2)(G), but
only with respect to the designated Federal program defined in
section 402(b)(3)(C).''.
(c) Definition of Qualified Alien.--Section 431(b) of such Act (8
U.S.C. 1641(b)) is amended--
(1) in paragraph (6), by striking ``; or'' at the end and
inserting a comma;
(2) in paragraph (7), by striking the period at the end and
inserting ``, or''; and
(3) by adding at the end the following:
``(8) an individual who lawfully resides in the United States
(including territories and possessions of the United States) in
accordance with a Compact of Free Association referred to in
section 402(b)(2)(G), but only with respect to the designated
Federal program defined in section 402(b)(3)(C) (relating to
the Medicaid program).''.
SEC. 1737. CONTINUING REQUIREMENT OF MEDICAID COVERAGE OF NONEMERGENCY
TRANSPORTATION TO MEDICALLY NECESSARY SERVICES.
(a) Requirement.--Section 1902(a)(10) of the Social Security Act (42
U.S.C. 1396a(a)(10)) is amended--
(1) in subparagraph (A), in the matter preceding clause (i),
by striking ``and (21)'' and inserting ``, (21), and (28)'';
and
(2) in subparagraph (C)(iv), by striking ``and (17)'' and
inserting ``, (17), and (28)''.
(b) Description of Services.--Section 1905(a) of such Act (42 U.S.C.
1395d(a)), as amended by sections 1713(a)(1) and 1724(a)(1), is
amended--
(1) in paragraph (29), by striking ``and'' at the end;
(2) by redesignating paragraph (30) as pararaph (31) and by
striking the comma at the end and inserting a semicolon; and
(3) by inserting after paragraph (29) the following new
paragraph:
``(30) nonemergency transportation to medically necessary
services, consistent with the requirement of section 431.53 of
title 42, Code of Federal Regulations, as in effect as of June
1, 2008; and''.
(c) Effective Date.--The amendments made by this section shall take
effect on the date of the enactment of this Act and shall apply to
transportation on or after such date.
SEC. 1738. STATE OPTION TO DISREGARD CERTAIN INCOME IN PROVIDING
CONTINUED MEDICAID COVERAGE FOR CERTAIN INDIVIDUALS
WITH EXTREMELY HIGH PRESCRIPTION COSTS.
Section 1902(e) of the Social Security Act (42 U.S.C. 1396b(e)), as
amended by section 203(a) of the Children's Health Insurance Program
Reauthorization Act of 2009 (Public Law 111-3), is amended by adding at
the end the following new paragraph:
``(14)(A) At the option of the State, in the case of an individual
with extremely high prescription drug costs described in subparagraph
(B) who has been determined (without the application of this paragraph)
to be eligible for medical assistance under this title, the State may,
in redetermining the individual's eligibility for medical assistance
under this title, disregard any family income of the individual to the
extent such income is less than an amount that is specified by the
State and does not exceed the amount specified in subparagraph (C), or,
if greater, income equal to the cost of the orphan drugs described in
subparagraph (B)(iii).
``(B) An individual with extremely high prescription drug costs
described in this subparagraph for a 12-month period is an individual--
``(i) who is covered under health insurance or a health
benefits plan that has a maximum lifetime limit of not less
than $1,000,000 which includes all prescription drug coverage;
``(ii) who has exhausted all available prescription drug
coverage under the plan as of the beginning of such period;
``(iii) who incurs (or is reasonably expected to incur) on an
annual basis during the period costs for orphan drugs in excess
of the amount specified in subparagraph (C) for the period; and
``(iv) whose annual family income (determined without regard
to this paragraph) as of the beginning of the period does not
exceed 75 percent of the amount incurred for such drugs (as
described in clause (iii)).
``(C) The amount specified in this subparagraph for a 12-month period
beginning in--
``(i) 2009 or 2010, is $200,000; or
``(ii) a subsequent year, is the amount specified in clause
(i) (or this subparagraph) for the previous year increased by
the annual rate of increase in the medical care component of
the consumer price index (U.S. city average) for the 12-month
period ending in August of the previous year.
Any amount computed under clause (ii) that is not a multiple of $1,000
shall be rounded to the nearest multiple of $1,000.
``(D) In applying this paragraph, amounts incurred for prescription
drugs for cosmetic purposes shall not be taken into account.
``(E) With respect to an individual described in subparagraph (A),
notwithstanding section 1916, the State plan--
``(i) shall provide for the application of cost-sharing that
is at least nominal as determined under section 1916; and
``(ii) may provide, consistent with section 1916A, for such
additional cost-sharing as does not exceed a maximum level of
cost-sharing that is specified by the Secretary and is adjusted
by the Secretary on an annual basis.
``(F) A State electing the option under this paragraph shall provide
for a determination on an individual's application for continued
medical assistance under this title within 30 days of the date the
application if filed with the State.
``(G) In this paragraph:
``(i) The term `orphan drugs' means prescription drugs
designated under section 526 of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 360bb) as a drug for a rare disease or
condition.
``(ii) The term `health benefits plan' includes coverage
under a plan offered under a State high risk pool.''.
Subtitle E--Financing
SEC. 1741. PAYMENTS TO PHARMACISTS.
(a) Pharmacy Reimbursement Limits.--
(1) In general.--Section 1927(e) of the Social Security Act
(42 U.S.C. 1396r-8(e)) is amended--
(A) by striking paragraph (5) and inserting the
following:
``(5) Use of amp in upper payment limits.--The Secretary
shall calculate the Federal upper reimbursement limit
established under paragraph (4) as 130 percent of the weighted
average (determined on the basis of manufacturer utilization)
of monthly average manufacturer prices.''
(2) Definition of amp.--Section 1927(k)(1)(B) of such Act (42
U.S.C. 1396r-8(k)(1)(B)) is amended--
(B) in the heading, by striking ``extended to
wholesalers'' and inserting ``and other payments''; and
(C) by striking ``regard to'' and all that follows
through the period and inserting the following:
``regard to--
``(i) customary prompt pay discounts extended
to wholesalers;
``(ii) bona fide service fees paid by
manufacturers;
``(iii) reimbursement by manufacturers for
recalled, damaged, expired, or otherwise
unsalable returned goods, including
reimbursement for the cost of the goods and any
reimbursement of costs associated with return
goods handling and processing, reverse
logistics, and drug destruction;
``(iv) sales directly to, or rebates,
discounts, or other price concessions provided
to, pharmacy benefit managers, managed care
organizations, health maintenance
organizations, insurers, mail order pharmacies
that are not open to all members of the public,
or long term care providers, provided that
these rebates, discounts, or price concessions
are not passed through to retail pharmacies;
``(v) sales directly to, or rebates,
discounts, or other price concessions provided
to, hospitals, clinics, and physicians, unless
the drug is an inhalation, infusion, or
injectable drug, or unless the Secretary
determines, as allowed for in Agency
administrative procedures, that it is necessary
to include such sales, rebates, discounts, and
price concessions in order to obtain an
accurate AMP for the drug. Such a determination
shall not be subject to judicial review; or
``(vi) rebates, discounts, and other price
concessions required to be provided under
agreements under subsections (f) and (g) of
section 1860D-2(f).''.
(3) Manufacturer reporting requirements.--Section
1927(b)(3)(A) of such Act (42 U.S.C. 1396r-8(b)(3)(A)) is
amended--
(A) in clause (ii), by striking ``and'' at the end;
(B) by striking the period at the end of clause (iii)
and inserting ``; and''; and
(C) by inserting after clause (iii) the following new
clause:
``(iv) not later than 30 days after the last
day of each month of a rebate period under the
agreement, on the manufacturer's total number
of units that are used to calculate the monthly
average manufacturer price for each covered
outpatient drug.''.
(4) Authority to promulgate regulation.--The Secretary of
Health and Human Services may promulgate regulations to clarify
the requirements for upper payment limits and for the
determination of the average manufacturer price in an expedited
manner. Such regulations may become effective on an interim
final basis, pending opportunity for public comment.
(5) Pharmacy reimbursements through december 31, 2010.--The
specific upper limit under section 447.332 of title 42, Code of
Federal Regulations (as in effect on December 31, 2006)
applicable to payments made by a State for multiple source
drugs under a State Medicaid plan shall continue to apply
through December 31, 2010, for purposes of the availability of
Federal financial participation for such payments.
(b) Disclosure of Price Information to the Public.--Section
1927(b)(3) of such Act (42 U.S.C. 1396r-8(b)(3)) is amended--
(1) in subparagraph (A)--
(A) in clause (i), in the matter preceding subclause
(I), by inserting ``month of a'' after ``each''; and
(B) in the last sentence, by striking ``and shall,''
and all that follows up to the period; and
(2) in subparagraph (D)(v), by inserting ``weighted'' before
``average manufacturer prices''.
SEC. 1742. PRESCRIPTION DRUG REBATES.
(a) Additional Rebate for New Formulations of Existing Drugs.--
(1) In general.--Section 1927(c)(2) of the Social Security
Act (42 U.S.C. 1396r-8(c)(2)) is amended by adding at the end
the following new subparagraph:
``(C) Treatment of new formulations.--In the case of
a drug that is a line extension of a single source drug
or an innovator multiple source drug that is an oral
solid dosage form, the rebate obligation with respect
to such drug under this section shall be the amount
computed under this section for such new drug or, if
greater, the product of--
``(i) the average manufacturer price of the
line extension of a single source drug or an
innovator multiple source drug that is an oral
solid dosage form;
``(ii) the highest additional rebate
(calculated as a percentage of average
manufacturer price) under this section for any
strength of the original single source drug or
innovator multiple source drug; and
``(iii) the total number of units of each
dosage form and strength of the line extension
product paid for under the State plan in the
rebate period (as reported by the State).
In this subparagraph, the term `line extension' means,
with respect to a drug, an extended release formulation
of the drug.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to drugs dispensed after December 31, 2009.
(b) Increase Minimum Rebate Percentage for Single Source Drugs.--
Section 1927(c)(1)(B)(i) of the Social Security Act (42 U.S.C. 1396r-
8(c)(1)(B)(i)) is amended--
(1) in subclause (IV), by striking ``and'' at the end;
(2) in subclause (V)--
(A) by inserting ``and before January 1, 2010'' after
``December 31, 1995,''; and
(B) by striking the period at the end and inserting
``; and''; and
(3) by adding at the end the following new subclause:
``(VI) after December 31, 2009, is
22.1 percent.''.
SEC. 1743. EXTENSION OF PRESCRIPTION DRUG DISCOUNTS TO ENROLLEES OF
MEDICAID MANAGED CARE ORGANIZATIONS.
(a) In General.--Section 1903(m)(2)(A) of the Social Security Act (42
U.S.C. 1396b(m)(2)(A)) is amended--
(1) in clause (xi), by striking ``and'' at the end;
(2) in clause (xii), by striking the period at the end and
inserting ``; and''; and
(3) by adding at the end the following:
``(xiii) such contract provides that the entity shall report
to the State such information, on such timely and periodic
basis as specified by the Secretary, as the State may require
in order to include, in the information submitted by the State
to a manufacturer under section 1927(b)(2)(A), information on
covered outpatient drugs dispensed to individuals eligible for
medical assistance who are enrolled with the entity and for
which the entity is responsible for coverage of such drugs
under this subsection.''.
(b) Conforming Amendments.--Section 1927 of such Act (42 U.S.C.
1396r-8) is amended----
(1) in the first sentence of subsection (b)(1)(A), by
inserting before the period at the end the following: ``,
including such drugs dispensed to individuals enrolled with a
medicaid managed care organization if the organization is
responsible for coverage of such drugs'';
(2) in subsection (b)(2), by adding at the end the following
new subparagraph:
``(C) Reporting on mmco drugs.--On a quarterly basis,
each State shall report to the Secretary the total
amount of rebates in dollars received from pharmacy
manufacturers for drugs provided to individuals
enrolled with Medicaid managed care organizations that
contract under section 1903(m).''; and
(3) in subsection (j)--
(A) in the heading by striking ``Exemption'' and
inserting ``Special Rules''; and
(B) in paragraph (1), by striking ``not''.
(c) Effective Date.--The amendments made by this section take effect
on July 1, 2010, and shall apply to drugs dispensed on or after such
date, without regard to whether or not final regulations to carry out
such amendments have been promulgated by such date.
SEC. 1744. PAYMENTS FOR GRADUATE MEDICAL EDUCATION.
(a) In General.--Section 1905 of the Social Security Act (42 U.S.C.
1396d), as amended by sections 1701(a)(2), 1711(a), and 1713(a), is
amended by adding at the end the following new subsection:
``(bb) Payment for Graduate Medical Education.--
``(1) In general.--The term `medical assistance' includes
payment for costs of graduate medical education consistent with
this subsection, whether provided in or outside of a hospital.
``(2) Submission of information.--For purposes of paragraph
(1) and section 1902(a)(13)(A)(v), payment for such costs is
not consistent with this subsection unless--
``(A) the State submits to the Secretary, in a timely
manner and on an annual basis specified by the
Secretary, information on total payments for graduate
medical education and how such payments are being used
for graduate medical education, including--
``(i) the institutions and programs eligible
for receiving the funding;
``(ii) the manner in which such payments are
calculated;
``(iii) the types and fields of education
being supported;
``(iv) the workforce or other goals to which
the funding is being applied;
``(v) State progress in meeting such goals;
and
``(vi) such other information as the
Secretary determines will assist in carrying
out paragraphs (3) and (4); and
``(B) such expenditures are made consistent with such
goals and requirements as are established under
paragraph (4).
``(3) Review of information.--The Secretary shall make the
information submitted under paragraph (2) available to the
Advisory Committee on Health Workforce Evaluation and
Assessment (established under section 2261 of the Public Health
Service Act). The Secretary and the Advisory Committee shall
independently review the information submitted under paragraph
(2), taking into account State and local workforce needs.
``(4) Specification of goals and requirements.--The Secretary
shall specify by rule, initially published by not later than
December 31, 2011--
``(A) program goals for the use of funds described in
paragraph (1), taking into account recommendations of
the such Advisory Committee and the goals for approved
medical residency training programs described in
section 1886(h)(1)(B); and
``(B) requirements for use of such funds consistent
with such goals.
Such rule may be effective on an interim basis pending revision
after an opportunity for public comment.''.
(b) Conforming Amendment.--Section 1902(a)(13)(A) of such Act (42
U.S.C. 1396a(a)(13)(A)), as amended by section 1721(a)(1)(A), is
amended--
(1) by striking ``and'' at the end of clause (iii);
(2) by striking the semicolon in clause (iv) and inserting
``, and''; and
(3) by adding at the end the following new clause:
``(v) in the case of hospitals and at the
option of a State, such rates may include, to
the extent consistent with section 1905(bb),
payment for graduate medical education; and''.
(c) Effective Date.--The amendments made by this section shall take
effect on the date of the enactment of this Act. Nothing in this
section shall be construed as affecting payments made before such date
under a State plan under title XIX of the Social Security Act for
graduate medical education.
SEC. 1745. REPORT ON MEDICAID PAYMENTS.
Section 1902 of the Social Security Act (42 U.S.C. 1396), as amended
by sections 1703(a), 1714(a), and 1731(a), is amended by adding at the
end the following new subsection:
``(jj) Report on Medicaid Payments.--Each year, on or before a date
determined by the Secretary, a State participating in the Medicaid
program under this title shall submit to the Administrator of the
Centers for Medicare & Medicaid Services--
``(1) information on the determination of rates of payment to
providers for covered services under the State plan,
including--
``(A) the final rates;
``(B) the methodologies used to determine such rates;
and
``(C) justifications for the rates; and
``(2) an explanation of the process used by the State to
allow providers, beneficiaries and their representatives, and
other concerned State residents a reasonable opportunity to
review and comment on such rates, methodologies, and
justifications before the State made such rates final.''.
SEC. 1746. REVIEWS OF MEDICAID.
(a) GAO Study on FMAP.--.
(1) Study.--The Comptroller General of the United States
shall conduct a study regarding federal payments made to the
State Medicaid programs under title XIX of the Social Security
Act for the purposes of making recommendations to Congress.
(2) Report.--Not later than February 15, 2011, the
Comptroller General shall submit to the appropriate committees
of Congress a report on the study conducted under paragraph (1)
and the effect on the federal government, States, providers,
and beneficiaries of--
(A) removing the 50 percent floor, or 83 percent
ceiling, or both, in the Federal medical assistance
percentage under section 1905(b)(1) of the Social
Security Act; and
(B) revising the current formula for such Federal
medical assistance percentage to better reflect State
fiscal capacity and State effort to pay for health and
long-term care services and to better adjust for
national or regional economic downturns.
(b) GAO Study on Medicaid Administrative Costs..--
(1) Study.--The Comptroller General of the United States
shall conduct a study of the administration of the Medicaid
program by the Department of Health and Human Services, State
Medicaid agencies, and local government agencies. The report
shall address the following issues:
(A) The extent to which federal funds for each
administrative function, such as survey and
certification and claims processing, are being used
effectively and efficiently.
(B) The administrative functions on which federal
Medicaid funds are expended and the amounts of such
expenditures (whether spent directly or by contract).
(2) Report.--Not later than February 15, 2011, the
Comptroller General shall submit to the appropriate committees
of Congress a report on the study conducted under paragraph
(1).
SEC. 1747. EXTENSION OF DELAY IN MANAGED CARE ORGANIZATION PROVIDER TAX
ELIMINATION.
Effective as if included in the enactment of section 6051 of the
Deficit Reduction Act of 2005 (Public Law 109-171), subsection
(b)(2)(A) of such section is amended by striking ``October 1, 2009''
and inserting ``October 1, 2010''.
Subtitle F--Waste, Fraud, and Abuse
SEC. 1751. HEALTH CARE ACQUIRED CONDITIONS.
(a) Medicaid Non-payment for Certain Health Care-acquired
Conditions.--Section 1903(i) of the Social Security Act (42 U.S.C.
1396b(i)) is amended--
(1) by striking ``or'' at the end of paragraph (23);
(2) by striking the period at the end of paragraph (24) and
inserting ``; or''; and
(3) by inserting after paragraph (24) the following new
paragraph:
``(25) with respect to amounts expended for services related
to the presence of a condition that could be identified by a
secondary diagnostic code described in section
1886(d)(4)(D)(iv) and for any health care acquired condition
determined as a non-covered service under title XVIII.''.
(b) Application to CHIP.--Section 2107(e)(1)(G) of such Act (42
U.S.C. 1397gg(e)(1)(G)) is amended by striking ``and (17)'' and
inserting ``(17), and (25)''.
(c) Permission to Include Additional Health Care-acquired
Conditions.--Nothing in this section shall prevent a State from
including additional health care-acquired conditions for non-payment in
its Medicaid program under title XIX of the Social Security Act.
(d) Effective Date.--The amendments made by this section shall apply
to discharges occurring on or after January 1, 2010.
SEC. 1752. EVALUATIONS AND REPORTS REQUIRED UNDER MEDICAID INTEGRITY
PROGRAM.
Section 1936(c)(2)) of the Social Security Act (42 U.S.C. 1396u-
7(c)(2)) is amended--
(1) by redesignating subparagraph (D) as subparagraph (E);
and
(2) by inserting after subparagraph (C) the following new
subparagraph:
``(D) For the contract year beginning in 2011 and
each subsequent contract year, the entity provides
assurances to the satisfaction of the Secretary that
the entity will conduct periodic evaluations of the
effectiveness of the activities carried out by such
entity under the Program and will submit to the
Secretary an annual report on such activities.''.
SEC. 1753. REQUIRE PROVIDERS AND SUPPLIERS TO ADOPT PROGRAMS TO REDUCE
WASTE, FRAUD, AND ABUSE.
Section 1902(a) of such Act (42 U.S.C. 42 U.S.C. 1396a(a)), as
amended by sections 1631(b)(1), 1703, and 1729, is further amended--
(1) in paragraph (75), by striking at the end ``and'';
(2) in paragraph (76), by striking at the end the period and
inserting ``; and''; and
(3) by inserting after paragraph (76) the following new
paragraph:
``(77) provide that any provider or supplier (other than a
physician or nursing facility) providing services under such
plan shall, subject to paragraph (5) of section 1874(d),
establish a compliance program described in paragraph (1) of
such section in accordance with such section.''.
SEC. 1754. OVERPAYMENTS.
(a) In General.--Section 1903(d)(2)(C) of the Social Security Act (42
U.S.C. 1396b(d)(2)(C)) is amended--
(1) in the first sentence, by inserting ``(or of 1 year in
the case of overpayments due to fraud)'' after ``60 days''; and
(2) in the second sentence, by striking ``the 60 days'' and
inserting ``such period''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply in the case of overpayments discovered on or after the date of
the enactment of this Act.
SEC. 1755. MANAGED CARE ORGANIZATIONS.
(a) Minimum Medical Loss Ratio.--
(1) Medicaid.--Section 1903(m)(2)(A) of the Social Security
Act (42 U.S.C. 1396b(m)(2)(A)), as amended by section
1743(a)(3), is amended--
(A) by striking ``and'' at the end of clause (xii);
(B) by striking the period at the end of clause
(xiii) and inserting ``; and''; and
(C) by adding at the end the following new clause:
``(xiv) such contract has a medical loss ratio, as determined
in accordance with a methodology specified by the Secretary
that is a percentage (not less than 85 percent) as specified by
the Secretary.''.
(2) CHIP.--Section 2107(e)(1) of such Act (42 U.S.C.
1397gg(e)(1)) is amended--
(A) by redesignating subparagraphs (H) through (L) as
subparagraphs (I) through (M); and
(B) by inserting after subparagraph (G) the following
new subparagraph:
``(H) Section 1903(m)(2)(A)(xiv) (relating to
application of minimum loss ratios), with respect to
comparable contracts under this title.''.
(3) Effective date.--The amendments made by this subsection
shall apply to contracts entered into or renewed on or after
July 1, 2010.
(b) Patient Encounter Data.--
(1) In general.--Section 1903(m)(2)(A)(xi) of the Social
Security Act (42 U.S.C. 1396b(m)(2)(A)(xi)) is amended by
inserting ``and for the provision of such data to the State at
a frequency and level of detail to be specified by the
Secretary'' after ``patients''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply with respect to contract years beginning on or
after January 1, 2010.
SEC. 1756. TERMINATION OF PROVIDER PARTICIPATION UNDER MEDICAID AND
CHIP IF TERMINATED UNDER MEDICARE OR OTHER STATE
PLAN OR CHILD HEALTH PLAN.
(a) State Plan Requirement.--Section 1902(a)(39) of the Social
Security Act (42 U.S.C. 42 U.S.C. 1396a(a)) is amended by inserting
after ``1128A,'' the following: ``terminate the participation of any
individual or entity in such program if (subject to such exceptions are
are permitted with respect to exclusion under sections 1128(b)(3)(C)
and 1128(d)(3)(B)) participation of such individual or entity is
terminated under title XVIII, any other State plan under this title, or
any child health plan under title XXI,''.
(b) Application to CHIP.--Section 2107(e)(1)(A) of such Act (42
U.S.C. 1397gg(e)(1)(A)) is amended by inserting before the period at
the end the following: ``and section 1902(a)(39) (relating to exclusion
and termination of participation)''.
(c) Effective Date.--
(1) Except as provided in paragraph (2), the amendments made
by this section shall apply to services furnished on or after
January 1, 2011, without regard to whether or not final
regulations to carry out such amendments have been promulgated
by such date.
(2) In the case of a State plan for medical assistance under
title XIX of the Social Security Act or a child health plan
under title XXI of such Act which the Secretary of Health and
Human Services determines requires State legislation (other
than legislation appropriating funds) in order for the plan to
meet the additional requirement imposed by the amendments made
by this section, the State plan or child health plan shall not
be regarded as failing to comply with the requirements of such
title solely on the basis of its failure to meet this
additional requirement before the first day of the first
calendar quarter beginning after the close of the first regular
session of the State legislature that begins after the date of
the enactment of this Act. For purposes of the previous
sentence, in the case of a State that has a 2-year legislative
session, each year of such session shall be deemed to be a
separate regular session of the State legislature.
SEC. 1757. MEDICAID AND CHIP EXCLUSION FROM PARTICIPATION RELATING TO
CERTAIN OWNERSHIP, CONTROL, AND MANAGEMENT
AFFILIATIONS.
(a) State Plan Requirement.--Section 1902(a) of the Social Security
Act (42 U.S.C. 1396a(a)), as amended by sections 1631(b)(1), 1703(a),
1729, and 1753, is further amended--
(1) in paragraph (76), by striking at the end ``and'';
(2) in paragraph (77), by striking at the end the period and
inserting ``; and''; and
(3) by inserting after paragraph (77) the following new
paragraph:
``(78) provide that the State agency described in paragraph
(9) exclude, with respect to a period, any individual or entity
from participation in the program under the State plan if such
individual or entity owns, controls, or manages an entity that
(or if such entity is owned, controlled, or managed by an
individual or entity that)--
``(A) has unpaid overpayments under this title during
such period determined by the Secretary or the State
agency to be delinquent;
``(B) is suspended or excluded from participation
under or whose participation is terminated under this
title during such period; or
``(C) is affiliated with an individual or entity that
has been suspended or excluded from participation under
this title or whose participation is terminated under
this title during such period.''.
(b) Child Health Plan Requirement.--Section 2107(e)(1)(A) of such Act
(42 U.S.C. 1397gg(e)(1)(A)), as amended by section 1756(b), is amended
by striking ``section 1902(a)(39)'' and inserting ``sections
1902(a)(39) and 1902(a)(78)''.
(c) Effective Date.--
(1) Except as provided in paragraph (2), the amendments made
by this section shall apply to services furnished on or after
January 1, 2011, without regard to whether or not final
regulations to carry out such amendments have been promulgated
by such date.
(2) In the case of a State plan for medical assistance under
title XIX of the Social Security Act or a child health plan
under title XXI of such Act which the Secretary of Health and
Human Services determines requires State legislation (other
than legislation appropriating funds) in order for the plan to
meet the additional requirement imposed by the amendments made
by this section, the State plan or child health plan shall not
be regarded as failing to comply with the requirements of such
title solely on the basis of its failure to meet this
additional requirement before the first day of the first
calendar quarter beginning after the close of the first regular
session of the State legislature that begins after the date of
the enactment of this Act. For purposes of the previous
sentence, in the case of a State that has a 2-year legislative
session, each year of such session shall be deemed to be a
separate regular session of the State legislature.
SEC. 1758. REQUIREMENT TO REPORT EXPANDED SET OF DATA ELEMENTS UNDER
MMIS TO DETECT FRAUD AND ABUSE.
Section 1903(r)(1)(F) of the Social Security Act (42 U.S.C.
1396b(r)(1)(F)) is amended by inserting after ``necessary'' the
following: ``and including, for data submitted to the Secretary on or
after July 1, 2010, data elements from the automated data system that
the Secretary determines to be necessary for detection of waste, fraud,
and abuse''.
SEC. 1759. BILLING AGENTS, CLEARINGHOUSES, OR OTHER ALTERNATE PAYEES
REQUIRED TO REGISTER UNDER MEDICAID.
(a) In General.--Section 1902(a) of the Social Security Act (42
U.S.C. 42 U.S.C. 1396a(a)), as amended by sections 1631(b), 1703(a),
1729, 1753, and 1757(a), is further amended--
(1) in paragraph (77); by striking at the end ``and'';
(2) in paragraph (78), by striking the period at the end and
inserting ``and''; and
(3) by inserting after paragraph (78) the following new
paragraph:
``(79) provide that any agent, clearinghouse, or other
alternate payee that submits claims on behalf of a health care
provider must register with the State and the Secretary in a
form and manner specified by the Secretary under section
1866(j)(1)(D).''.
(b) Denial of Payment.--Section 1903(i) of such Act (42 U.S.C.
1396b(i)), as amended by section 1751, is amended--
(1) by striking ``or'' at the end of paragraph (24);
(2) by striking the period at the end of paragraph (25) and
inserting ``; or''; and
(3) by inserting after paragraph (25) the following new
paragraph:
``(26) with respect to any amount paid to a billing agent,
clearinghouse, or other alternate payee that is not registered
with the State and the Secretary as required under section
1902(a)(79).''.
(c) Effective Date.--
(1) Except as provided in paragraph (2), the amendments made
by this section shall apply to claims submitted on or after
January 1, 2012, without regard to whether or not final
regulations to carry out such amendments have been promulgated
by such date.
(2) In the case of a State plan for medical assistance under
title XIX of the Social Security Act which the Secretary of
Health and Human Services determines requires State legislation
(other than legislation appropriating funds) in order for the
plan to meet the additional requirement imposed by the
amendments made by this section, the State plan or child health
plan shall not be regarded as failing to comply with the
requirements of such title solely on the basis of its failure
to meet this additional requirement before the first day of the
first calendar quarter beginning after the close of the first
regular session of the State legislature that begins after the
date of the enactment of this Act. For purposes of the previous
sentence, in the case of a State that has a 2-year legislative
session, each year of such session shall be deemed to be a
separate regular session of the State legislature.
SEC. 1760. DENIAL OF PAYMENTS FOR LITIGATION-RELATED MISCONDUCT.
(a) In General.--Section 1903(i) of the Social Security Act (42
U.S.C. 1396b(i)), as amended by sections 1751(a) and 1759(b), is
amended--
(1) by striking ``or'' at the end of paragraph (25);
(2) by striking the period at the end of paragraph (26) and
inserting ``; or''; and
(3) by inserting after paragraph (26) the following new
paragraph:
``(27) with respect to any amount expended--
``(A) on litigation in which a court imposes
sanctions on the State, its employees, or its counsel
for litigation-related misconduct; or
``(B) to reimburse (or otherwise compensate) a
managed care entity for payment of legal expenses
associated with any action in which a court imposes
sanctions on the managed care entity for litigation-
related misconduct.''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to amounts expended on or after January 1, 2010.
SEC. 1761. MANDATORY STATE USE OF NATIONAL CORRECT CODING INITIATIVE.
(a) In General.--Section 1903(r) of the Social Security Act (42
U.S.C. 1396b(r)) is amended--
(1) in paragraph (1)(B)--
(A) in clause (ii), by striking ``and'' at the end;
(B) in clause (iii), by adding ``and'' after the
semicolon; and
(C) by adding at the end the following new clause:
``(iv) effective for claims filed on or after
October 1, 2010, incorporate compatible
methodologies of the National Correct Coding
Initiative administered by the Secretary (or
any successor initiative to promote correct
coding and to control improper coding leading
to inappropriate payment) and such other
methodologies of that Initiative (or such other
national correct coding methodologies) as the
Secretary identifies in accordance with
paragraph (3);''; and
(2) by adding at the end the following new paragraph:
``(3) Not later than September 1, 2010, the Secretary shall do the
following:
``(A) Identify those methodologies of the National Correct
Coding Initiative administered by the Secretary (or any
successor initiative to promote correct coding and to control
improper coding leading to inappropriate payment) which are
compatible to claims filed under this title.
``(B) Identify those methodologies of such Initiative (or
such other national correct coding methodologies) that should
be incorporated into claims filed under this title with respect
to items or services for which States provide medical
assistance under this title and no national correct coding
methodologies have been established under such Initiative with
respect to title XVIII.
``(C) Notify States of--
``(i) the methodologies identified under
subparagraphs (A) and (B) (and of any other national
correct coding methodologies identified under
subparagraph (B)); and
``(ii) how States are to incorporate such
methodologies into claims filed under this title.
``(D) Submit a report to Congress that includes the notice to
States under subparagraph (C) and an analysis supporting the
identification of the methodologies made under subparagraphs
(A) and (B).''.
(b) Extension for State Law Amendment.--In the case of a State plan
under title XIX of the Social Security Act (42 U.S.C. 1396 et seq.)
which the Secretary of Health and Human Services determines requires
State legislation in order for the plan to meet the additional
requirements imposed by the amendment made by subsection (a)(1)(C), the
State plan shall not be regarded as failing to comply with the
requirements of such title solely on the basis of its failure to meet
these additional requirements before the first day of the first
calendar quarter beginning after the close of the first regular session
of the State legislature that begins after the date of enactment of
this Act. For purposes of the previous sentence, in the case of a State
that has a 2-year legislative session, each year of the session is
considered to be a separate regular session of the State legislature.
Subtitle G--Payments to the Territories
SEC. 1771. PAYMENT TO TERRITORIES.
(a) Increase in Cap.--Section 1108 of the Social Security Act (42
U.S.C. 1308) is amended--
(1) in subsection (f), by striking ``subsection (g)'' and
inserting ``subsections (g) and (h)'';
(2) in subsection (g)(1), by striking ``With respect to'' and
inserting ``Subject to subsection (h), with respect to''; and
(3) by adding at the end the following new subsection:
``(h) Additional Increase for Fiscal Years 2011 Through 2019.--With
respect to fiscal years 2011 through 2019, the amounts otherwise
determined under subsections (f) and (g) for Puerto Rico, the Virgin
Islands, Guam, the Northern Mariana Islands and American Samoa shall be
increased by the following amounts:
``(1) For Puerto Rico, for fiscal year 2011, $727,600,000;
for fiscal year 2012, $775,000,000; for fiscal year 2013,
$850,000,000; for fiscal year 2014, $925,000,000; for fiscal
year 2015, $1,000,000,000; for fiscal year 2016,
$1,075,000,000; for fiscal year 2017, $1,150,000,000; for
fiscal year 2018, $1,225,000,000; and for fiscal year 2019,
$1,396,400,000.
``(2) For the Virgin Islands, for fiscal year 2011,
$34,000,000; for fiscal year 2012, $37,000,000; for fiscal year
2013, $40,000,000; for fiscal year 2014, $43,000,000; for
fiscal year 2015, $46,000,000; for fiscal year 2016,
$49,000,000; for fiscal year 2017, $52,000,000; for fiscal year
2018, $55,000,000; and for fiscal year 2019, $58,000,000.
``(3) For Guam, for fiscal year 2011, $34,000,000; for fiscal
year 2012, $37,000,000; for fiscal year 2013, $40,000,000; for
fiscal year 2014, $43,000,000; for fiscal year 2015,
$46,000,000; for fiscal year 2016, $49,000,000; for fiscal year
2017, $52,000,000; for fiscal year 2018, $55,000,000; and for
fiscal year 2019, $58,000,000.
``(4) For the Northern Mariana Islands, for fiscal year 2011,
$13,500,000; fiscal year 2012, $14,500,000; for fiscal year
2013, $15,500,000; for fiscal year 2014, $16,500,000; for
fiscal year 2015, $17,500,000; for fiscal year 2016,
$18,500,000; for fiscal year 2017, $19,500,000; for fiscal year
2018, $21,000,000; and for fiscal year 2019, $22,000,000.
``(5) For American Samoa, fiscal year 2011, $22,000,000;
fiscal year 2012, $23,687,500; for fiscal year 2013,
$24,687,500; for fiscal year 2014, $25,687,500; for fiscal year
2015, $26,687,500; for fiscal year 2016, $27,687,500; for
fiscal year 2017, $28,687,500; for fiscal year 2018,
$29,687,500; and for fiscal year 2019, $30,687,500.''.
(b) Report on Achieving Medicaid Parity Payments Beginning With
Fiscal Year 2020.--
(1) In general.--Not later than October 1, 2013, the
Secretary of Health and Human Services shall submit to Congress
a report that details a plan for the transition of each
territory to full parity in Medicaid with the 50 States and the
District of Columbia in fiscal year 2020 by modifying their
existing Medicaid programs and outlining actions the Secretary
and the governments of each territory must take by fiscal year
2020 to ensure parity in financing. Such report shall include
what the Federal medical assistance percentages would be for
each territory if the formula applicable to the 50 States were
applied. Such report shall also include any recommendations
that the Secretary may have as to whether the mandatory ceiling
amounts for each territory provided for in section 1108 of the
Social Security Act (42 U.S.C. 1308) should be increased any
time before fiscal year 2020 due to any factors that the
Secretary deems relevant.
(2) Per capita data.--As part of such report the Secretary
shall include information about per capita income data that
could be used to calculate Federal medical assistance
percentages under section 1905(b) of the Social Security Act,
under section 1108(a)(8)(B) of such Act, for each territory on
how such data differ from the per capita income data used to
promulgate Federal medical assistance percentages for the 50
States. The report under this subsection shall include
recommendations on how the Federal medical assistance
percentages can be calculated for the territories beginning in
fiscal year 2020 to ensure parity with the 50 States.
(3) Subsequent reports.--The Secretary shall submit
subsequent reports to Congress in 2015, 2017, and 2019
detailing the progress that the Secretary and the governments
of each territory have made in fulfilling the actions outlined
in the plan submitted under paragraph (1).
(c) Application of FMAP for Additional Funds.--Section 1905(b) of
such Act (42 U.S.C. 1396d(b)) is amended by adding at the end the
following sentence: ``Notwithstanding the first sentence of this
subsection and any other provision of law, for fiscal years 2011
through 2019, the Federal medical assistance percentage for Puerto
Rico, the Virgin Islands, Guam, the Northern Mariana Islands, and
American Samoa shall be the highest Federal medical assistance
percentage applicable to any of the 50 States or the District of
Columbia for the fiscal year involved, taking into account the
application of subsections (a) and (b)(1) of section 5001 of division B
of the American Recovery and Reinvestment Act of 2009 (Public Law 111-
5) to such States and the District for calendar quarters during such
fiscal years for which such subsections apply.''.
(d) Waivers.--
(1) In general.--Section 1902(j) of the Social Security Act
(42 U.S.C. 1396a(j)) is amended--
(A) by striking ``American Samoa and the Northern
Mariana Islands'' and inserting ``Puerto Rico, the
Virgin Islands, Guam, the Northern Mariana Islands, and
American Samoa''; and
(B) by striking ``American Samoa or the Northern
Mariana Islands'' and inserting ``Puerto Rico, the
Virgin Islands, Guam, the Northern Mariana Islands, or
American Samoa''.
(2) Effective date.--The amendments made by paragraph (1)
shall apply beginning with fiscal year 2011.
(e) Technical Assistance.--The Secretary shall provide technical
assistance to the governments of Puerto Rico, the Virgin Islands, Guam,
the Northern Mariana Islands, and American Samoa in upgrading their
existing computer systems in order to anticipate meeting reporting
requirements necessary to implement the plan contained in the report
under subsection (b)(1). The provision of such technical assistance
shall not be counted against any limitation on payment to the
territories under section 1108 of the Social Security Act.
Subtitle H--Miscellaneous
SEC. 1781. TECHNICAL CORRECTIONS.
(a) Technical Correction to Section 1144 of the Social Security
Act.--The first sentence of section 1144(c)(3) of the Social Security
Act (42 U.S.C. 1320b--14(c)(3)) is amended--
(1) by striking ``transmittal''; and
(2) by inserting before the period the following: ``as
specified in section 1935(a)(4)''.
(b) Clarifying Amendment to Section 1935 of the Social Security
Act.--Section 1935(a)(4) of the Social Security Act (42 U.S.C. 1396u--
5(a)(4)), as amended by section 113(b) of Public Law 110-275, is
amended--
(1) by striking the second sentence;
(2) by redesignating the first sentence as a subparagraph (A)
with appropriate indentation and with the following heading:
``In general.--'';
(3) by adding at the end the following subparagraphs:
``(B) Furnishing medical assistance with reasonable
promptness.--For the purpose of a State's obligation
under section 1902(a)(8) to furnish medical assistance
with reasonable promptness, the date of the electronic
transmission of low-income subsidy program data, as
described in section 1144(c), from the Commissioner of
Social Security to the State Medicaid Agency, shall
constitute the date of filing of such application for
benefits under the Medicare Savings Program.
``(C) Determining availability of medical
assistance.--For the purpose of determining when
medical assistance will be made available, the State
shall consider the date of the individual's application
for the low income subsidy program to constitute the
date of filing for benefits under the Medicare Savings
Program.''.
(c) Effective Date Relating to Medicaid Agency Consideration of Low-
income Subsidy Application and Data Transmittal.--The amendments made
by subsections (a) and (b) shall be effective as if included in the
enactment of section 113(b) of Public Law 110-275.
(d) Technical Correction to Section 605 of CHIPRA.--Section 605 of
the Children's Health Insurance Program Reauthorization Act of 2009
(Public Law 111-3) is amended by striking ``legal residents'' and
inserting ``lawfully residing in the United States''.
(e) Technical Correction to Section 1905 of the Social Security
Act.--Section 1905(a) of the Social Security Act (42 U.S.C. 1396d(a))
is amended by inserting ``or the care and services themselves, or
both'' before ``(if provided in or after''.
(f) Clarifying Amendment to Section 1115 of the Social Security
Act.--Section 1115(a) of the Social Security Act (42 U.S.C. 1315(a)) is
amended by adding at the end the following: ``If an experimental,
pilot, or demonstration project that relates to title XIX is approved
pursuant to any part of this subsection, such project shall be treated
as part of the State plan, all medical assistance provided on behalf of
any individuals affected by such project shall be medical assistance
provided under the State plan, and all provisions of this Act not
explicitly waived in approving such project shall remain fully
applicable to all individuals receiving benefits under the State
plan.''.
SEC. 1782. EXTENSION OF QI PROGRAM.
(a) In General.--Section 1902(a)(10)(E)(iv) of the Social Security
Act (42 U.S.C. 1396b(a)(10)(E)(iv)) is amended--
(1) by striking ``sections 1933 and'' and by inserting
``section''; and
(2) by striking ``December 2010'' and inserting ``December
2012''.
(b) Elimination of Funding Limitation.--
(1) In general.--Section 1933 of such Act (42 U.S.C. 1396u-3)
is amended--
(A) in subsection (a), by striking ``who are selected
to receive such assistance under subsection (b)'';
(B) by striking subsections (b), (c), (e), and (g);
(C) in subsection (d), by striking ``furnished in a
State'' and all that follows and inserting ``the
Federal medical assistance percentage shall be equal to
100 percent.''; and
(D) by redesignating subsections (d) and (f) as
subsections (b) and (c), respectively.
(2) Conforming amendment.--Section 1905(b) of such Act (42
U.S.C. 1396d(b)) is amended by striking ``1933(d)'' and
inserting ``1933(b)''.
(3) Effective date.--The amendments made by paragraph (1)
shall take effect on January 1, 2011.
SEC. 1783. OUTREACH AND ENROLLMENT OF MEDICAID AND CHIP ELIGIBLE
INDIVIDUALS.
(a) In General.--Not later than 12 months after date of enactment of
this Act, the Secretary of Health and Human Services shall issue
guidance regarding standards and best practices for conducting outreach
to inform eligible individuals about healthcare coverage under Medicaid
under title XIX of the Social Security Act or for child health
assistance under CHIP under title XXI of such Act, providing assistance
to such individuals for enrollment in applicable programs, and
establishing methods or procedures for eliminating application and
enrollment barriers. Such guidance shall include provisions to ensure
that outreach, enrollment assistance, and administrative simplification
efforts are targeted specifically to vulnerable populations such as
children, unaccompanied homeless youth, victims of abuse or trauma,
individuals with mental health or substance related disorders, and
individuals with HIV/AIDS. Guidance issued pursuant to this section
relating to methods to increase outreach and enrollment provided for
under titles XIX and XXI of the Social Security Act shall specifically
target such vulnerable and underserved populations and shall include,
but not be limited to, guidance on outstationing of eligibility
workers, express lane eligibility, residence requirements,
documentation of income and assets, presumptive eligibility, continuous
eligibility, and automatic renewal.
(b) Implementation.--In implementing the requirements under
subsection (a), the Secretary may use such authorities as are available
under law and may work with such entities as the Secretary deems
appropriate to facilitate effective implementation of such programs.
Not later than 2 years after the enactment of this Act and annually
thereafter, the Secretary shall review and report to Congress on
progress in implementing targeted outreach, application and enrollment
assistance, and administrative simplification methods for such
vulnerable and underserved populations as are specified in subsection
(a).
SEC. 1784. PROHIBITIONS ON FEDERAL MEDICAID AND CHIP PAYMENT FOR
UNDOCUMENTED ALIENS.
Nothing in this title shall change current prohibitions against
Federal Medicaid and CHIP payments under titles XIX and XXI of the
Social Security Act on behalf of individuals who are not lawfully
present in the United States.
SEC. 1785. DEMONSTRATION PROJECT FOR STABILIZATION OF EMERGENCY MEDICAL
CONDITIONS BY NONPUBLICLY OWNED OR OPERATED
INSTITUTIONS FOR MENTAL DISEASES.
(a) Authority To Conduct Demonstration Project.--The Secretary of
Health and Human Services (in this section referred to as the
``Secretary'') shall establish a demonstration project under which an
eligible State (as described in subsection (c)) shall provide
reimbursement under the State Medicaid plan under title XIX of the
Social Security Act to an institution for mental diseases that is not
publicly owned or operated and that is subject to the requirements of
section 1867 of the Social Security Act (42 U.S.C. 1395dd) for the
provision of medical assistance available under such plan to an
individual who--
(1) has attained age 21, but has not attained age 65;
(2) is eligible for medical assistance under such plan; and
(3) requires such medical assistance to stabilize an
emergency medical condition.
(b) In-stay Review.--The Secretary shall establish a mechanism for
in-stay review to determine whether or not the patient has been
stabilized (as defined in subsection (h)(5)). This mechanism shall
commence before the third day of the inpatient stay. States
participating in the demonstration project may manage the provision of
these benefits under the project through utilization review,
authorization, or management practices, or the application of medical
necessity and appropriateness criteria applicable to behavioral health.
(c) Eligible State Defined.--
(1) Application.--Upon approval of an application submitted
by a State described in paragraph (2), the State shall be an
eligible State for purposes of conducting a demonstration
project under this section.
(2) State described.--States shall be selected by the
Secretary in a manner so as to provide geographic diversity on
the basis of the application to conduct a demonstration project
under this section submitted by such States.
(d) Length of Demonstration Project.--The demonstration project
established under this section shall be conducted for a period of 3
consecutive years.
(e) Limitations on Federal Funding.--
(1) Appropriation.--
(A) In general.--Out of any funds in the Treasury not
otherwise appropriated, there is appropriated to carry
out this section, $75,000,000 for fiscal year 2010.
(B) Budget authority.--Subparagraph (A) constitutes
budget authority in advance of appropriations Act and
represents the obligation of the Federal Government to
provide for the payment of the amounts appropriated
under that subparagraph.
(2) 3-year availability.--Funds appropriated under paragraph
(1) shall remain available for obligation through December 31,
2012.
(3) Limitation on payments.--In no case may--
(A) the aggregate amount of payments made by the
Secretary to eligible States under this section exceed
$75,000,000; or
(B) payments be provided by the Secretary under this
section after December 31, 2012.
(4) Funds allocated to states.--The Secretary shall allocate
funds to eligible States based on their applications and the
availability of funds.
(5) Payments to states.--The Secretary shall pay to each
eligible State, from its allocation under paragraph (4), an
amount each quarter equal to the Federal medical assistance
percentage of expenditures in the quarter for medical
assistance described in subsection (a).
(f) Reports.--
(1) Annual progress reports.--The Secretary shall submit
annual reports to Congress on the progress of the demonstration
project conducted under this section.
(2) Final report and recommendation.--An evaluation shall be
conducted of the demonstration project's impact on the
functioning of the health and mental health service system and
on individuals enrolled in the Medicaid program. This
evaluation shall include collection of baseline data for one-
year prior to the initiation of the demonstration project as
well as collection of data from matched comparison states not
participating in the demonstration. The evaluation measures
shall include the following:
(A) A determination, by State, as to whether the
demonstration project resulted in increased access to
inpatient mental health services under the Medicaid
program and whether average length of stays were longer
(or shorter) for individuals admitted under the
demonstration project compared with individuals
otherwise admitted in comparison sites.
(B) An analysis, by State, regarding whether the
demonstration project produced a significant reduction
in emergency room visits for individuals eligible for
assistance under the Medicaid program or in the
duration of emergency room lengths of stay.
(C) An assessment of discharge planning by
participating hospitals that ensures access to further
(non-emergency) inpatient or residential care as well
as continuity of care for those discharged to
outpatient care.
(D) An assessment of the impact of the demonstration
project on the costs of the full range of mental health
services (including inpatient, emergency and ambulatory
care) under the plan as contrasted with the comparison
areas.
(E) Data on the percentage of consumers with Medicaid
coverage who are admitted to inpatient facilities as a
result of the demonstration project as compared to
those admitted to these same facilities through other
means.
(F) A recommendation regarding whether the
demonstration project should be continued after
December 31, 2012, and expanded on a national basis.
(g) Waiver Authority.--
(1) In general.--The Secretary shall waive the limitation of
subdivision (B) following paragraph (28) of section 1905(a) of
the Social Security Act (42 U.S.C. 1396d(a)) (relating to
limitations on payments for care or services for individuals
under 65 years of age who are patients in an institution for
mental diseases) for purposes of carrying out the demonstration
project under this section.
(2) Limited other waiver authority.--The Secretary may waive
other requirements of titles XI and XIX of the Social Security
Act (including the requirements of sections 1902(a)(1)
(relating to statewideness) and 1902(1)(10)(B) (relating to
comparability)) only to extent necessary to carry out the
demonstration project under this section.
(h) Definitions.--In this section:
(1) Emergency medical condition.--The term ``emergency
medical condition'' means, with respect to an individual, an
individual who expresses suicidal or homicidal thoughts or
gestures, if determined dangerous to self or others.
(2) Federal medical assistance percentage.--The term
``Federal medical assistance percentage'' has the meaning given
that term with respect to a State under section 1905(b) of the
Social Security Act (42 U.S.C. 1396d(b)).
(3) Institution for mental diseases.--The term ``institution
for mental diseases'' has the meaning given to that term in
section 1905(i) of the Social Security Act (42 U.S.C.
1396d(i)).
(4) Medical assistance.--The term ``medical assistance'' has
the meaning given to that term in section 1905(a) of the Social
Security Act (42 U.S.C. 1396d(a)).
(5) Stabilized.--The term ``stabilized'' means, with respect
to an individual, that the emergency medical condition no
longer exists with respect to the individual and the individual
is no longer dangerous to self or others.
(6) State.--The term ``State'' has the meaning given that
term for purposes of title XIX of the Social Security Act (42
U.S.C. 1396 et seq.).
[TITLE VIII--REVENUE-RELATED PROVISIONS]
[For title VIII, see text of bill as introduced on July 14, 2009.]
TITLE IX--MISCELLANEOUS PROVISIONS
SEC. 1901. REPEAL OF TRIGGER PROVISION.
Subtitle A of title VIII of the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003 (Public Law 108-173) is
repealed and the provisions of law amended by such subtitle are
restored as if such subtitle had never been enacted.
SEC. 1902. REPEAL OF COMPARATIVE COST ADJUSTMENT (CCA) PROGRAM.
Section 1860C-1 of the Social Security Act (42 U.S.C. 1395w-29), as
added by section 241(a) of the Medicare Prescription Drug, Improvement,
and Modernization Act of 2003 (Public Law 108-173), is repealed.
SEC. 1903. EXTENSION OF GAINSHARING DEMONSTRATION.
(a) In General.--Subsection (d)(3) of section 5007 of the Deficit
Reduction Act of 2005 (Public Law 109-171) is amended by inserting
``(or September 30, 2011, in the case of a demonstration project in
operation as of October 1, 2008)'' after ``December 31, 2009''.
(b) Funding.--
(1) In general.--Subsection (f)(1) of such section is amended
by inserting ``and for fiscal year 2010, $1,600,000,'' after
``$6,000,000,''.
(2) Availability.--Subsection (f)(2) of such section is
amended by striking ``2010'' and inserting ``2014 or until
expended''.
(c) Reports.--
(1) Quality improvement and savings.--Subsection (e)(3) of
such section is amended by striking ``December 1, 2008'' and
inserting ``March 31, 2011''.
(2) Final report.--Subsection (e)(4) of such section is
amended by striking ``May 1, 2010'' and inserting ``March 31,
2013''.
SEC. 1904. GRANTS TO STATES FOR QUALITY HOME VISITATION PROGRAMS FOR
FAMILIES WITH YOUNG CHILDREN AND FAMILIES EXPECTING
CHILDREN.
Part B of title IV of the Social Security Act (42 U.S.C. 621-629i) is
amended by adding at the end the following:
``Subpart 3--Support for Quality Home Visitation Programs
``SEC. 440. HOME VISITATION PROGRAMS FOR FAMILIES WITH YOUNG CHILDREN
AND FAMILIES EXPECTING CHILDREN.
``(a) Purpose.--The purpose of this section is to improve the well-
being, health, and development of children by enabling the
establishment and expansion of high quality programs providing
voluntary home visitation for families with young children and families
expecting children.
``(b) Grant Application.--A State that desires to receive a grant
under this section shall submit to the Secretary for approval, at such
time and in such manner as the Secretary may require, an application
for the grant that includes the following:
``(1) Description of home visitation programs.--A description
of the high quality programs of home visitation for families
with young children and families expecting children that will
be supported by a grant made to the State under this section,
the outcomes the programs are intended to achieve, and the
evidence supporting the effectiveness of the programs.
``(2) Results of needs assessment.--The results of a
statewide needs assessment that describes--
``(A) the number, quality, and capacity of home
visitation programs for families with young children
and families expecting children in the State;
``(B) the number and types of families who are
receiving services under the programs;
``(C) the sources and amount of funding provided to
the programs;
``(D) the gaps in home visitation in the State,
including identification of communities that are in
high need of the services; and
``(E) training and technical assistance activities
designed to achieve or support the goals of the
programs.
``(3) Assurances.--Assurances from the State that--
``(A) in supporting home visitation programs using
funds provided under this section, the State shall
identify and prioritize serving communities that are in
high need of such services, especially communities with
a high proportion of low-income families or a high
incidence of child maltreatment;
``(B) the State will reserve 5 percent of the grant
funds for training and technical assistance to the home
visitation programs using such funds;
``(C) in supporting home visitation programs using
funds provided under this section, the State will
promote coordination and collaboration with other home
visitation programs (including programs funded under
title XIX) and with other child and family services,
health services, income supports, and other related
assistance;
``(D) home visitation programs supported using such
funds will, when appropriate, provide referrals to
other programs serving children and families; and
``(E) the State will comply with subsection (i), and
cooperate with any evaluation conducted under
subsection (j).
``(4) Other information.--Such other information as the
Secretary may require.
``(c) Allotments.--
``(1) Indian tribes.--From the amount reserved under
subsection (l)(2) for a fiscal year, the Secretary shall allot
to each Indian tribe that meets the requirement of subsection
(d), if applicable, for the fiscal year the amount that bears
the same ratio to the amount so reserved as the number of
children in the Indian tribe whose families have income that
does not exceed 200 percent of the poverty line bears to the
total number of children in such Indian tribes whose families
have income that does not exceed 200 percent of the poverty
line.
``(2) States and territories.--From the amount appropriated
under subsection (m) for a fiscal year that remains after
making the reservations required by subsection (l), the
Secretary shall allot to each State that is not an Indian tribe
and that meets the requirement of subsection (d), if
applicable, for the fiscal year the amount that bears the same
ratio to the remainder of the amount so appropriated as the
number of children in the State whose families have income that
does not exceed 200 percent of the poverty line bears to the
total number of children in such States whose families have
income that does not exceed 200 percent of the poverty line.
``(3) Reallotments.--The amount of any allotment to a State
under a paragraph of this subsection for any fiscal year that
the State certifies to the Secretary will not be expended by
the State pursuant to this section shall be available for
reallotment using the allotment methodology specified in that
paragraph. Any amount so reallotted to a State is deemed part
of the allotment of the State under this subsection.
``(d) Maintenance of Effort.--Beginning with fiscal year 2011, a
State meets the requirement of this subsection for a fiscal year if the
Secretary finds that the aggregate expenditures by the State from State
and local sources for programs of home visitation for families with
young children and families expecting children for the then preceding
fiscal year was not less than 100 percent of such aggregate
expenditures for the then 2nd preceding fiscal year.
``(e) Payment of Grant.--
``(1) In general.--The Secretary shall make a grant to each
State that meets the requirements of subsections (b) and (d),
if applicable, for a fiscal year for which funds are
appropriated under subsection (m), in an amount equal to the
reimbursable percentage of the eligible expenditures of the
State for the fiscal year, but not more than the amount
allotted to the State under subsection (c) for the fiscal year.
``(2) Reimbursable percentage defined.--In paragraph (1), the
term `reimbursable percentage' means, with respect to a fiscal
year--
``(A) 85 percent, in the case of fiscal year 2010;
``(B) 80 percent, in the case of fiscal year 2011; or
``(C) 75 percent, in the case of fiscal year 2012 and
any succeeding fiscal year.
``(f) Eligible Expenditures.--
``(1) In general.--In this section, the term `eligible
expenditures'--
``(A) means expenditures to provide voluntary home
visitation for as many families with young children
(under the age of school entry) and families expecting
children as practicable, through the implementation or
expansion of high quality home visitation programs
that--
``(i) adhere to clear evidence-based models
of home visitation that have demonstrated
positive effects on important program-
determined child and parenting outcomes, such
as reducing abuse and neglect and improving
child health and development;
``(ii) employ well-trained and competent
staff, maintain high quality supervision,
provide for ongoing training and professional
development, and show strong organizational
capacity to implement such a program;
``(iii) establish appropriate linkages and
referrals to other community resources and
supports;
``(iv) monitor fidelity of program
implementation to ensure that services are
delivered according to the specified model; and
``(v) provide parents with--
``(I) knowledge of age-appropriate
child development in cognitive,
language, social, emotional, and motor
domains (including knowledge of second
language acquisition, in the case of
English language learners);
``(II) knowledge of realistic
expectations of age-appropriate child
behaviors;
``(III) knowledge of health and
wellness issues for children and
parents;
``(IV) modeling, consulting, and
coaching on parenting practices;
``(V) skills to interact with their
child to enhance age-appropriate
development;
``(VI) skills to recognize and seek
help for issues related to health,
developmental delays, and social,
emotional, and behavioral skills; and
``(VII) activities designed to help
parents become full partners in the
education of their children;
``(B) includes expenditures for training, technical
assistance, and evaluations related to the programs;
and
``(C) does not include any expenditure with respect
to which a State has submitted a claim for payment
under any other provision of Federal law.
``(2) Priority funding for programs with strongest
evidence.--
``(A) In general.--The expenditures, described in
paragraph (1), of a State for a fiscal year that are
attributable to the cost of programs that do not adhere
to a model of home visitation with the strongest
evidence of effectiveness shall not be considered
eligible expenditures for the fiscal year to the extent
that the total of the expenditures exceeds the
applicable percentage for the fiscal year of the
allotment of the State under subsection (c) for the
fiscal year.
``(B) Applicable percentage defined.--In subparagraph
(A), the term `applicable percentage' means, with
respect to a fiscal year--
``(i) 60 percent for fiscal year 2010;
``(ii) 55 percent for fiscal year 2011;
``(iii) 50 percent for fiscal year 2012;
``(iv) 45 percent for fiscal year 2013; or
``(v) 40 percent for fiscal year 2014.
``(g) No Use of Other Federal Funds for State Match.--A State to
which a grant is made under this section may not expend any Federal
funds to meet the State share of the cost of an eligible expenditure
for which the State receives a payment under this section.
``(h) Waiver Authority.--
``(1) In general.--The Secretary may waive or modify the
application of any provision of this section, other than
subsection (b) or (f), to an Indian tribe if the failure to do
so would impose an undue burden on the Indian tribe.
``(2) Special rule.--An Indian tribe is deemed to meet the
requirement of subsection (d) for purposes of subsections (c)
and (e) if--
``(A) the Secretary waives the requirement; or
``(B) the Secretary modifies the requirement, and the
Indian tribe meets the modified requirement.
``(i) State Reports.--Each State to which a grant is made under this
section shall submit to the Secretary an annual report on the progress
made by the State in addressing the purposes of this section. Each such
report shall include a description of--
``(1) the services delivered by the programs that received
funds from the grant;
``(2) the characteristics of each such program, including
information on the service model used by the program and the
performance of the program;
``(3) the characteristics of the providers of services
through the program, including staff qualifications, work
experience, and demographic characteristics;
``(4) the characteristics of the recipients of services
provided through the program, including the number of the
recipients, the demographic characteristics of the recipients,
and family retention;
``(5) the annual cost of implementing the program, including
the cost per family served under the program;
``(6) the outcomes experienced by recipients of services
through the program;
``(7) the training and technical assistance provided to aid
implementation of the program, and how the training and
technical assistance contributed to the outcomes achieved
through the program;
``(8) the indicators and methods used to monitor whether the
program is being implemented as designed; and
``(9) other information as determined necessary by the
Secretary.
``(j) Evaluation.--
``(1) In general.--The Secretary shall, by grant or contract,
provide for the conduct of an independent evaluation of the
effectiveness of home visitation programs receiving funds
provided under this section, which shall examine the following:
``(A) The effect of home visitation programs on child
and parent outcomes, including child maltreatment,
child health and development, school readiness, and
links to community services.
``(B) The effectiveness of home visitation programs
on different populations, including the extent to which
the ability of programs to improve outcomes varies
across programs and populations.
``(2) Reports to the congress.--
``(A) Interim report.--Within 3 years after the date
of the enactment of this section, the Secretary shall
submit to the Congress an interim report on the
evaluation conducted pursuant to paragraph (1).
``(B) Final report.--Within 5 years after the date of
the enactment of this section, the Secretary shall
submit to the Congress a final report on the evaluation
conducted pursuant to paragraph (1).
``(k) Annual Reports to the Congress.--The Secretary shall submit
annually to the Congress a report on the activities carried out using
funds made available under this section, which shall include a
description of the following:
``(1) The high need communities targeted by States for
programs carried out under this section.
``(2) The service delivery models used in the programs
receiving funds provided under this section.
``(3) The characteristics of the programs, including--
``(A) the qualifications and demographic
characteristics of program staff; and
``(B) recipient characteristics including the number
of families served, the demographic characteristics of
the families served, and family retention and duration
of services.
``(4) The outcomes reported by the programs.
``(5) The research-based instruction, materials, and
activities being used in the activities funded under the grant.
``(6) The training and technical activities, including on-
going professional development, provided to the programs.
``(7) The annual costs of implementing the programs,
including the cost per family served under the programs.
``(8) The indicators and methods used by States to monitor
whether the programs are being been implemented as designed.
``(l) Reservations of Funds.--From the amounts appropriated for a
fiscal year under subsection (m), the Secretary shall reserve--
``(1) an amount equal to 5 percent of the amounts to pay the
cost of the evaluation provided for in subsection (j), and the
provision to States of training and technical assistance,
including the dissemination of best practices in early
childhood home visitation; and
``(2) after making the reservation required by paragraph (1),
an amount equal to 3 percent of the amount so appropriated, to
pay for grants to Indian tribes under this section.
``(m) Appropriations.--Out of any money in the Treasury of the United
States not otherwise appropriated, there is appropriated to the
Secretary to carry out this section--
``(1) $50,000,000 for fiscal year 2010;
``(2) $100,000,000 for fiscal year 2011;
``(3) $150,000,000 for fiscal year 2012;
``(4) $200,000,000 for fiscal year 2013; and
``(5) $250,000,000 for fiscal year 2014.
``(n) Indian Tribes Treated as States.--In this section, paragraphs
(4), (5), and (6) of section 431(a) shall apply.''.
SEC. 1905. IMPROVED COORDINATION AND PROTECTION FOR DUAL ELIGIBLES.
Title XI of the Social Security Act is amended by inserting after
section 1150 the following new section:
``improved coordination and protection for dual eligibles
``Sec. 1150A. (a) In General.--The Secretary shall provide, through
an identifiable office or program within the Centers for Medicare &
Medicaid Services, for a focused effort to provide for improved
coordination between Medicare and Medicaid and protection in the case
of dual eligibles (as defined in subsection (e)). The office or program
shall--
``(1) review Medicare and Medicaid policies related to
enrollment, benefits, service delivery, payment, and grievance
and appeals processes under parts A and B of title XVIII, under
the Medicare Advantage program under part C of such title, and
under title XIX;
``(2) identify areas of such policies where better
coordination and protection could improve care and costs; and
``(3) issue guidance to States regarding improving such
coordination and protection.
``(b) Elements.--The improved coordination and protection under this
section shall include efforts--
``(1) to simplify access of dual eligibles to benefits and
services under Medicare and Medicaid;
``(2) to improve care continuity for dual eligibles and
ensure safe and effective care transitions;
``(3) to harmonize regulatory conflicts between Medicare and
Medicaid rules with regard to dual eligibles; and
``(4) to improve total cost and quality performance under
Medicare and Medicaid for dual eligibles.
``(c) Responsibilities.--In carrying out this section, the Secretary
shall provide for the following:
``(1) An examination of Medicare and Medicaid payment systems
to develop strategies to foster more integrated and higher
quality care.
``(2) Development of methods to facilitate access to post-
acute and community-based services and to identify actions that
could lead to better coordination of community-based care.
``(3) A study of enrollment of dual eligibles in the Medicare
Savings Program (as defined in section 1144(c)(7)), under
Medicaid, and in the low-income subsidy program under section
1860D-14 to identify methods to more efficiently and
effectively reach and enroll dual eligibles.
``(4) An assessment of communication strategies for dual
eligibles to determine whether additional informational
materials or outreach is needed, including an assessment of the
Medicare website, 1-800-MEDICARE, and the Medicare handbook.
``(5) Research and evaluation of areas where service
utilization, quality, and access to cost sharing protection
could be improved and an assessment of factors related to
enrollee satisfaction with services and care delivery.
``(6) Collection (and making available to the public) of data
and a database that describe the eligibility, benefit and cost-
sharing assistance available to dual eligibles by State.
``(7) Monitoring total combined Medicare and Medicaid program
costs in serving dual eligibles and making recommendations for
optimizing total quality and cost performance across both
programs.
``(8) Coordination of activities relating to Medicare
Advantage plans under 1859(b)(6)(B)(ii) and Medicaid.
``(d) Periodic Reports.--Not later than 1 year after the date of the
enactment of this section and every 3 years thereafter the Secretary
shall submit to Congress a report on progress in activities conducted
under this section.
``(e) Definitions.--In this section:
``(1) Dual eligible.--The term `dual eligible' means an
individual who is dually eligible for benefits under title
XVIII, and medical assistance under title XIX, including such
individuals who are eligible for benefits under the Medicare
Savings Program (as defined in section 1144(c)(7)).
``(2) Medicare; medicaid.--The terms `Medicare' and
`Medicaid' mean the programs under titles XVIII and XIX,
respectively.''.
SEC. 1906. STANDARDIZED MARKETING REQUIREMENTS UNDER THE MEDICARE
ADVANTAGE AND MEDICARE PRESCRIPTION DRUG PROGRAMS.
(a) Medicare Advantage Program.--
(1) In general.--Section 1856 of the Social Security Act (42
U.S.C. 1395w-26) is amended--
(A) in subsection (b)(1), by inserting ``or
subsection (c)'' after ``subsection (a)''; and
(B) by adding at the end the following new
subsection:
``(c) Standardized Marketing Requirements.--
``(1) Development by the naic.--
``(A) Requirements.--The Secretary shall request the
National Association of Insurance Commissioners (in
this subsection referred to as the `NAIC') to--
``(i) develop standardized marketing
requirements for Medicare Advantage
organizations with respect to Medicare
Advantage plans and PDP sponsors with respect
to prescription drug plans under part D; and
``(ii) submit a report containing such
requirements to the Secretary by not later than
the date that is 9 months after the date of the
enactment of this subsection.
``(B) Prohibited activities.--Such requirements shall
include prohibitions on the prohibited activities
described in section 1851(j)(1).
``(C) Limitations.--Such requirements shall establish
limitations that include at least the limitations
described in section 1851(j)(2), except for those
relating to compensation.
``(D) Election form.--Such requirements may prohibit
a Medicare Advantage organization or a PDP sponsor (or
an agent of such an organization or sponsor) from
completing any portion of any election form used to
carry out elections under section 1851 or 1860D-1 on
behalf of any individual.
``(E) Agent and broker commissions and
compensation.--Such requirements shall establish
standards--
``(i) for fair and appropriate commissions
for agents and brokers of Medicare Advantage
organizations and PDP sponsors, including a
prohibition on extra bonuses or incentives;
``(ii) for the disclosure of such
commissions; and
``(iii) for the use of compensation for
agents and brokers other than such commissions.
Such standards shall ensure that the use of
compensation creates incentives for agents and brokers
to enroll individuals in the Medicare Advantage plan
that is intended to best meet their health care needs.
``(F) Certain conduct of agents.--Such requirements
shall address the conduct of agents engaged in on-site
promotion at a facility of an organization with which
the Medicare Advantage organization or PDP sponsor has
a co-branding relationship.
``(G) Other standards.--Such requirements may
establish such other standards relating to unfair trade
practices and marketing under Medicare Advantage plans
and prescription drug plans under part D as the NAIC
determines appropriate.
``(2) Implementation of requirements.--
``(A) Adoption of naic developed requirements.--If
the NAIC develops standardized marketing requirements
and submits the report pursuant to paragraph (1), the
Secretary shall promulgate regulations for the adoption
of such requirements. The Secretary shall ensure that
such regulations take effect beginning with the first
open enrollment period beginning 12 months after the
date of the enactment of this subsection.
``(B) Requirements if naic does not submit report.--
If the NAIC does not develop standardized marketing
requirements and submit the report pursuant to
paragraph (1), the Secretary shall promulgate
regulations for standardized marketing requirements for
Medicare Advantage organizations with respect to
Medicare Advantage plans and PDP sponsors with respect
to prescription drug plans under part D. Such
regulations shall meet the requirements of
subparagraphs (B) through (F) of paragraph (1), and may
establish such other standards relating to marketing
under Medicare Advantage plans and prescription drug
plans as the Secretary determines appropriate. The
Secretary shall ensure that such regulations take
effect beginning with the first open enrollment period
beginning 12 months after the date of the enactment of
this subsection.
``(C) Consultation.--In establishing requirements
under this subsection, the NAIC or Secretary (as the
case may be) shall consult with a working group
composed of representatives of Medicare Advantage
organizations and PDP sponsors, consumer groups, and
other qualified individuals. Such representatives shall
be selected in a manner so as to insure balanced
representation among the interested groups.
``(3) State reporting of violations of standardized marketing
requirements.--The Secretary shall request that States report
any violations of the standardized marketing requirements under
the regulations under subparagraph (A) or (B) of paragraph (2)
to national and regional offices of the Centers for Medicare &
Medicaid Services.
``(4) Report.--The Secretary shall submit an annual report to
Congress on the enforcement of the standardized marketing
requirements under the regulations under subparagraph (A) or
(B) of paragraph (2), together with such recommendations as the
Secretary determines appropriate. Such report shall include--
``(A) a list of any alleged violations of such
requirements reported to the Secretary by a State, a
Medicare Advantage organization, or a PDP sponsor; and
``(B) the disposition of such reported violations.''.
(2) State authority to enforce standardized marketing
requirements.--
(A) In general.--Section 1856(b)(3) of the Social
Security Act (42 U.S.C. 1395w-26(b)(3)) is amended--
(i) by striking ``or State'' and inserting
``, State''; and
(ii) by inserting ``, or State laws or
regulations enacting the standardized marketing
requirements under subsection (c)'' after
``plan solvency''.
(B) No preemption of state sanctions.--Nothing in
title XVIII of the Social Security Act or the
provisions of, or amendments made by, this Act, shall
be construed to prohibit a State from conducting a
market conduct examination or from imposing sanctions
against Medicare Advantage organizations, PDP sponsors,
or agents or brokers of such organizations or sponsors
for violations of the standardized marketing
requirements under subsection (c) of section 1856 of
the Social Security Act (as added by paragraph (1)) as
enacted by that State.
(3) Conforming amendment.--Section 1851(h)(4) of the Social
Security Act (42 U.S.C. 1395w-21(h)(4)) is amended by adding at
the end the following flush sentence:
``Beginning on the effective date of the implementation of the
regulations under subparagraph (A) or (B) of section
1856(c)(2), each Medicare Advantage organization with respect
to a Medicare Advantage plan offered by the organization (and
agents of such organization) shall comply with the standardized
marketing requirements under section 1856(c).''.
(b) Medicare Prescription Drug Program.--Section 1860D-4 of the
Social Security Act (42 U.S.C. 1395w-104) is amended by adding at the
end the following new subsection:
``(m) Standardized Marketing Requirements.--A PDP sponsor with
respect to a prescription drug plan offered by the sponsor (and agents
of such sponsor) shall comply with the standardized marketing
requirements under section 1856(c).''.
SEC. 1907. NAIC RECOMMENDATIONS ON THE ESTABLISHMENT OF STANDARDIZED
BENEFIT PACKAGES FOR MEDICARE ADVANTAGE PLANS AND
PRESCRIPTION DRUG PLANS.
Not later than 30 days after the date of the enactment of this Act,
the Secretary of Health and Human Services shall request the National
Association of Insurance Commissioners to establish a committee to
study and make recommendations to the Secretary and Congress on--
(1) the establishment of standardized benefit packages for
Medicare Advantage plans under part C of title XVIII of the
Social Security Act and for prescription drug plans under part
D of such Act; and
(2) the regulation of such plans.
SEC. 1908. APPLICATION OF EMERGENCY SERVICES LAWS.
Nothing in this Act shall be construed to relieve any health care
provider from providing emergency services as required by State or
Federal law, including section 1867 of the Social Security Act
(popularly known as ``EMTALA'').
SEC. 1909. NATIONWIDE PROGRAM FOR NATIONAL AND STATE BACKGROUND CHECKS
ON DIRECT PATIENT ACCESS EMPLOYEES OF LONG-TERM
CARE FACILITIES AND PROVIDERS.
(a) In General.--The Secretary of Health and Human Services (in this
section referred to as the ``Secretary''), shall establish a program to
identify efficient, effective, and economical procedures for long term
care facilities or providers to conduct background checks on
prospective direct patient access employees on a nationwide basis (in
this subsection, such program shall be referred to as the ``nationwide
program''). Except for the following modifications, the Secretary shall
carry out the nationwide program under similar terms and conditions as
the pilot program under section 307 of the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003 (Public Law 108-173; 117
Stat. 2257), including the prohibition on hiring abusive workers and
the authorization of the imposition of penalties by a participating
State under subsections (b)(3)(A) and (b)(6), respectively, of such
section 307:
(1) Agreements.--
(A) Newly participating states.--The Secretary shall
enter into agreements with each State--
(i) that the Secretary has not entered into
an agreement with under subsection (c)(1) of
such section 307;
(ii) that agrees to conduct background checks
under the nationwide program on a Statewide
basis; and
(iii) that submits an application to the
Secretary containing such information and at
such time as the Secretary may specify.
(B) Certain previously participating states.--The
Secretary shall enter into agreements with each State--
(i) that the Secretary has entered into an
agreement with under such subsection (c)(1),
but only in the case where such agreement did
not require the State to conduct background
checks under the program established under
subsection (a) of such section 307 on a
Statewide basis;
(ii) that agrees to conduct background checks
under the nationwide program on a Statewide
basis; and
(iii) that submits an application to the
Secretary containing such information and at
such time as the Secretary may specify.
(2) Nonapplication of selection criteria.--The selection
criteria required under subsection (c)(3)(B) of such section
307 shall not apply.
(3) Required fingerprint check as part of criminal history
background check.--The procedures established under subsection
(b)(1) of such section 307 shall--
(A) require that the long-term care facility or
provider (or the designated agent of the long-term care
facility or provider) obtain State and national
criminal history background checks on the prospective
employee through such means as the Secretary determines
appropriate that utilize a search of State-based abuse
and neglect registries and databases, including the
abuse and neglect registries of another State in the
case where a prospective employee previously resided in
that State, State criminal history records, the records
of any proceedings in the State that may contain
disqualifying information about prospective employees
(such as proceedings conducted by State professional
licensing and disciplinary boards and State Medicaid
Fraud Control Units), and Federal criminal history
records, including a fingerprint check using the
Integrated Automated Fingerprint Identification System
of the Federal Bureau of Investigation; and
(B) require States to describe and test methods that
reduce duplicative fingerprinting, including providing
for the development of ``rap back'' capability by the
State such that, if a direct patient access employee of
a long-term care facility or provider is convicted of a
crime following the initial criminal history background
check conducted with respect to such employee, and the
employee's fingerprints match the prints on file with
the State law enforcement department, the department
will immediately inform the State and the State will
immediately inform the long-term care facility or
provider which employs the direct patient access
employee of such conviction.
(4) State requirements.--An agreement entered into under
paragraph (1) shall require that a participating State--
(A) be responsible for monitoring compliance with the
requirements of the nationwide program;
(B) have procedures in place to--
(i) conduct screening and criminal history
background checks under the nationwide program
in accordance with the requirements of this
section;
(ii) monitor compliance by long-term care
facilities and providers with the procedures
and requirements of the nationwide program;
(iii) as appropriate, provide for a
provisional period of employment by a long-term
care facility or provider of a direct patient
access employee, not to exceed 30 days, pending
completion of the required criminal history
background check and, in the case where the
employee has appealed the results of such
background check, pending completion of the
appeals process, during which the employee
shall be subject to direct on-site supervision
(in accordance with procedures established by
the State to ensure that a long-term care
facility or provider furnishes such direct on-
site supervision);
(iv) provide an independent process by which
a provisional employee or an employee may
appeal or dispute the accuracy of the
information obtained in a background check
performed under the nationwide program,
including the specification of criteria for
appeals for direct patient access employees
found to have disqualifying information which
shall include consideration of the passage of
time, extenuating circumstances, demonstration
of rehabilitation, and relevancy of the
particular disqualifying information with
respect to the current employment of the
individual;
(v) provide for the designation of a single
State agency as responsible for--
(I) overseeing the coordination of
any State and national criminal history
background checks requested by a long-
term care facility or provider (or the
designated agent of the long-term care
facility or provider) utilizing a
search of State and Federal criminal
history records, including a
fingerprint check of such records;
(II) overseeing the design of
appropriate privacy and security
safeguards for use in the review of the
results of any State or national
criminal history background checks
conducted regarding a prospective
direct patient access employee to
determine whether the employee has any
conviction for a relevant crime;
(III) immediately reporting to the
long-term care facility or provider
that requested the criminal history
background check the results of such
review; and
(IV) in the case of an employee with
a conviction for a relevant crime that
is subject to reporting under section
1128E of the Social Security Act (42
U.S.C. 1320a-7e), reporting the
existence of such conviction to the
database established under that
section;
(vi) determine which individuals are direct
patient access employees (as defined in
paragraph (6)(B)) for purposes of the
nationwide program;
(vii) as appropriate, specify offenses,
including convictions for violent crimes, for
purposes of the nationwide program; and
(viii) describe and test methods that reduce
duplicative fingerprinting, including providing
for the development of ``rap back'' capability
such that, if a direct patient access employee
of a long-term care facility or provider is
convicted of a crime following the initial
criminal history background check conducted
with respect to such employee, and the
employee's fingerprints match the prints on
file with the State law enforcement
department--
(I) the department will immediately
inform the State agency designated
under clause (v) and such agency will
immediately inform the facility or
provider which employs the direct
patient access employee of such
conviction; and
(II) the State will provide, or will
require the facility to provide, to the
employee a copy of the results of the
criminal history background check
conducted with respect to the employee
at no charge in the case where the
individual requests such a copy.
(5) Payments.--
(A) Newly participating states.--
(i) In general.--As part of the application
submitted by a State under paragraph
(1)(A)(iii), the State shall guarantee, with
respect to the costs to be incurred by the
State in carrying out the nationwide program,
that the State will make available (directly or
through donations from public or private
entities) a particular amount of non-Federal
contributions, as a condition of receiving the
Federal match under clause (ii).
(ii) Federal match.--The payment amount to
each State that the Secretary enters into an
agreement with under paragraph (1)(A) shall be
3 times the amount that the State guarantees to
make available under clause (i), except that in
no case may the payment amount exceed
$3,000,000.
(B) Previously participating states.--
(i) In general.--As part of the application
submitted by a State under paragraph
(1)(B)(iii), the State shall guarantee, with
respect to the costs to be incurred by the
State in carrying out the nationwide program,
that the State will make available (directly or
through donations from public or private
entities) a particular amount of non-Federal
contributions, as a condition of receiving the
Federal match under clause (ii).
(ii) Federal match.--The payment amount to
each State that the Secretary enters into an
agreement with under paragraph (1)(B) shall be
3 times the amount that the State guarantees to
make available under clause (i), except that in
no case may the payment amount exceed
$1,500,000.
(6) Definitions.--Under the nationwide program:
(A) Long-term care facility or provider.--The term
``long-term care facility or provider'' means the
following facilities or providers which receive payment
for services under title XVIII or XIX of the Social
Security Act:
(i) A skilled nursing facility (as defined in
section 1819(a) of the Social Security Act (42
U.S.C. 1395i-3(a))).
(ii) A nursing facility (as defined in
section 1919(a) of such Act (42 U.S.C.
1396r(a))).
(iii) A home health agency.
(iv) A provider of hospice care (as defined
in section 1861(dd)(1) of such Act (42 U.S.C.
1395x(dd)(1))).
(v) A long-term care hospital (as described
in section 1886(d)(1)(B)(iv) of such Act (42
U.S.C. 1395ww(d)(1)(B)(iv))).
(vi) A provider of personal care services.
(vii) A provider of adult day care.
(viii) A residential care provider that
arranges for, or directly provides, long-term
care services, including an assisted living
facility that provides a level of care
established by the Secretary.
(ix) An intermediate care facility for the
mentally retarded (as defined in section
1905(d) of such Act (42 U.S.C. 1396d(d))).
(x) Any other facility or provider of long-
term care services under such titles as the
participating State determines appropriate.
(B) Direct patient access employee.--The term
``direct patient access employee'' means any individual
who has access to a patient or resident of a long-term
care facility or provider through employment or through
a contract with such facility or provider and has
duties that involve (or may involve) one-on-one contact
with a patient or resident of the facility or provider,
as determined by the State for purposes of the
nationwide program. Such term does not include a
volunteer unless the volunteer has duties that are
equivalent to the duties of a direct patient access
employee and those duties involve (or may involve) one-
on-one contact with a patient or resident of the long-
term care facility or provider.
(7) Evaluation and report.--
(A) Evaluation.--The Inspector General of the
Department of Health and Human Services shall conduct
an evaluation of the nationwide program.
(B) Report.--Not later than 180 days after the
completion of the nationwide program, the Inspector
General of the Department of Health and Human Services
shall submit a report to Congress containing the
results of the evaluation conducted under subparagraph
(A).
(b) Funding.--
(1) Notification.--The Secretary of Health and Human Services
shall notify the Secretary of the Treasury of the amount
necessary to carry out the nationwide program under this
section for the period of fiscal years 2010 through 2012,
except that in no case shall such amount exceed $160,000,000.
(2) Transfer of funds.--Out of any funds in the Treasury not
otherwise appropriated, the Secretary of the Treasury shall
provide for the transfer to the Secretary of Health and Human
Services of the amount specified as necessary to carry out the
nationwide program under paragraph (1). Such amount shall
remain available until expended.
SEC. 1910. ESTABLISHMENT OF CENTER FOR MEDICARE AND MEDICAID PAYMENT
INNOVATION WITHIN CMS.
(a) In General.--Title XI of the Social Security Act is amended by
inserting after section 1115 the following new section:
``center for medicare and medicaid payment innovation
``Sec. 1115A. (a) Center for Medicare and Medicaid Payment
Innovation Established.--
``(1) In general.--There is created within the Centers for
Medicare & Medicaid Services a Center for Medicare and Medicaid
Payment Innovation (in this section referred to as the `CMPI')
to carry out the duties described in paragraph (4).
``(2) Director.--The CMPI shall be headed by a Director who
shall report directly to the Administrator of the Centers for
Medicare & Medicaid Services.
``(3) Deadline.--The Secretary shall ensure that the CMPI is
carrying out the duties described in paragraph (4) by not later
than January 1, 2011.
``(4) Duties.--The duties described in this paragraph are the
following:
``(A) To carry out the duties described in this
section.
``(B) Such other duties as the Secretary may specify.
``(5) Consultation.--In carrying out the duties under
paragraph (4), the CMPI shall consult representatives of
relevant Federal agencies and outside clinical and analytical
experts with expertise in medicine and health care management.
The CMPI shall use open door forums or other mechanisms to seek
input from interested parties.
``(b) Testing of Models (Phase I).--
``(1) In general.--The CMPI shall test payment models in
accordance with selection criteria under paragraph (2) to
determine the effect of applying such models under title XVIII,
title XIX, or both titles on program expenditures under such
titles and the quality of care received by individuals
receiving benefits under such titles.
``(2) Selection of models to be tested.--
``(A) In general.--The Secretary shall give
preference to testing models for which, as determined
by the professional staff at the Centers for Medicare &
Medicaid Services and using such input from outside the
Centers as the Secretary determines appropriate, there
is evidence that the model addresses a defined
population for which there are deficits in care leading
to poor clinical outcomes or potentially avoidable
expenditures. The Secretary shall focus on models
expected to reduce program costs under title XVIII,
title XIX, or both titles while preserving or enhancing
the quality of care received by individuals receiving
benefits under such titles.
``(B) Application to other demonstrations.--The
Secretary shall operate the demonstration programs
under sections 1222 and 1236 of the America's
Affordable Health Choices Act of 2009 through the CMPI
in accordance with the rules applicable under this
section, including those relating to evaluations,
terminations, and expansions.
``(3) Budget neutrality.--
``(A) Initial period.--The Secretary shall not
require as a condition for testing a model under
paragraph (1) that the design of the model ensure that
the model is budget neutral initially with respect to
expenditures under titles XVIII and XIX.
``(B) Termination.--The Secretary shall terminate or
modify the design and implementation of a model unless
the Secretary determines (and the Chief Actuary of the
Centers for Medicare & Medicaid Services, with respect
to spending under such titles, certifies), after
testing has begun, that the model is expected to--
``(i) improve the quality of patient care (as
determined by the Administrator of the Centers
for Medicare & Medicaid Services) without
increasing spending under such titles;
``(ii) reduce spending under such titles
without reducing the quality of patient care;
or
``(iii) do both.
Such termination may occur at any time after such
testing has begun and before completion of the testing.
``(4) Evaluation.--The Secretary shall conduct an evaluation
of each model tested under this subsection. Such evaluation
shall include an analysis of--
``(A) the quality of patient care furnished under the
model, including through the use of patient-level
outcomes measures; and
``(B) the changes in spending under titles XVIII and
XIX by reason of the model.
The Secretary shall make the results of each evaluation under
this paragraph available to the public in a timely fashion.
``(c) Expansion of Models (Phase II).--The Secretary may expand the
duration and the scope of a model that is being tested under subsection
(b) (including implementation on a nationwide basis), to the extent
determined appropriate by the Secretary, if--
``(1) the Secretary determines that such expansion is
expected--
``(A) to improve the quality of patient care without
increasing spending under titles XVIII and XIX;
``(B) to reduce spending under such titles without
reducing the quality of patient care; or
``(C) to do both; and
``(2) the Chief Actuary of the Centers for Medicare &
Medicaid Services certifies that such expansion would reduce
(or not result in any increase in) net program spending under
such titles.
``(d) Implementation.--
``(1) Waiver authority.--The Secretary may waive such
requirements of title XVIII and of sections 1902(a)(1),
1902(a)(13), and 1903(m)(2)(A)(iii) as may be necessary solely
for purposes of carrying out this section with respect to
testing models described in subsection (b).
``(2) Limitations on review.--There shall be no
administrative or judicial review under section 1869, section
1878, or otherwise of--
``(A) the selection of models for testing or
expansion under this section;
``(B) the elements, parameters, scope, and duration
of such models for testing or dissemination;
``(C) the termination or modification of the design
and implementation of a model under subsection
(b)(3)(B); and
``(D) determinations about expansion of the duration
and scope of a model under subsection (c) including the
determination that a model is not expected to meet
criteria described in paragraphs (1) or (2) of such
subsection.
``(3) Administration.--Chapter 35 of title 44, United States
Code shall not apply to this section and testing and evaluation
of models or expansion of such models under this section.
``(4) Funding for testing items and services and
administrative costs.--There shall be available from the
Federal Supplementary Medical Insurance Trust Fund for payments
for designing, conducting, and evaluating payment models, as
well as for additional benefits for items and services under
models tested under subsection (b) not otherwise covered under
this title and the evaluation of such models, $350,000,000 for
fiscal year 2010 and, for a subsequent fiscal year, the amount
determined under this sentence for the preceding fiscal year
increased by the annual percentage rate of increase in total
expenditures under this title for the previous fiscal year.
There are also appropriated, from any amounts in the Treasury
not otherwise appropriated, $25,000,000 for each fiscal year
(beginning with fiscal year 2010) for administrative costs of
administering this section with respect to the Medicaid program
under title XIX of the Social Security Act.
``(e) Report to Congress.--Beginning in 2012, and not less than once
every other year thereafter, the Secretary shall submit to Congress a
report on activities under this section. Each such report shall
describe the payment models tested under subsection (b), any models
chosen for expansion under subsection (c), and the results from
evaluations under subsection (b)(4). In addition, each such report
shall provide such recommendations as the Secretary believes are
appropriate for legislative action to facilitate the development and
expansion of successful payment models.''.
(b) Medicaid Conforming Amendment.--Section 1902(a) of the Social
Security Act (42 U.S.C. 1396a(a)), as amended by sections 1631(b),
1703(a), 1729, 1753, 1757(a), and 1759(a), is amended--
(1) in paragraph (78), by striking ``and'' at the end;
(2) in paragraph (79), by striking the period at the end and
inserting ``; and''; and
(3) by inserting after paragraph (79) the following new
paragraph:
``(80) provide for implementation of the payment models
specified by the Secretary under section 1115A(c) for
implementation on a nationwide basis unless the State
demonstrates to the satisfaction of the Secretary that
implementation would not be administratively feasible or
appropriate to the health care delivery system of the State.''.
DIVISION C--PUBLIC HEALTH AND WORKFORCE DEVELOPMENT
SEC. 2001. TABLE OF CONTENTS; REFERENCES.
(a) Table of Contents.--The table of contents of this division is as
follows:
Sec. 2001. Table of contents; references.
Sec. 2002. Public Health Investment Fund.
TITLE I--COMMUNITY HEALTH CENTERS
Sec. 2101. Increased funding.
TITLE II--WORKFORCE
Subtitle A--Primary Care Workforce
Part 1--National Health Service Corps
Sec. 2201. National Health Service Corps.
Sec. 2202. Authorizations of appropriations.
Part 2--Promotion of Primary Care and Dentistry
Sec. 2211. Frontline health providers.
Sec. 2212. Primary care student loan funds.
Sec. 2213. Training in family medicine, general internal medicine,
general pediatrics, geriatrics, and physician assistants.
Sec. 2214. Training of medical residents in community-based settings.
Sec. 2215. Training for general, pediatric, and public health dentists
and dental hygienists.
Sec. 2216. Authorization of appropriations.
Sec. 2217. Study on effectiveness of scholarships and loan repayments.
Subtitle B--Nursing Workforce
Sec. 2221. Amendments to Public Health Service Act.
Subtitle C--Public Health Workforce
Sec. 2231. Public Health Workforce Corps.
Sec. 2232. Enhancing the public health workforce.
Sec. 2233. Public health training centers.
Sec. 2234. Preventive medicine and public health training grant
program.
Sec. 2235. Authorization of appropriations.
Subtitle D--Adapting Workforce to Evolving Health System Needs
Part 1--Health Professions Training for Diversity
Sec. 2241. Scholarships for disadvantaged students, loan repayments and
fellowships regarding faculty positions, and educational assistance in
the health professions regarding individuals from disadvantaged
backgrounds.
Sec. 2242. Nursing workforce diversity grants.
Sec. 2243. Coordination of diversity and cultural competency programs.
Part 2--Interdisciplinary Training Programs
Sec. 2251. Cultural and linguistic competency training for health
professionals.
Sec. 2252. Innovations in interdisciplinary care training.
Part 3--Advisory Committee on Health Workforce Evaluation and
Assessment
Sec. 2261. Health workforce evaluation and assessment.
Part 4--Health Workforce Assessment
Sec. 2271. Health workforce assessment.
Part 5--Authorization of Appropriations
Sec. 2281. Authorization of appropriations.
TITLE III--PREVENTION AND WELLNESS
Sec. 2301. Prevention and wellness.
``TITLE XXXI--PREVENTION AND WELLNESS
``Subtitle A--Prevention and Wellness Trust
``Sec. 3111. Prevention and Wellness Trust.
``Subtitle B--National Prevention and Wellness Strategy
``Sec. 3121. National Prevention and Wellness Strategy.
``Subtitle C--Prevention Task Forces
``Sec. 3131. Task Force on Clinical Preventive Services.
``Sec. 3132. Task Force on Community Preventive Services.
``Subtitle D--Prevention and Wellness Research
``Sec. 3141. Prevention and wellness research activity
coordination.
``Sec. 3142. Community prevention and wellness research grants.
``Subtitle E--Delivery of Community Prevention and Wellness Services
``Sec. 3151. Community prevention and wellness services grants.
``Subtitle F--Core Public Health Infrastructure
``Sec. 3161. Core public health infrastructure for State,
local, and tribal health departments.
``Sec. 3162. Core public health infrastructure and activities
for CDC.
``Subtitle G--General Provisions
``Sec. 3171. Definitions.
TITLE IV--QUALITY AND SURVEILLANCE
Sec. 2401. Implementation of best practices in the delivery of health
care.
Sec. 2402. Assistant Secretary for Health Information.
Sec. 2403. Authorization of appropriations.
TITLE V--OTHER PROVISIONS
Subtitle A--Drug Discount for Rural and Other Hospitals
Sec. 2501. Expanded participation in 340B program.
Sec. 2502. Extension of discounts to inpatient drugs.
Sec. 2503. Effective date.
Subtitle B--Programs
Part 1--Grants for Clinics and Centers
Sec. 2511. School-based health clinics.
Sec. 2512. Nurse-managed health centers.
Sec. 2513. Federally qualified behavioral health centers.
Part 2--Other Grant Programs
Sec. 2521. Comprehensive programs to provide education to nurses and
create a pipeline to nursing.
Sec. 2522. Mental and behavioral health training.
Sec. 2523. Programs to increase awareness of advance care planning
issues.
Sec. 2524. Reauthorization of telehealth and telemedicine grant
programs.
Sec. 2525. No child left unimmunized against influenza: demonstration
program using elementary and secondary schools as influenza vaccination
centers.
Sec. 2526. Extension of Wisewoman Program.
Sec. 2527. Healthy teen initiative to prevent teen pregnancy.
Sec. 2528. National training initiative on autism supplemental grants
and technical assistance.
Sec. 2529. Implementation of medication management services in
treatment of chronic diseases.
Sec. 2530. Postpartum depression.
Sec. 2531. Grants to promote positive health behaviors and outcomes.
Part 3--Emergency Care-related Programs
Sec. 2541. Trauma care centers.
Sec. 2542. Emergency care coordination.
Sec. 2543. Pilot programs to improve emergency medical care.
Sec. 2544. Assisting veterans with military emergency medical training
to become State-licensed or certified emergency medical technicians
(EMTs).
Sec. 2545. Dental emergency responders: public health and medical
response.
Sec. 2546. Dental emergency responders: homeland security.
Part 4--Pain Care and Management Programs
Sec. 2551. Institute of Medicine Conference on Pain.
Sec. 2552. Pain research at National Institutes of Health.
Sec. 2553. Public awareness campaign on pain management.
Subtitle C--Food and Drug Administration
Part 1--In General
Sec. 2561. National medical device registry.
Sec. 2562. Nutrition labeling of standard menu items at chain
restaurants and of articles of food sold from vending machines.
Sec. 2563. Protecting consumer access to generic drugs.
Part 2--Biosimilars
Sec. 2565. Licensure pathway for biosimilar biological products.
Sec. 2566. Fees relating to biosimilar biological products.
Subtitle D--Community Living Assistance Services and Supports
Sec. 2571. Establishment of national voluntary insurance program for
purchasing community living assistance services and supports.
Subtitle E--Miscellaneous
Sec. 2581. States failing to adhere to certain employment obligations.
Sec. 2582. Study, report, and termination of duplicative grant
programs.
Sec. 2583. Health centers under Public Health Service Act; liability
protections for volunteer practitioners.
Sec. 2584. Report to Congress on the current state of parasitic
diseases that have been overlooked among the poorest Americans.
Sec. 2585. Study of impact of optometrists on access to health care and
on availability of support under Federal health programs for optometry.
(b) References.--Except as otherwise specified, whenever in this
division an amendment is expressed in terms of an amendment to a
section or other provision, the reference shall be considered to be
made to a section or other provision of the Public Health Service Act
(42 U.S.C. 201 et seq.).
SEC. 2002. PUBLIC HEALTH INVESTMENT FUND.
(a) Establishment of Funds.--
(1) In general.--There is established a fund to be known as
the Public Health Investment Fund (referred to in this section
as the ``Fund'').
(2) Funding.--
(A) There shall be deposited into the Fund--
(i) for fiscal year 2010, $4,600,000,000;
(ii) for fiscal year 2011, $5,600,000,000;
(iii) for fiscal year 2012, $6,900,000,000;
(iv) for fiscal year 2013, $7,800,000,000;
and
(v) for fiscal year 2014, $9,000,000,000.
(B) Amounts deposited into the Fund shall be derived
from general revenues of the Treasury.
(b) Authorization of Appropriations From the Fund.--
(1) New funding.--
(A) In general.--Amounts in the Fund are authorized
to be appropriated by the Committees on Appropriations
of the House of Representatives and the Senate for
carrying out activities under designated public health
provisions.
(B) Designated provisions.--For purposes of this
paragraph, the term ``designated public health
provisions'' means the provisions for which amounts are
authorized to be appropriated under section 330(s),
338(c), 338H-1, 799C, 872, or 3111 of the Public Health
Service Act, as added by this division.
(2) Baseline funding.--
(A) In general.--Amounts in the Fund are authorized
to be appropriated (as described in paragraph (1)) for
a fiscal year only if (excluding any amounts in or
appropriated from the Fund)--
(i) the amounts specified in subparagraph (B)
for the fiscal year involved are equal to or
greater than the amounts specified in
subparagraph (B) for fiscal year 2008; and
(ii) the amounts appropriated, out of the
general fund of the Treasury, to the Prevention
and Wellness Trust under section 3111 of the
Public Health Service Act, as added by this
division, for the fiscal year involved are
equal to or greater than the funds--
(I) appropriated under the heading
``Prevention and Wellness Fund'' in
title VIII of division A of the
American Recovery and Reinvestment Act
of 2009 (Public Law 111-5); and
(II) allocated by the second proviso
under such heading for evidence-based
clinical and community-based prevention
and wellness strategies.
(B) Amounts specified.--The amounts specified in this
subparagraph, with respect to a fiscal year, are the
amounts appropriated for the following:
(i) Community health centers (including funds
appropriated under the authority of section 330
of the Public Health Service Act (42 U.S.C.
254b)).
(ii) The National Health Service Corps
Program (including funds appropriated under the
authority of section 338 of such Act (42 U.S.C.
254k)).
(iii) The National Health Service Corps
Scholarship and Loan Repayment Programs
(including funds appropriated under the
authority of section 338H of such Act (42
U.S.C. 254q)).
(iv) Primary care education programs
(including funds appropriated under the
authority of sections 736, 740, 741, and 747 of
such Act (42 U.S.C. 293, 293d, and 293k)).
(v) Sections 761 and 770 of such Act (42
U.S.C. 294n and 295e).
(vi) Nursing workforce development (including
funds appropriated under the authority of title
VIII of such Act (42 U.S.C. 296 et seq.)).
(vii) The National Center for Health
Statistics (including funds appropriated under
the authority of sections 304, 306, 307, and
308 of such Act (42 U.S.C. 242b, 242k, 242l,
and 242m)).
(viii) The Agency for Healthcare Research and
Quality (including funds appropriated under the
authority of title IX of such Act (42 U.S.C.
299 et seq.)).
(3) Budgetary implications.--Amounts appropriated under this
section, and outlays flowing from such appropriations, shall
not be taken into account for purposes of any budget
enforcement procedures including allocations under section
302(a) and (b) of the Balanced Budget and Emergency Deficit
Control Act and budget resolutions for fiscal years during
which appropriations are made from the Fund.
TITLE I--COMMUNITY HEALTH CENTERS
SEC. 2101. INCREASED FUNDING.
Section 330 of the Public Health Service Act (42 U.S.C. 254b) is
amended--
(1) in subsection (r)(1)--
(A) in subparagraph (D), by striking ``and'' at the
end;
(B) in subparagraph (E), by striking the period at
the end and inserting ``; and''; and
(C) by inserting at the end the following:
``(F) such sums as may be necessary for each of
fiscal years 2013 and 2014.''; and
(2) by inserting after subsection (r) the following:
``(s) Additional Funding.--For the purpose of carrying out this
section, in addition to any other amounts authorized to be appropriated
for such purpose, there are authorized to be appropriated, out of any
monies in the Public Health Investment Fund, the following:
``(1) For fiscal year 2010, $1,000,000,000.
``(2) For fiscal year 2011, $1,500,000,000.
``(3) For fiscal year 2012, $2,500,000,000.
``(4) For fiscal year 2013, $3,000,000,000.
``(5) For fiscal year 2014, $4,000,000,000.''.
TITLE II--WORKFORCE
Subtitle A--Primary Care Workforce
PART 1--NATIONAL HEALTH SERVICE CORPS
SEC. 2201. NATIONAL HEALTH SERVICE CORPS.
(a) Fulfillment of Obligated Service Requirement Through Half-Time
Service.--
(1) Waivers.--Subsection (i) of section 331 (42 U.S.C. 254d)
is amended--
(A) in paragraph (1), by striking ``In carrying out
subpart III'' and all that follows through the period
and inserting ``In carrying out subpart III, the
Secretary may, in accordance with this subsection,
issue waivers to individuals who have entered into a
contract for obligated service under the Scholarship
Program or the Loan Repayment Program under which the
individuals are authorized to satisfy the requirement
of obligated service through providing clinical
practice that is half-time.'';
(B) in paragraph (2)--
(i) in subparagraphs (A)(ii) and (B), by
striking ``less than full time'' each place it
appears and inserting ``half time'';
(ii) in subparagraphs (C) and (F), by
striking ``less than full-time service'' each
place it appears and inserting ``half-time
service''; and
(iii) by amending subparagraphs (D) and (E)
to read as follows:
``(D) the entity and the Corps member agree in writing that
the Corps member will perform half-time clinical practice;
``(E) the Corps member agrees in writing to fulfill all of
the service obligations under section 338C through half-time
clinical practice and either--
``(i) double the period of obligated service that
would otherwise be required; or
``(ii) in the case of contracts entered into under
section 338B, accept a minimum service obligation of 2
years with an award amount equal to 50 percent of the
amount that would otherwise be payable for full-time
service; and''; and
(C) in paragraph (3), by striking ``In evaluating a
demonstration project described in paragraph (1)'' and
inserting ``In evaluating waivers issued under
paragraph (1)''.
(2) Definitions.--Subsection (j) of section 331 (42 U.S.C.
254d) is amended by adding at the end the following:
``(5) The terms `full time' and `full-time' mean a minimum of
40 hours per week in a clinical practice, for a minimum of 45
weeks per year.
``(6) The terms `half time' and `half-time' mean a minimum of
20 hours per week (not to exceed 39 hours per week) in a
clinical practice, for a minimum of 45 weeks per year.''.
(b) Reappointment to National Advisory Council.--Section 337(b)(1)
(42 U.S.C. 254j(b)(1)) is amended by striking ``Members may not be
reappointed to the Council.''.
(c) Loan Repayment Amount.--Section 338B(g)(2)(A) (42 U.S.C. 254l-
1(g)(2)(A)) is amended by striking ``$35,000'' and inserting ``$50,000,
plus, beginning with fiscal year 2012, an amount determined by the
Secretary on an annual basis to reflect inflation,''.
(d) Treatment of Teaching as Obligated Service.--Subsection (a) of
section 338C (42 U.S.C. 254m) is amended by adding at the end the
following: ``The Secretary may treat teaching as clinical practice for
up to 20 percent of such period of obligated service.''.
SEC. 2202. AUTHORIZATIONS OF APPROPRIATIONS.
(a) National Health Service Corps Program.--Section 338 (42 U.S.C.
254k) is amended--
(1) in subsection (a), by striking ``2012'' and inserting
``2014''; and
(2) by adding at the end the following:
``(c) For the purpose of carrying out this subpart, in addition to
any other amounts authorized to be appropriated for such purpose, there
are authorized to be appropriated, out of any monies in the Public
Health Investment Fund, the following:
``(1) $63,000,000 for fiscal year 2010.
``(2) $66,000,000 for fiscal year 2011.
``(3) $70,000,000 for fiscal year 2012.
``(4) $73,000,000 for fiscal year 2013.
``(5) $77,000,000 for fiscal year 2014.''.
(b) Scholarship and Loan Repayment Programs.--Subpart III of part D
of title III of the Public Health Service Act (42 U.S.C. 254l et seq.)
is amended--
(1) in section 338H(a)--
(A) in paragraph (4), by striking ``and'' at the end;
(B) in paragraph (5), by striking the period at the
end and inserting ``; and''; and
(C) by adding at the end the following:
``(6) for fiscal years 2013 and 2014, such sums as may be
necessary.''; and
(2) by inserting after section 338H the following:
``SEC. 338H-1. ADDITIONAL FUNDING.
``For the purpose of carrying out this subpart, in addition to any
other amounts authorized to be appropriated for such purpose, there are
authorized to be appropriated, out of any monies in the Public Health
Investment Fund, the following:
``(1) $254,000,000 for fiscal year 2010.
``(2) $266,000,000 for fiscal year 2011.
``(3) $278,000,000 for fiscal year 2012.
``(4) $292,000,000 for fiscal year 2013.
``(5) $306,000,000 for fiscal year 2014.''.
PART 2--PROMOTION OF PRIMARY CARE AND DENTISTRY
SEC. 2211. FRONTLINE HEALTH PROVIDERS.
Part D of title III (42 U.S.C. 254b et seq.) is amended by adding at
the end the following:
``Subpart XI--Health Professional Needs Areas
``SEC. 340H. IN GENERAL.
``(a) Program.--The Secretary, acting through the Administrator of
the Health Resources and Services Administration, shall establish a
program, to be known as the Frontline Health Providers Loan Repayment
Program, to address unmet health care needs in health professional
needs areas through loan repayments under section 340I.
``(b) Designation of Health Professional Needs Areas.--
``(1) In general.--In this subpart, the term `health
professional needs area' means an area, population, or facility
that is designated by the Secretary in accordance with
paragraph (2).
``(2) Designation.--To be designated by the Secretary as a
health professional needs area under this subpart:
``(A) In the case of an area, the area must be a
rational area for the delivery of health services.
``(B) The area, population, or facility must have, in
one or more health disciplines, specialties, or
subspecialties for the population served, as determined
by the Secretary--
``(i) insufficient capacity of health
professionals; or
``(ii) high needs for health services,
including services to address health
disparities.
``(C) With respect to the delivery of primary health
services, the area, population, or facility must not
include a health professional shortage area (as
designated under section 332), except that the area,
population, or facility may include such a health
professional shortage area in which there is an unmet
need for such services.
``(c) Eligibility.--To be eligible to participate in the Program, an
individual shall--
``(1) hold a degree in a course of study or program (approved
by the Secretary) from a school defined in section 799B(1)(A)
(other than a school of public health);
``(2) hold a degree in a course of study or program (approved
by the Secretary) from a school or program defined in
subparagraph (C), (D), or (E)(4) of section 799B(1), as
designated by the Secretary;
``(3) be enrolled as a full-time student--
``(A) in a school or program defined in subparagraph
(C), (D), or (E)(4) of section 799B(1), as designated
by the Secretary, or a school described in paragraph
(1); and
``(B) in the final year of a course of study or
program, offered by such school or program and approved
by the Secretary, leading to a degree in a discipline
referred to in subparagraph (A) (other than a graduate
degree in public health), (C), (D), or (E)(4) of
section 799B(1);
``(4) be a practitioner described in section 1842(b)(18)(C)
or 1848(k)(3)(B)(iii) or (iv) of the Social Security Act; or
``(5) be a practitioner in the field of respiratory therapy,
medical technology, or radiologic technology.
``(d) Definitions.--In this subpart:
``(1) The term `health disparities' has the meaning given to
the term in section 3171.
``(2) The term `primary health services' has the meaning
given to such term in section 331(a)(3)(D).
``SEC. 340I. LOAN REPAYMENTS.
``(a) Loan Repayments.--The Secretary, acting through the
Administrator of the Health Resources and Services Administration,
shall enter into contracts with individuals under which--
``(1) the individual agrees--
``(A) to serve as a full-time primary health services
provider or as a full-time or part-time provider of
other health services for a period of time equal to 2
years or such longer period as the individual may agree
to;
``(B) to serve in a health professional needs area in
a health discipline, specialty, or a subspecialty for
which the area, population, or facility is designated
as a health professional needs area under section 340H;
and
``(C) in the case of an individual described in
section 340H(c)(3) who is in the final year of study
and who has accepted employment as a primary health
services provider or provider of other health services
in accordance with subparagraphs (A) and (B), to
complete the education or training and maintain an
acceptable level of academic standing (as determined by
the educational institution offering the course of
study or training); and
``(2) the Secretary agrees to pay, for each year of such
service, an amount on the principal and interest of the
undergraduate or graduate educational loans (or both) of the
individual that is not more than 50 percent of the average
award made under the National Health Service Corps Loan
Repayment Program under subpart III in that year.
``(b) Practice Setting.--A contract entered into under this section
shall allow the individual receiving the loan repayment to satisfy the
service requirement described in subsection (a)(1) through employment
in a solo or group practice, a clinic, an accredited public or private
nonprofit hospital, or any other health care entity, as deemed
appropriate by the Secretary.
``(c) Application of Certain Provisions.--The provisions of subpart
III of part D shall, except as inconsistent with this section, apply to
the loan repayment program under this subpart in the same manner and to
the same extent as such provisions apply to the National Health Service
Corps Loan Repayment Program established under section 338B.
``(d) Insufficient Number of Applicants.--If there are an
insufficient number of applicants for loan repayments under this
section to obligate all appropriated funds, the Secretary shall
transfer the unobligated funds to the National Health Service Corps for
the purpose of recruiting applicants and entering into contracts with
individuals so as to ensure a sufficient number of participants in the
National Health Service Corps for the following year.
``SEC. 340J. REPORT.
``The Secretary shall submit to the Congress an annual report on the
program carried out under this subpart.
``SEC. 340K. ALLOCATION.
``Of the amount of funds obligated under this subpart each fiscal
year for loan repayments--
``(1) 90 percent shall be for physicians and other health
professionals providing primary health services; and
``(2) 10 percent shall be for health professionals not
described in paragraph (1).''.
SEC. 2212. PRIMARY CARE STUDENT LOAN FUNDS.
(a) In General.--Section 735 (42 U.S.C. 292y) is amended--
(1) by redesignating subsection (f) as subsection (g); and
(2) by inserting after subsection (e) the following:
``(f) Determination of Financial Need.--The Secretary--
``(1) may require, or authorize a school or other entity to
require, the submission of financial information to determine
the financial resources available to any individual seeking
assistance under this subpart; and
``(2) shall take into account the extent to which such
individual is financially independent in determining whether to
require or authorize the submission of such information
regarding such individual's family members.''.
(b) Revised Guidelines.--The Secretary of Health and Human Services
shall--
(1) strike the second sentence of section 57.206(b) of title
42, Code of Federal Regulations; and
(2) make such other revisions to guidelines and regulations
in effect as of the date of the enactment of this Act as may be
necessary for consistency with the amendments made by paragraph
(1).
SEC. 2213. TRAINING IN FAMILY MEDICINE, GENERAL INTERNAL MEDICINE,
GENERAL PEDIATRICS, GERIATRICS, AND PHYSICIAN
ASSISTANTS.
Section 747 (42 U.S.C. 293k) is amended--
(1) by amending the section heading to read as follows:
``PRIMARY CARE TRAINING AND ENHANCEMENT'';
(2) by redesignating subsection (e) as subsection (g); and
(3) by striking subsections (a) through (d) and inserting the
following:
``(a) Program.--The Secretary shall establish a primary care training
and capacity building program consisting of awarding grants and
contracts under subsections (b) and (c).
``(b) Support and Development of Primary Care Training Programs.--
``(1) In general.--The Secretary shall make grants to, or
enter into contracts with, eligible entities--
``(A) to plan, develop, operate, or participate in an
accredited professional training program, including an
accredited residency or internship program, in the
field of family medicine, general internal medicine,
general pediatrics, or geriatrics for medical students,
interns, residents, or practicing physicians;
``(B) to provide financial assistance in the form of
traineeships and fellowships to medical students,
interns, residents, or practicing physicians, who are
participants in any such program, and who plan to
specialize or work in family medicine, general internal
medicine, general pediatrics, or geriatrics;
``(C) to plan, develop, operate, or participate in an
accredited program for the training of physicians who
plan to teach in family medicine, general internal
medicine, general pediatrics, or geriatrics training
programs including in community-based settings;
``(D) to provide financial assistance in the form of
traineeships and fellowships to practicing physicians
who are participants in any such programs and who plan
to teach in a family medicine, general internal
medicine, general pediatrics, or geriatrics training
program; and
``(E) to plan, develop, operate, or participate in an
accredited program for physician assistant education,
and for the training of individuals who plan to teach
in programs to provide such training.
``(2) Eligibility.--To be eligible for a grant or contract
under paragraph (1), an entity shall be--
``(A) an accredited school of medicine or osteopathic
medicine, public or nonprofit private hospital, or
physician assistant training program;
``(B) a public or private nonprofit entity; or
``(C) a consortium of 2 or more entities described in
subparagraphs (A) and (B).
``(c) Capacity Building in Primary Care.--
``(1) In general.--The Secretary shall make grants to or
enter into contracts with eligible entities to establish,
maintain, or improve--
``(A) academic administrative units (including
departments, divisions, or other appropriate units) in
the specialties of family medicine, general internal
medicine, general pediatrics, or geriatrics; or
``(B) programs that improve clinical teaching in such
specialties.
``(2) Eligibility.--To be eligible for a grant or contract
under paragraph (1), an entity shall be an accredited school of
medicine or osteopathic medicine.
``(d) Preference.--In awarding grants or contracts under this
section, the Secretary shall give preference to entities that have a
demonstrated record of the following:
``(1) Training the greatest percentage, or significantly
improving the percentage, of health professionals who provide
primary care.
``(2) Training individuals who are from underrepresented
minority groups or disadvantaged backgrounds.
``(3) A high rate of placing graduates in practice settings
having the principal focus of serving in underserved areas or
populations experiencing health disparities (including serving
patients eligible for medical assistance under title XIX of the
Social Security Act or for child health assistance under title
XXI of such Act or those with special health care needs).
``(4) Supporting teaching programs that address the health
care needs of vulnerable populations.
``(e) Report.--The Secretary shall submit to the Congress an annual
report on the program carried out under this section.
``(f) Definition.--In this section, the term `health disparities' has
the meaning given the term in section 3171.''.
SEC. 2214. TRAINING OF MEDICAL RESIDENTS IN COMMUNITY-BASED SETTINGS.
Title VII (42 U.S.C. 292 et seq.) is amended--
(1) by redesignating section 748 as 749A; and
(2) by inserting after section 747 the following:
``SEC. 748. TRAINING OF MEDICAL RESIDENTS IN COMMUNITY-BASED SETTINGS.
``(a) Program.--The Secretary shall establish a program for the
training of medical residents in community-based settings consisting of
awarding grants and contracts under this section.
``(b) Development and Operation of Community-Based Programs.--The
Secretary shall make grants to, or enter into contracts with, eligible
entities--
``(1) to plan and develop a new primary care residency
training program, which may include--
``(A) planning and developing curricula;
``(B) recruiting and training residents and faculty;
and
``(C) other activities designated to result in
accreditation of such a program; or
``(2) to operate or participate in an established primary
care residency training program, which may include--
``(A) planning and developing curricula;
``(B) recruitment and training of residents; and
``(C) retention of faculty.
``(c) Eligible Entity.--To be eligible to receive a grant or contract
under subsection (b), an entity shall--
``(1) be designated as a recipient of payment for the direct
costs of medical education under section 1886(k) of the Social
Security Act;
``(2) be designated as an approved teaching health center
under section 1502(d) of the America's Affordable Health
Choices Act of 2009 and continuing to participate in the
demonstration project under such section; or
``(3) be an applicant for designation described in paragraph
(1) or (2) and have demonstrated to the Secretary appropriate
involvement of an accredited teaching hospital to carry out the
inpatient responsibilities associated with a primary care
residency training program.
``(d) Preferences.--In awarding grants and contracts under paragraph
(1) or (2) of subsection (b), the Secretary shall give preference to
entities that--
``(1) support teaching programs that address the health care
needs of vulnerable populations; or
``(2) are a Federally qualified health center (as defined in
section 1861(aa)(4) of the Social Security Act) or a rural
health clinic (as defined in section 1861(aa)(2) of such Act).
``(e) Additional Preferences for Established Programs.--In awarding
grants and contracts under subsection (b)(2), the Secretary shall give
preference to entities that have a demonstrated record of training--
``(1) a high or significantly improved percentage of health
professionals who provide primary care;
``(2) individuals who are from underrepresented minority
groups or disadvantaged backgrounds; or
``(3) individuals who practice in settings having the
principal focus of serving underserved areas or populations
experiencing health disparities (including serving patients
eligible for medical assistance under title XIX of the Social
Security Act or for child health assistance under title XXI of
such Act or those with special health care needs).
``(f) Period of Awards.--
``(1) In general.--The period of a grant or contract under
this section--
``(A) shall not exceed 3 years for awards under
subsection (b)(1); and
``(B) shall not exceed 5 years for awards under
subsection (b)(2).
``(2) Special rules.--
``(A) An award of a grant or contract under
subsection (b)(1) shall not be renewed.
``(B) The period of a grant or contract awarded to an
entity under subsection (b)(2) shall not overlap with
the period of any grant or contact awarded to the same
entity under subsection (b)(1).
``(g) Report.--The Secretary shall submit to the Congress an annual
report on the program carried out under this section.
``(h) Definitions.--In this section:
``(1) Health disparities.--The term `health disparities' has
the meaning given the term in section 3171.
``(2) Primary care resident.--The term `primary care
resident' has the meaning given the term in section
1886(h)(5)(H) of the Social Security Act.
``(3) Primary care residency training program.--The term
`primary care residency training program' means an approved
medical residency training program described in section
1886(h)(5)(A) of the Social Security Act for primary care
residents that is--
``(A) in the case of entities seeking awards under
subsection (b)(1), actively applying to be accredited
by the Accreditation Council for Graduate Medical
Education or the American Osteopathic Association; or
``(B) in the case of entities seeking awards under
subsection (b)(2), so accredited.''.
SEC. 2215. TRAINING FOR GENERAL, PEDIATRIC, AND PUBLIC HEALTH DENTISTS
AND DENTAL HYGIENISTS.
Title VII (42 U.S.C. 292 et seq.) is amended--
(1) in section 791(a)(1), by striking ``747 and 750'' and
inserting ``747, 749, and 750''; and
(2) by inserting after section 748, as added, the following:
``SEC. 749. TRAINING FOR GENERAL, PEDIATRIC, AND PUBLIC HEALTH DENTISTS
AND DENTAL HYGIENISTS.
``(a) Program.--The Secretary shall establish a training program for
oral professionals consisting of awarding grants and contracts under
this section.
``(b) Support and Development of Dental Training Programs.--The
Secretary shall make grants to, or enter into contracts with, eligible
entities--
``(1) to plan, develop, operate, or participate in an
accredited professional training program for oral health
professionals;
``(2) to provide financial assistance to oral health
professionals who are in need thereof, who are participants in
any such program, and who plan to work in general, pediatric,
or public health dentistry, or dental hygiene;
``(3) to plan, develop, operate, or participate in a program
for the training of oral health professionals who plan to teach
in general, pediatric, or public health dentistry, or dental
hygiene;
``(4) to provide financial assistance in the form of
traineeships and fellowships to oral health professionals who
plan to teach in general, pediatric, or public health dentistry
or dental hygiene;
``(5) to establish, maintain, or improve--
``(A) academic administrative units (including
departments, divisions, or other appropriate units) in
the specialties of general, pediatric, or public health
dentistry; or
``(B) programs that improve clinical teaching in such
specialties;
``(6) to plan, develop, operate, or participate in
predoctoral and postdoctoral training in general, pediatric, or
public health dentistry programs;
``(7) to plan, develop, operate, or participate in a loan
repayment program for full-time faculty in a program of
general, pediatric, or public health dentistry; and
``(8) to provide technical assistance to pediatric dental
training programs in developing and implementing instruction
regarding the oral health status, dental care needs, and risk-
based clinical disease management of all pediatric populations
with an emphasis on underserved children.
``(c) Eligibility.--To be eligible for a grant or contract under
subsection (a), an entity shall be--
``(1) an accredited school of dentistry, training program in
dental hygiene, or public or nonprofit private hospital;
``(2) a training program in dental hygiene at an accredited
institution of higher education;
``(3) a public or private nonprofit entity; or
``(4) a consortium of--
``(A) 1 or more of the entities described in
paragraphs (1) through (3); and
``(B) an accredited school of public health.
``(d) Preference.--In awarding grants or contracts under this
section, the Secretary shall give preference to entities that have a
demonstrated record of the following:
``(1) Training the greatest percentage, or significantly
improving the percentage, of oral health professionals who
practice general, pediatric, or public health dentistry.
``(2) Training individuals who are from underrepresented
minority groups or disadvantaged backgrounds.
``(3) A high rate of placing graduates in practice settings
having the principal focus of serving in underserved areas or
populations experiencing health disparities (including serving
patients eligible for medical assistance under title XIX of the
Social Security Act or for child health assistance under title
XXI of such Act or those with special health care needs).
``(4) Supporting teaching programs that address the dental
needs of vulnerable populations.
``(5) Providing instruction regarding the oral health status,
dental care needs, and risk-based clinical disease management
of all pediatric populations with an emphasis on underserved
children.
``(e) Report.--The Secretary shall submit to the Congress an annual
report on the program carried out under this section.
``(f) Definitions.--In this section:
``(1) The term `health disparities' has the meaning given the
term in section 3171.
``(2) The term `oral health professional' means an individual
training or practicing--
``(A) in general dentistry, pediatric dentistry,
public health dentistry, or dental hygiene; or
``(B) another oral health specialty, as deemed
appropriate by the Secretary.''.
SEC. 2216. AUTHORIZATION OF APPROPRIATIONS.
(a) In General.--Part F of title VII (42 U.S.C. 295j et seq.) is
amended by adding at the end the following:
``SEC. 799C. FUNDING THROUGH PUBLIC HEALTH INVESTMENT FUND.
``(a) Promotion of Primary Care and Dentistry.--For the purpose of
carrying out subpart XI of part D of title III and sections 747, 748,
and 749, in addition to any other amounts authorized to be appropriated
for such purpose, there are authorized to be appropriated, out of any
monies in the Public Health Investment Fund, the following:
``(1) $240,000,000 for fiscal year 2010.
``(2) $253,000,000 for fiscal year 2011.
``(3) $265,000,000 for fiscal year 2012.
``(4) $278,000,000 for fiscal year 2013.
``(5) $292,000,000 for fiscal year 2014.''.
(b) Existing Authorization of Appropriations.--Subsection (g), as so
redesignated, of section 747 (42 U.S.C. 293k) is amended by striking
``2002'' and inserting ``2014''.
SEC. 2217. STUDY ON EFFECTIVENESS OF SCHOLARSHIPS AND LOAN REPAYMENTS.
Not later than 18 months after the date of the enactment of this Act,
the Comptroller General of the United States shall conduct a study to
determine the effectiveness of scholarship and loan repayment programs
under subparts III and XI of part D of title III of the Public Health
Service Act, as amended or added by sections 2201 and 2211, including
whether scholarships or loan repayments are more effective in--
(1) incentivizing physicians, and other providers, to pursue
careers in primary care specialties;
(2) retaining such primary care providers; and
(3) encouraging such primary care providers to practice in
underserved areas.
Subtitle B--Nursing Workforce
SEC. 2221. AMENDMENTS TO PUBLIC HEALTH SERVICE ACT.
(a) Definitions.--Section 801 (42 U.S.C. 296 et seq.) is amended--
(1) in paragraph (1), by inserting ``nurse-managed health
centers,'' after ``nursing centers,''; and
(2) by adding at the end the following:
``(16) Nurse-managed health center.--The term `nurse-managed
health center' means a nurse-practice arrangement, managed by
advanced practice nurses, that provides primary care or
wellness services to underserved or vulnerable populations and
is associated with an accredited school of nursing, Federally
qualified health center, or independent nonprofit health or
social services agency.''.
(b) Grants for Health Professions Education.--Title VIII (42 U.S.C.
296 et seq.) is amended by striking section 807.
(c) Reports.--Part A of title VIII (42 U.S.C. 296 et seq.) is amended
by adding at the end the following:
``SEC. 809. REPORTS.
``The Secretary shall submit to the Congress a separate annual report
on the activities carried out under each of sections 811, 821, 836,
846A, and 861.''.
(d) Advanced Education Nursing Grants.--Section 811(f) (42 U.S.C.
296j(f)) is amended--
(1) by striking paragraph (2);
(2) by redesignating paragraph (3) as paragraph (2); and
(3) in paragraph (2), as so redesignated, by striking ``that
agrees'' and all that follows through the end and inserting:
``that agrees to expend the award--
``(A) to train advanced education nurses who will
practice in health professional shortage areas
designated under section 332; or
``(B) to increase diversity among advanced education
nurses.''.
(e) Nurse Education, Practice, and Retention Grants.--Section 831 (42
U.S.C. 296p) is amended--
(1) in subsection (b), by amending paragraph (3) to read as
follows:
``(3) providing coordinated care, quality care, and other
skills needed to practice nursing; or''; and
(2) by striking subsection (e) and redesignating subsections
(f) through (h) as subsections (e) through (g), respectively.
(f) Student Loans.--Subsection (a) of section 836 (42 U.S.C. 297b) is
amended--
(1) by striking ``$2,500'' and inserting ``$3,300'';
(2) by striking ``$4,000'' and inserting ``$5,200'';
(3) by striking ``$13,000'' and inserting ``$17,000''; and
(4) by adding at the end the following: ``Beginning with
fiscal year 2012, the dollar amounts specified in this
subsection shall be adjusted by an amount determined by the
Secretary on an annual basis to reflect inflation.''.
(g) Loan Repayment.--Section 846 (42 U.S.C. 297n) is amended--
(1) in subsection (a), by amending paragraph (3) to read as
follows:
``(3) who enters into an agreement with the Secretary to
serve for a period of not less than 2 years--
``(A) as a nurse at a health care facility with a
critical shortage of nurses; or
``(B) as a faculty member at an accredited school of
nursing;''; and
(2) in subsection (g)(1), by striking ``to provide health
services'' each place it appears and inserting ``to provide
health services or serve as a faculty member''.
(h) Nurse Faculty Loan Program.--Paragraph (2) of section 846A(c) (42
U.S.C. 297n-1(c)) is amended by striking ``$30,000'' and all that
follows through the semicolon and inserting ``$35,000, plus, beginning
with fiscal year 2012, an amount determined by the Secretary on an
annual basis to reflect inflation;''.
(i) Public Service Announcements.--Title VIII (42 U.S.C. 296 et seq.)
is amended by striking part H.
(j) Technical and Conforming Amendments.--Title VIII (42 U.S.C. 296
et seq.) is amended--
(1) by moving section 810 (relating to prohibition against
discrimination by schools on the basis of sex) so that it
follows section 809, as added by subsection (c);
(2) in sections 835, 836, 838, 840, and 842, by striking the
term ``this subpart'' each place it appears and inserting
``this part'';
(3) in section 836(h), by striking the last sentence;
(4) in section 836, by redesignating subsection (l) as
subsection (k);
(5) in section 839, by striking ``839'' and all that follows
through ``(a)'' and inserting ``839. (a)'';
(6) in section 835(b), by striking ``841'' each place it
appears and inserting ``871'';
(7) by redesignating section 841 as section 871, moving part
F to the end of the title, and redesignating such part as part
H;
(8) in part G--
(A) by redesignating section 845 as section 851; and
(B) by redesignating part G as part F; and
(9) in part I--
(A) by redesignating section 855 as section 861; and
(B) by redesignating part I as part G.
(k) Funding.--
(1) In general.--Part H, as redesignated, of title VIII is
amended by adding at the end the following:
``SEC. 872. FUNDING THROUGH PUBLIC HEALTH INVESTMENT FUND.
``For the purpose of carrying out this title, in addition to any
other amounts authorized to be appropriated for such purpose, there are
authorized to be appropriated, out of any monies in the Public Health
Investment Fund, the following:
``(1) $115,000,000 for fiscal year 2010.
``(2) $122,000,000 for fiscal year 2011.
``(3) $127,000,000 for fiscal year 2012.
``(4) $134,000,000 for fiscal year 2013.
``(5) $140,000,000 for fiscal year 2014.''.
(2) Existing authorizations of appropriations.--
(A) Sections 831, 846, 846a, and 861.--Sections
831(g) (as so redesignated), 846(i)(1) (42 U.S.C.
297n(i)(1)), 846A(f) (42 U.S.C. 297n-1(f)), and 861(e)
(as so redesignated) are amended by striking ``2007''
each place it appears and inserting ``2014''.
(B) Section 871.--Section 871, as so redesignated by
subsection (j), is amended to read as follows:
``SEC. 871. FUNDING.
``For the purpose of carrying out parts B, C, and D (subject to
section 845(g)), there are authorized to be appropriated such sums as
may be necessary for each fiscal year through fiscal year 2014.''.
Subtitle C--Public Health Workforce
SEC. 2231. PUBLIC HEALTH WORKFORCE CORPS.
Part D of title III (42 U.S.C. 254b et seq.), as amended by section
2211, is amended by adding at the end the following:
``Subpart XII--Public Health Workforce
``SEC. 340L. PUBLIC HEALTH WORKFORCE CORPS.
``(a) Establishment.--There is established, within the Service, the
Public Health Workforce Corps (in this subpart referred to as the
`Corps'), for the purpose of ensuring an adequate supply of public
health professionals throughout the Nation. The Corps shall consist
of--
``(1) such officers of the Regular and Reserve Corps of the
Service as the Secretary may designate;
``(2) such civilian employees of the United States as the
Secretary may appoint; and
``(3) such other individuals who are not employees of the
United States.
``(b) Administration.--Except as provided in subsection (c), the
Secretary shall carry out this subpart acting through the Administrator
of the Health Resources and Services Administration.
``(c) Placement and Assignment.--The Secretary, acting through the
Director of the Centers for Disease Control and Prevention, shall
develop a methodology for placing and assigning Corps participants as
public health professionals. Such methodology may allow for placing and
assigning such participants in State, local, and tribal health
departments and Federally qualified health centers (as defined in
section 1861(aa)(4) of the Social Security Act).
``(d) Application of Certain Provisions.--The provisions of subpart
II shall, except as inconsistent with this subpart, apply to the Public
Health Workforce Corps in the same manner and to the same extent as
such provisions apply to the National Health Service Corps established
under section 331.
``(e) Report.--The Secretary shall submit to the Congress an annual
report on the programs carried out under this subpart.
``SEC. 340M. PUBLIC HEALTH WORKFORCE SCHOLARSHIP PROGRAM.
``(a) Establishment.--The Secretary shall establish the Public Health
Workforce Scholarship Program (referred to in this section as the
`Program') for the purpose described in section 340L(a).
``(b) Eligibility.--To be eligible to participate in the Program, an
individual shall--
``(1)(A) be accepted for enrollment, or be enrolled, as a
full-time or part-time student in a course of study or program
(approved by the Secretary) at an accredited graduate school or
program of public health; or
``(B) have demonstrated expertise in public health and be
accepted for enrollment, or be enrolled, as a full-time or
part-time student in a course of study or program (approved by
the Secretary) at--
``(i) an accredited graduate school or program of
nursing; health administration, management, or policy;
preventive medicine; laboratory science; veterinary
medicine; or dental medicine; or
``(ii) another accredited graduate school or program,
as deemed appropriate by Secretary;
``(2) be eligible for, or hold, an appointment as a
commissioned officer in the Regular or Reserve Corps of the
Service or be eligible for selection for civilian service in
the Corps; and
``(3) sign and submit to the Secretary a written contract
(described in subsection (c)) to serve full-time as a public
health professional, upon the completion of the course of study
or program involved, for the period of obligated service
described in subsection (c)(2)(E).
``(c) Contract.--The written contract between the Secretary and an
individual under subsection (b)(3) shall contain--
``(1) an agreement on the part of the Secretary that the
Secretary will--
``(A) provide the individual with a scholarship for a
period of years (not to exceed 4 academic years) during
which the individual shall pursue an approved course of
study or program to prepare the individual to serve in
the public health workforce; and
``(B) accept (subject to the availability of
appropriated funds) the individual into the Corps;
``(2) an agreement on the part of the individual that the
individual will--
``(A) accept provision of such scholarship to the
individual;
``(B) maintain full-time or part-time enrollment in
the approved course of study or program described in
subsection (b)(1) until the individual completes that
course of study or program;
``(C) while enrolled in the approved course of study
or program, maintain an acceptable level of academic
standing (as determined by the educational institution
offering such course of study or program);
``(D) if applicable, complete a residency or
internship; and
``(E) serve full-time as a public health professional
for a period of time equal to the greater of--
``(i) 1 year for each academic year for which
the individual was provided a scholarship under
the Program; or
``(ii) 2 years; and
``(3) an agreement by both parties as to the nature and
extent of the scholarship assistance, which may include--
``(A) payment of reasonable educational expenses of
the individual, including tuition, fees, books,
equipment, and laboratory expenses; and
``(B) payment of a stipend of not more than $1,269
(plus, beginning with fiscal year 2011, an amount
determined by the Secretary on an annual basis to
reflect inflation) per month for each month of the
academic year involved, with the dollar amount of such
a stipend determined by the Secretary taking into
consideration whether the individual is enrolled full-
time or part-time.
``(d) Application of Certain Provisions.--The provisions of subpart
III shall, except as inconsistent with this subpart, apply to the
scholarship program under this section in the same manner and to the
same extent as such provisions apply to the National Health Service
Corps Scholarship Program established under section 338A.
``SEC. 340N. PUBLIC HEALTH WORKFORCE LOAN REPAYMENT PROGRAM.
``(a) Establishment.--The Secretary shall establish the Public Health
Workforce Loan Repayment Program (referred to in this section as the
`Program') for the purpose described in section 340L(a).
``(b) Eligibility.--To be eligible to participate in the Program, an
individual shall--
``(1)(A) have a graduate degree from an accredited school or
program of public health;
``(B) have demonstrated expertise in public health and have a
graduate degree in a course of study or program (approved by
the Secretary) from--
``(i) an accredited school or program of nursing;
health administration, management, or policy;
preventive medicine; laboratory science; veterinary
medicine; or dental medicine; or
``(ii) another accredited school or program approved
by the Secretary; or
``(C) be enrolled as a full-time or part-time student in the
final year of a course of study or program (approved by the
Secretary) offered by a school or program described in
subparagraph (A) or (B), leading to a graduate degree;
``(2) be eligible for, or hold, an appointment as a
commissioned officer in the Regular or Reserve Corps of the
Service or be eligible for selection for civilian service in
the Corps;
``(3) if applicable, complete a residency or internship; and
``(4) sign and submit to the Secretary a written contract
(described in subsection (c)) to serve full-time as a public
health professional for the period of obligated service
described in subsection (c)(2).
``(c) Contract.--The written contract between the Secretary and an
individual under subsection (b)(4) shall contain--
``(1) an agreement by the Secretary to repay on behalf of the
individual loans incurred by the individual in the pursuit of
the relevant public health workforce educational degree in
accordance with the terms of the contract;
``(2) an agreement by the individual to serve full-time as a
public health professional for a period of time equal to 2
years or such longer period as the individual may agree to; and
``(3) in the case of an individual described in subsection
(b)(1)(C) who is in the final year of study and who has
accepted employment as a public health professional, in
accordance with section 340L(c), an agreement on the part of
the individual to complete the education or training, maintain
an acceptable level of academic standing (as determined by the
educational institution offering the course of study or
training), and serve the period of obligated service described
in paragraph (2).
``(d) Payments.--
``(1) In general.--A loan repayment provided for an
individual under a written contract under the Program shall
consist of payment, in accordance with paragraph (2), on behalf
of the individual of the principal, interest, and related
expenses on government and commercial loans received by the
individual regarding the undergraduate or graduate education of
the individual (or both), which loans were made for reasonable
educational expenses, including tuition, fees, books,
equipment, and laboratory expenses, incurred by the individual.
``(2) Payments for years served.--
``(A) In general.--For each year of obligated service
that an individual contracts to serve under subsection
(c), the Secretary may pay up to $35,000 (plus,
beginning with fiscal year 2012, an amount determined
by the Secretary on an annual basis to reflect
inflation) on behalf of the individual for loans
described in paragraph (1).
``(B) Repayment schedule.--Any arrangement made by
the Secretary for the making of loan repayments in
accordance with this subsection shall provide that any
repayments for a year of obligated service shall be
made no later than the end of the fiscal year in which
the individual completes such year of service.
``(e) Application of Certain Provisions.--The provisions of subpart
III shall, except as inconsistent with this subpart, apply to the loan
repayment program under this section in the same manner and to the same
extent as such provisions apply to the National Health Service Corps
Loan Repayment Program established under section 338B.''.
SEC. 2232. ENHANCING THE PUBLIC HEALTH WORKFORCE.
Section 765 (42 U.S.C. 295) is amended to read as follows:
``SEC. 765. ENHANCING THE PUBLIC HEALTH WORKFORCE.
``(a) Program.--The Secretary, acting through the Administrator of
the Health Resources and Services Administration and in consultation
with the Director of the Centers for Disease Control and Prevention,
shall establish a public health workforce training and enhancement
program consisting of awarding grants and contracts under subsection
(b).
``(b) Grants and Contracts.--The Secretary shall award grants and
contracts to eligible entities--
``(1) to plan, develop, operate, or participate in, an
accredited professional training program in the field of public
health (including such a program in nursing; health
administration, management, or policy; preventive medicine;
laboratory science; veterinary medicine; or dental medicine)
for members of the public health workforce including mid-career
professionals;
``(2) to provide financial assistance in the form of
traineeships and fellowships to students who are participants
in any such program and who plan to specialize or work in the
field of public health;
``(3) to plan, develop, operate, or participate in a program
for the training of public health professionals who plan to
teach in any program described in paragraph (1); and
``(4) to provide financial assistance in the form of
traineeships and fellowships to public health professionals who
are participants in any program described in paragraph (1) and
who plan to teach in the field of public health, including
nursing; health administration, management, or policy;
preventive medicine; laboratory science; veterinary medicine;
or dental medicine.
``(c) Eligibility.--To be eligible for a grant or contract under
subsection (a), an entity shall be--
``(1) an accredited health professions school, including an
accredited school or program of public health; nursing; health
administration, management, or policy; preventive medicine;
laboratory science; veterinary medicine; or dental medicine;
``(2) a State, local, or tribal health department;
``(3) a public or private nonprofit entity; or
``(4) a consortium of 2 or more entities described in
paragraphs (1) through (3).
``(d) Preference.--In awarding grants or contracts under this
section, the Secretary shall give preference to entities that have a
demonstrated record of the following:
``(1) Training the greatest percentage, or significantly
improving the percentage, of public health professionals who
serve in underserved communities.
``(2) Training individuals who are from underrepresented
minority groups or disadvantaged backgrounds.
``(3) Training individuals in public health specialties
experiencing a significant shortage of public health
professionals (as determined by the Secretary).
``(4) Training the greatest percentage, or significantly
improving the percentage, of public health professionals
serving in the Federal Government or a State, local, or tribal
government.
``(e) Report.--The Secretary shall submit to the Congress an annual
report on the program carried out under this section.''.
SEC. 2233. PUBLIC HEALTH TRAINING CENTERS.
Section 766 (42 U.S.C. 295a) is amended--
(1) in subsection (b)(1), by striking ``in furtherance of the
goals established by the Secretary for the year 2000'' and
inserting ``in furtherance of the goals established by the
Secretary in the national prevention and wellness strategy
under section 3121''; and
(2) by adding at the end the following:
``(d) Report.--The Secretary shall submit to the Congress an annual
report on the program carried out under this section.''.
SEC. 2234. PREVENTIVE MEDICINE AND PUBLIC HEALTH TRAINING GRANT
PROGRAM.
Section 768 (42 U.S.C. 295c) is amended to read as follows:
``SEC. 768. PREVENTIVE MEDICINE AND PUBLIC HEALTH TRAINING GRANT
PROGRAM.
``(a) Grants.--The Secretary, acting through the Administrator of the
Health Resources and Services Administration and in consultation with
the Director of the Centers for Disease Control and Prevention, shall
award grants to, or enter into contracts with, eligible entities to
provide training to graduate medical residents in preventive medicine
specialties.
``(b) Eligibility.--To be eligible for a grant or contract under
subsection (a), an entity shall be--
``(1) an accredited school of public health or school of
medicine or osteopathic medicine;
``(2) an accredited public or private hospital;
``(3) a State, local, or tribal health department; or
``(4) a consortium of 2 or more entities described in
paragraphs (1) through (3).
``(c) Use of Funds.--Amounts received under a grant or contract under
this section shall be used to--
``(1) plan, develop (including the development of curricula),
operate, or participate in an accredited residency or
internship program in preventive medicine or public health;
``(2) defray the costs of practicum experiences, as required
in such a program; and
``(3) establish, maintain, or improve--
``(A) academic administrative units (including
departments, divisions, or other appropriate units) in
preventive medicine and public health; or
``(B) programs that improve clinical teaching in
preventive medicine and public health.
``(d) Report.--The Secretary shall submit to the Congress an annual
report on the program carried out under this section.''.
SEC. 2235. AUTHORIZATION OF APPROPRIATIONS.
(a) In General.--Section 799C, as added by section 2216 of this Act,
is amended by adding at the end the following:
``(b) Public Health Workforce.--For the purpose of carrying out
subpart XII of part D of title III and sections 765, 766, and 768, in
addition to any other amounts authorized to be appropriated for such
purpose, there are authorized to be appropriated, out of any monies in
the Public Health Investment Fund, the following:
``(1) $51,000,000 for fiscal year 2010.
``(2) $54,000,000 for fiscal year 2011.
``(3) $57,000,000 for fiscal year 2012.
``(4) $59,000,000 for fiscal year 2013.
``(5) $62,000,000 for fiscal year 2014.''.
(b) Existing Authorization of Appropriations.--Subsection (a) of
section 770 (42 U.S.C. 295e) is amended by striking ``2002'' and
inserting ``2014''.
Subtitle D--Adapting Workforce to Evolving Health System Needs
PART 1--HEALTH PROFESSIONS TRAINING FOR DIVERSITY
SEC. 2241. SCHOLARSHIPS FOR DISADVANTAGED STUDENTS, LOAN REPAYMENTS AND
FELLOWSHIPS REGARDING FACULTY POSITIONS, AND
EDUCATIONAL ASSISTANCE IN THE HEALTH PROFESSIONS
REGARDING INDIVIDUALS FROM DISADVANTAGED
BACKGROUNDS.
Paragraph (1) of section 738(a) (42 U.S.C. 293b(a)) is amended by
striking ``not more than $20,000'' and all that follows through the end
of the paragraph and inserting: ``not more than $35,000 (plus,
beginning with fiscal year 2012, an amount determined by the Secretary
on an annual basis to reflect inflation) of the principal and interest
of the educational loans of such individuals.''
SEC. 2242. NURSING WORKFORCE DIVERSITY GRANTS.
Subsection (b) of section 821 (42 U.S.C. 296m) is amended--
(1) in the heading, by striking ``Guidance'' and inserting
``Consultation''; and
(2) by striking ``shall take into consideration'' and all
that follows through ``consult with nursing associations'' and
inserting ``shall, as appropriate, consult with nursing
associations''.
SEC. 2243. COORDINATION OF DIVERSITY AND CULTURAL COMPETENCY PROGRAMS.
(a) In General.--Title VII (42 U.S.C. 292 et seq.) is amended by
inserting after section 739 the following:
``SEC. 739A. COORDINATION OF DIVERSITY AND CULTURAL COMPETENCY
PROGRAMS.
``The Secretary shall, to the extent practicable, coordinate the
activities carried out under this part and section 821 in order to
enhance the effectiveness of such activities and avoid duplication of
effort.''.
(b) Report.--Section 736 (42 U.S.C. 293) is amended--
(1) by redesignating subsection (h) as subsection (i); and
(2) by inserting after subsection (g) the following:
``(h) Report.--The Secretary shall submit to the Congress an annual
report on the activities carried out under this section.''.
PART 2--INTERDISCIPLINARY TRAINING PROGRAMS
SEC. 2251. CULTURAL AND LINGUISTIC COMPETENCY TRAINING FOR HEALTH
PROFESSIONALS.
Section 741 (42 U.S.C. 293e) is amended--
(1) in the section heading, by striking ``GRANTS FOR HEALTH
PROFESSIONS EDUCATION'' and inserting ``CULTURAL AND LINGUISTIC
COMPETENCY TRAINING FOR HEALTH PROFESSIONALS'';
(2) by redesignating subsection (b) as subsection (h); and
(3) by striking subsection (a) and inserting the following:
``(a) Program.--The Secretary shall establish a cultural and
linguistic competency training program for health professionals,
including nurse professionals, consisting of awarding grants and
contracts under subsection (b).
``(b) Cultural and Linguistic Competency Training.--The Secretary
shall award grants and contracts to eligible entities--
``(1) to test, develop, and evaluate models of cultural and
linguistic competency training (including continuing education)
for health professionals; and
``(2) to implement cultural and linguistic competency
training programs for health professionals developed under
paragraph (1) or otherwise.
``(c) Eligibility.--To be eligible for a grant or contract under
subsection (b), an entity shall be--
``(1) an accredited health professions school or program;
``(2) an academic health center;
``(3) a public or private nonprofit entity; or
``(4) a consortium of 2 or more entities described in
paragraphs (1) through (3).
``(d) Preference.--In awarding grants and contracts under this
section, the Secretary shall give preference to entities that have a
demonstrated record of the following:
``(1) Addressing, or partnering with an entity with
experience addressing, the cultural and linguistic competency
needs of the population to be served through the grant or
contract.
``(2) Addressing health disparities.
``(3) Placing health professionals in regions experiencing
significant changes in the cultural and linguistic demographics
of populations, including communities along the United States-
Mexico border.
``(4) Carrying out activities described in subsection (b)
with respect to more than one health profession discipline,
specialty, or subspecialty.
``(e) Consultation.--The Secretary shall carry out this section in
consultation with the heads of appropriate health agencies and offices
in the Department of Health and Human Services, including the Office of
Minority Health.
``(f) Definition.--In this section, the term `health disparities' has
the meaning given to the term in section 3171.
``(g) Report.--The Secretary shall submit to the Congress an annual
report on the program carried out under this section.''.
SEC. 2252. INNOVATIONS IN INTERDISCIPLINARY CARE TRAINING.
Part D of title VII (42 U.S.C. 294 et seq.) is amended by adding at
the end the following:
``SEC. 759. INNOVATIONS IN INTERDISCIPLINARY CARE TRAINING.
``(a) Program.--The Secretary shall establish an innovations in
interdisciplinary care training program consisting of awarding grants
and contracts under subsection (b).
``(b) Training Programs.--The Secretary shall award grants to, or
enter into contracts with, eligible entities--
``(1) to test, develop, and evaluate health professional
training programs (including continuing education) designed to
promote--
``(A) the delivery of health services through
interdisciplinary and team-based models, which may
include patient-centered medical home models,
medication therapy management models, and models
integrating physical, mental, or oral health services;
and
``(B) coordination of the delivery of health care
within and across settings, including health care
institutions, community-based settings, and the
patient's home; and
``(2) to implement such training programs developed under
paragraph (1) or otherwise.
``(c) Eligibility.--To be eligible for a grant or contract under
subsection (b), an entity shall be--
``(1) an accredited health professions school or program;
``(2) an academic health center;
``(3) a public or private nonprofit entity (including an area
health education center or a geriatric education center); or
``(4) a consortium of 2 or more entities described in
paragraphs (1) through (3).
``(d) Preferences.--In awarding grants and contracts under this
section, the Secretary shall give preference to entities that have a
demonstrated record of the following:
``(1) Training the greatest percentage, or significantly
increasing the percentage, of health professionals who serve in
underserved communities.
``(2) Broad interdisciplinary team-based collaborations.
``(3) Addressing health disparities.
``(e) Report.--The Secretary shall submit to the Congress an annual
report on the program carried out under this section.
``(f) Definitions.--In this section:
``(1) The term `health disparities' has the meaning given the
term in section 3171.
``(2) The term `interdisciplinary' means collaboration across
health professions and specialties, which may include public
health, nursing, allied health, and appropriate medical
specialties.''.
PART 3--ADVISORY COMMITTEE ON HEALTH WORKFORCE EVALUATION AND
ASSESSMENT
SEC. 2261. HEALTH WORKFORCE EVALUATION AND ASSESSMENT.
Subpart 1 of part E of title VII (42 U.S.C. 294n et seq.) is amended
by adding at the end the following:
``SEC. 764. HEALTH WORKFORCE EVALUATION AND ASSESSMENT.
``(a) Advisory Committee.--The Secretary, acting through the
Assistant Secretary for Health, shall establish a permanent advisory
committee to be known as the Advisory Committee on Health Workforce
Evaluation and Assessment (referred to in this section as the `Advisory
Committee').
``(b) Responsibilities.--The Advisory Committee shall--
``(1) not later than 1 year after the date of the
establishment of the Advisory Committee, submit recommendations
to the Secretary on--
``(A) classifications of the health workforce to
ensure consistency of data collection on the health
workforce; and
``(B) based on such classifications, standardized
methodologies and procedures to enumerate the health
workforce;
``(2) not later than 2 years after the date of the
establishment of the Advisory Committee, submit recommendations
to the Secretary on--
``(A) the supply, diversity, and geographic
distribution of the health workforce;
``(B) the retention of the health workforce to ensure
quality and adequacy of such workforce; and
``(C) policies to carry out the recommendations made
pursuant to subparagraphs (A) and (B); and
``(3) not later than 4 years after the date of the
establishment of the Advisory Committee, and every 2 years
thereafter, submit updated recommendations to the Secretary
under paragraphs (1) and (2).
``(c) Role of Agency.--The Secretary shall provide ongoing
administrative, research, and technical support for the operations of
the Advisory Committee, including coordinating and supporting the
dissemination of the recommendations of the Advisory Committee.
``(d) Membership.--
``(1) Number; appointment.--The Secretary shall appoint 15
members to serve on the Advisory Committee.
``(2) Terms.--
``(A) In general.--The Secretary shall appoint
members of the Advisory Committee for a term of 3 years
and may reappoint such members, but the Secretary may
not appoint any member to serve more than a total of 6
years.
``(B) Staggered terms.--Notwithstanding subparagraph
(A), of the members first appointed to the Advisory
Committee under paragraph (1)--
``(i) 5 shall be appointed for a term of 1
year;
``(ii) 5 shall be appointed for a term of 2
years; and
``(iii) 5 shall be appointed for a term of 3
years.
``(3) Qualifications.--Members of the Advisory Committee
shall be appointed from among individuals who possess expertise
in at least one of the following areas:
``(A) Conducting and interpreting health workforce
market analysis, including health care labor workforce
analysis.
``(B) Conducting and interpreting health finance and
economics research.
``(C) Delivering and administering health care
services.
``(D) Delivering and administering health workforce
education and training.
``(4) Representation.--In appointing members of the Advisory
Committee, the Secretary shall--
``(A) include no less than one representative of each
of--
``(i) health professionals within the health
workforce;
``(ii) health care patients and consumers;
``(iii) employers;
``(iv) labor unions; and
``(v) third-party health payors; and
``(B) ensure that--
``(i) all areas of expertise described in
paragraph (3) are represented;
``(ii) the members of the Advisory Committee
include members who, collectively, have
significant experience working with--
``(I) populations in urban and
federally designated rural and
nonmetropolitan areas; and
``(II) populations who are
underrepresented in the health
professions, including underrepresented
minority groups; and
``(iii) individuals who are directly involved
in health professions education or practice do
not constitute a majority of the members of the
Advisory Committee.
``(5) Disclosure and conflicts of interest.--Members of the
Advisory Committee shall not be considered employees of the
Federal Government by reason of service on the Advisory
Committee, except members of the Advisory Committee shall be
considered to be special Government employees within the
meaning of section 107 of the Ethics in Government Act of 1978
(5 U.S.C. App.) and section 208 of title 18, United States
Code, for the purposes of disclosure and management of
conflicts of interest under those sections.
``(6) No pay; receipt of travel expenses.--Members of the
Advisory Committee shall not receive any pay for service on the
Committee, but may receive travel expenses, including a per
diem, in accordance with applicable provisions of subchapter I
of chapter 57 of title 5, United States Code.
``(e) Consultation.--In carrying out this section, the Secretary
shall consult with the Secretary of Education and the Secretary of
Labor.
``(f) Collaboration.--The Advisory Committee shall collaborate with
the advisory bodies at the Health Resources and Services
Administration, the National Advisory Council (as authorized in section
337), the Advisory Committee on Training in Primary Care Medicine and
Dentistry (as authorized in section 749A), the Advisory Committee on
Interdisciplinary, Community-Based Linkages (as authorized in section
756), the Advisory Council on Graduate Medical Education (as authorized
in section 762), and the National Advisory Council on Nurse Education
and Practice (as authorized in section 851).
``(g) FACA.--The Federal Advisory Committee Act (5 U.S.C. App.)
except for section 14 of such Act shall apply to the Advisory Committee
under this section only to the extent that the provisions of such Act
do not conflict with the requirements of this section.
``(h) Report.--The Secretary shall submit to the Congress an annual
report on the activities of the Advisory Committee.
``(i) Definition.--In this section, the term `health workforce'
includes all health care providers with direct patient care and support
responsibilities, including physicians, nurses, physician assistants,
pharmacists, oral health professionals (as defined in section 749(f)),
allied health professionals, mental and behavioral health
professionals, and public health professionals (including veterinarians
engaged in public health practice).''.
PART 4--HEALTH WORKFORCE ASSESSMENT
SEC. 2271. HEALTH WORKFORCE ASSESSMENT.
(a) In General.--Section 761 (42 U.S.C. 294n) is amended--
(1) by redesignating subsection (c) as subsection (e); and
(2) by striking subsections (a) and (b) and inserting the
following:
``(a) In General.--The Secretary shall, based upon the
classifications and standardized methodologies and procedures developed
by the Advisory Committee on Health Workforce Evaluation and Assessment
under section 764(b)--
``(1) collect data on the health workforce (as defined in
section 764(i)), disaggregated by field, discipline, and
specialty, with respect to--
``(A) the supply (including retention) of health
professionals relative to the demand for such
professionals;
``(B) the diversity of health professionals
(including with respect to race, ethnic background, and
gender); and
``(C) the geographic distribution of health
professionals; and
``(2) collect such data on individuals participating in the
programs authorized by subtitles A, B, and C and part 1 of
subtitle D of title II of division C of the America's
Affordable Health Choices Act of 2009.
``(b) Grants and Contracts for Health Workforce Analysis.--
``(1) In general.--The Secretary may award grants or
contracts to eligible entities to carry out subsection (a).
``(2) Eligibility.--To be eligible for a grant or contract
under this subsection, an entity shall be--
``(A) an accredited health professions school or
program;
``(B) an academic health center;
``(C) a State, local, or tribal government;
``(D) a public or private entity; or
``(E) a consortium of 2 or more entities described in
subparagraphs (A) through (D).
``(c) Collaboration and Data Sharing.--The Secretary shall
collaborate with Federal departments and agencies, health professions
organizations (including health professions education organizations),
and professional medical societies for the purpose of carrying out
subsection (a).
``(d) Report.--The Secretary shall submit to the Congress an annual
report on the data collected under subsection (a).''.
(b) Period Before Completion of National Strategy.--Pending
completion of the classifications and standardized methodologies and
procedures developed by the Advisory Committee on Health Workforce
Evaluation and Assessment under section 764(b) of the Public Health
Service Act, as added by section 2261, the Secretary of Health and
Human Services, acting through the Administrator of the Health
Resources and Services Administration and in consultation with such
Advisory Committee, may make a judgment about the classifications,
methodologies, and procedures to be used for collection of data under
section 761(a) of the Public Health Service Act, as amended by this
section.
PART 5--AUTHORIZATION OF APPROPRIATIONS
SEC. 2281. AUTHORIZATION OF APPROPRIATIONS.
(a) In General.--Section 799C, as added and amended, is further
amended by adding at the end the following:
``(c) Health Professions Training for Diversity.--For the purpose of
carrying out sections 736, 737, 738, 739, and 739A, in addition to any
other amounts authorized to be appropriated for such purpose, there are
authorized to be appropriated, out of any monies in the Public Health
Investment Fund, the following:
``(1) $90,000,000 for fiscal year 2010.
``(2) $97,000,000 for fiscal year 2011.
``(3) $100,000,000 for fiscal year 2012.
``(4) $104,000,000 for fiscal year 2013.
``(5) $110,000,000 for fiscal year 2014.
``(d) Interdisciplinary Training Programs, Advisory Committee on
Health Workforce Evaluation and Assessment, and Health Workforce
Assessment.--For the purpose of carrying out sections 741, 759, 761,
and 764, in addition to any other amounts authorized to be appropriated
for such purpose, there are authorized to be appropriated, out of any
monies in the Public Health Investment Fund, the following:
``(1) $87,000,000 for fiscal year 2010.
``(2) $97,000,000 for fiscal year 2011.
``(3) $103,000,000 for fiscal year 2012.
``(4) $105,000,000 for fiscal year 2013.
``(5) $113,000,000 for fiscal year 2014.''.
(b) Existing Authorizations of Appropriations.--
(1) Section 736.--Paragraph (1) of section 736(i) (42 U.S.C.
293(h)), as redesignated, is amended by striking ``2002'' and
inserting ``2014''.
(2) Sections 737, 738, and 739.--Subsections (a), (b), and
(c) of section 740 are amended by striking ``2002'' each place
it appears and inserting ``2014''.
(3) Section 741.--Subsection (h), as so redesignated, of
section 741 is amended--
(A) by striking ``and'' after ``fiscal year 2003,'';
and
(B) by inserting ``, and such sums as may be
necessary for subsequent fiscal years through the end
of fiscal year 2014'' before the period at the end.
(4) Section 761.--Subsection (e)(1), as so redesignated, of
section 761 is amended by striking ``2002'' and inserting
``2014''.
TITLE III--PREVENTION AND WELLNESS
SEC. 2301. PREVENTION AND WELLNESS.
(a) In General.--The Public Health Service Act (42 U.S.C. 201 et
seq.) is amended by adding at the end the following:
``TITLE XXXI--PREVENTION AND WELLNESS
``Subtitle A--Prevention and Wellness Trust
``SEC. 3111. PREVENTION AND WELLNESS TRUST.
``(a) Deposits Into Trust.--There is established a Prevention and
Wellness Trust. There are authorized to be appropriated to the Trust--
``(1) amounts described in section 2002(b)(2)(A)(ii) of the
America's Affordable Health Choices Act of 2009 for each fiscal
year; and
``(2) in addition, out of any monies in the Public Health
Investment Fund--
``(A) for fiscal year 2010, $2,400,000,000;
``(B) for fiscal year 2011, $2,845,000,000;
``(C) for fiscal year 2012, $3,100,000,000;
``(D) for fiscal year 2013, $3,455,000,000; and
``(E) for fiscal year 2014, $3,600,000,000.
``(b) Availability of Funds.--Amounts in the Prevention and Wellness
Trust shall be available, as provided in advance in appropriation Acts,
for carrying out this title.
``(c) Allocation.--Of the amounts authorized to be appropriated in
subsection (a)(2), there are authorized to be appropriated--
``(1) for carrying out subtitle C (Prevention Task Forces),
$30,000,000 for each of fiscal years 2010 through 2014;
``(2) for carrying out subtitle D (Prevention and Wellness
Research)--
``(A) for fiscal year 2010, $100,000,000;
``(B) for fiscal year 2011, $150,000,000;
``(C) for fiscal year 2012, $200,000,000;
``(D) for fiscal year 2013, $250,000,000; and
``(E) for fiscal year 2014, $300,000,000;
``(3) for carrying out subtitle E (Delivery of Community
Preventive and Wellness Services)--
``(A) for fiscal year 2010, $1,065,000,000;
``(B) for fiscal year 2011, $1,260,000,000;
``(C) for fiscal year 2012, $1,365,000,000;
``(D) for fiscal year 2013, $1,570,000,000; and
``(E) for fiscal year 2014, $1,600,000,000;
``(4) for carrying out section 3161 (Core Public Health
Infrastructure for State, Local, and Tribal Health
Departments)--
``(A) for fiscal year 2010, $800,000,000;
``(B) for fiscal year 2011, $1,000,000,000;
``(C) for fiscal year 2012, $1,100,000,000;
``(D) for fiscal year 2013, $1,200,000,000; and
``(E) for fiscal year 2014, $1,265,000,000; and
``(5) for carrying out section 3162 (Core Public Health
Infrastructure and Activities for CDC), $350,000,000 for each
of fiscal years 2010 through 2014.
``Subtitle B--National Prevention and Wellness Strategy
``SEC. 3121. NATIONAL PREVENTION AND WELLNESS STRATEGY.
``(a) In General.--The Secretary shall submit to the Congress within
one year after the date of the enactment of this section, and at least
every 2 years thereafter, a national strategy that is designed to
improve the Nation's health through evidence-based clinical and
community prevention and wellness activities (in this section referred
to as `prevention and wellness activities'), including core public
health infrastructure improvement activities.
``(b) Contents.--The strategy under subsection (a) shall include each
of the following:
``(1) Identification of specific national goals and
objectives in prevention and wellness activities that take into
account appropriate public health measures and standards,
including departmental measures and standards (including
Healthy People and National Public Health Performance
Standards).
``(2) Establishment of national priorities for prevention and
wellness, taking into account unmet prevention and wellness
needs.
``(3) Establishment of national priorities for research on
prevention and wellness, taking into account unanswered
research questions on prevention and wellness.
``(4) Identification of health disparities in prevention and
wellness.
``(5) Review of prevention payment incentives, the prevention
workforce, and prevention delivery system capacity.
``(6) A plan for addressing and implementing paragraphs (1)
through (5).
``(c) Consultation.--In developing or revising the strategy under
subsection (a), the Secretary shall consult with the following:
``(1) The heads of appropriate health agencies and offices in
the Department, including the Office of the Surgeon General of
the Public Health Service, the Office of Minority Health, the
Office on Women's Health, and the Substance Abuse and Mental
Health Services Administration.
``(2) As appropriate, the heads of other Federal departments
and agencies whose programs have a significant impact upon
health (as determined by the Secretary).
``(3) As appropriate, nonprofit and for-profit entities.
``(4) The Association of State and Territorial Health
Officials and the National Association of County and City
Health Officials.
``(5) The Task Force on Community Preventive Services and the
Task Force on Clinical Preventive Services.
``Subtitle C--Prevention Task Forces
``SEC. 3131. TASK FORCE ON CLINICAL PREVENTIVE SERVICES.
``(a) In General.--The Secretary, acting through the Director of the
Agency for Healthcare Research and Quality, shall establish a permanent
task force to be known as the Task Force on Clinical Preventive
Services (in this section referred to as the `Task Force').
``(b) Responsibilities.--The Task Force shall--
``(1) identify clinical preventive services for review;
``(2) review the scientific evidence related to the benefits,
effectiveness, appropriateness, and costs of clinical
preventive services identified under paragraph (1) for the
purpose of developing, updating, publishing, and disseminating
evidence-based recommendations on the use of such services;
``(3) as appropriate, take into account health disparities in
developing, updating, publishing, and disseminating evidence-
based recommendations on the use of such services;
``(4) identify gaps in clinical preventive services research
and evaluation and recommend priority areas for such research
and evaluation;
``(5) as appropriate, consult with the clinical prevention
stakeholders board in accordance with subsection (f);
``(6) consult with the Task Force on Community Preventive
Services established under section 3132; and
``(7) as appropriate, in carrying out this section, consider
the national strategy under section 3121.
``(c) Role of Agency.--The Secretary shall provide ongoing
administrative, research, and technical support for the operations of
the Task Force, including coordinating and supporting the dissemination
of the recommendations of the Task Force.
``(d) Membership.--
``(1) Number; appointment.--The Task Force shall be composed
of 30 members, appointed by the Secretary.
``(2) Terms.--
``(A) In general.--The Secretary shall appoint
members of the Task Force for a term of 6 years and may
reappoint such members, but the Secretary may not
appoint any member to serve more than a total of 12
years.
``(B) Staggered terms.--Notwithstanding subparagraph
(A), of the members first appointed to serve on the
Task Force after the enactment of this title--
``(i) 10 shall be appointed for a term of 2
years;
``(ii) 10 shall be appointed for a term of 4
years; and
``(iii) 10 shall be appointed for a term of 6
years.
``(3) Qualifications.--Members of the Task Force shall be
appointed from among individuals who possess expertise in at
least one of the following areas:
``(A) Health promotion and disease prevention.
``(B) Evaluation of research and systematic evidence
reviews.
``(C) Application of systematic evidence reviews to
clinical decisionmaking or health policy.
``(D) Clinical primary care in child and adolescent
health.
``(E) Clinical primary care in adult health,
including women's health.
``(F) Clinical primary care in geriatrics.
``(G) Clinical counseling and behavioral services for
primary care patients.
``(4) Representation.--In appointing members of the Task
Force, the Secretary shall ensure that--
``(A) all areas of expertise described in paragraph
(3) are represented; and
``(B) the members of the Task Force include
individuals with expertise in health disparities.
``(e) Subgroups.--As appropriate to maximize efficiency, the Task
Force may delegate authority for conducting reviews and making
recommendations to subgroups consisting of Task Force members, subject
to final approval by the Task Force.
``(f) Clinical Prevention Stakeholders Board.--
``(1) In general.--The Task Force shall convene a clinical
prevention stakeholders board composed of representatives of
appropriate public and private entities with an interest in
clinical preventive services to advise the Task Force on
developing, updating, publishing, and disseminating evidence-
based recommendations on the use of clinical preventive
services.
``(2) Membership.--The members of the clinical prevention
stakeholders board shall include representatives of the
following:
``(A) Health care consumers and patient groups.
``(B) Providers of clinical preventive services,
including community-based providers.
``(C) Federal departments and agencies, including--
``(i) appropriate health agencies and offices
in the Department, including the Office of the
Surgeon General of the Public Health Service,
the Office of Minority Health, the National
Center on Minority Health and Health
Disparities, and the Office on Women's Health;
and
``(ii) as appropriate, other Federal
departments and agencies whose programs have a
significant impact upon health (as determined
by the Secretary).
``(D) Private health care payors.
``(3) Responsibilities.--In accordance with subsection
(b)(5), the clinical prevention stakeholders board shall--
``(A) recommend clinical preventive services for
review by the Task Force;
``(B) suggest scientific evidence for consideration
by the Task Force related to reviews undertaken by the
Task Force;
``(C) provide feedback regarding draft
recommendations by the Task Force; and
``(D) assist with efforts regarding dissemination of
recommendations by the Director of the Agency for
Healthcare Research and Quality.
``(g) Disclosure and Conflicts of Interest.--Members of the Task
Force or the clinical prevention stakeholders board shall not be
considered employees of the Federal Government by reason of service on
the Task Force or the clinical prevention stakeholders board, except
members of the Task Force or the clinical prevention stakeholders board
shall be considered to be special Government employees within the
meaning of section 107 of the Ethics in Government Act of 1978 (5
U.S.C. App.) and section 208 of title 18, United States Code, for the
purposes of disclosure and management of conflicts of interest under
those sections.
``(h) No Pay; Receipt of Travel Expenses.--Members of the Task Force
or the clinical prevention stakeholders board shall not receive any pay
for service on the Task Force, but may receive travel expenses,
including a per diem, in accordance with applicable provisions of
subchapter I of chapter 57 of title 5, United States Code.
``(i) Application of FACA.--The Federal Advisory Committee Act (5
U.S.C. App.) except for section 14 of such Act shall apply to the Task
Force to the extent that the provisions of such Act do not conflict
with the provisions of this title.
``(j) Report.--The Secretary shall submit to the Congress an annual
report on the Task Force, including with respect to gaps identified and
recommendations made under subsection (b)(4).
``(k) Definition.--In this section, the term `health disparities' has
the meaning given the term in section 3171.
``SEC. 3132. TASK FORCE ON COMMUNITY PREVENTIVE SERVICES.
``(a) In General.--The Secretary, acting through the Director of the
Centers for Disease Control and Prevention, shall establish a permanent
task force to be known as the Task Force on Community Preventive
Services (in this section referred to as the `Task Force').
``(b) Responsibilities.--The Task Force shall--
``(1) identify community preventive services for review;
``(2) review the scientific evidence related to the benefits,
effectiveness, appropriateness, and costs of community
preventive services identified under paragraph (1) for the
purpose of developing, updating, publishing, and disseminating
evidence-based recommendations on the use of such services;
``(3) as appropriate, take into account health disparities in
developing, updating, publishing, and disseminating evidence-
based recommendations on the use of such services;
``(4) identify gaps in community preventive services research
and evaluation and recommend priority areas for such research
and evaluation;
``(5) as appropriate, consult with the community prevention
stakeholders board in accordance with subsection (f);
``(6) consult with the Task Force on Clinical Preventive
Services established under section 3131; and
``(7) as appropriate, in carrying out this section, consider
the national strategy under section 3121.
``(c) Role of Agency.--The Secretary shall provide ongoing
administrative, research, and technical support for the operations of
the Task Force, including coordinating and supporting the dissemination
of the recommendations of the Task Force.
``(d) Membership.--
``(1) Number; appointment.--The Task Force shall be composed
of 30 members, appointed by the Secretary.
``(2) Terms.--
``(A) In general.--The Secretary shall appoint
members of the Task Force for a term of 6 years and may
reappoint such members, but the Secretary may not
appoint any member to serve more than a total of 12
years.
``(B) Staggered terms.--Notwithstanding subparagraph
(A), of the members first appointed to serve on the
Task Force after the enactment of this section--
``(i) 10 shall be appointed for a term of 2
years;
``(ii) 10 shall be appointed for a term of 4
years; and
``(iii) 10 shall be appointed for a term of 6
years.
``(3) Qualifications.--Members of the Task Force shall be
appointed from among individuals who possess expertise in at
least one of the following areas:
``(A) Public health.
``(B) Evaluation of research and systematic evidence
reviews.
``(C) Disciplines relevant to community preventive
services, including health promotion; disease
prevention; chronic disease; worksite health;
qualitative and quantitative analysis; and health
economics, policy, law, and statistics.
``(4) Representation.--In appointing members of the Task
Force, the Secretary--
``(A) shall ensure that all areas of expertise
described in paragraph (3) are represented;
``(B) shall ensure that such members include
sufficient representatives of each of--
``(i) State health officers;
``(ii) local health officers;
``(iii) health care practitioners; and
``(iv) public health practitioners; and
``(C) shall appoint individuals who have expertise in
health disparities.
``(e) Subgroups.--As appropriate to maximize efficiency, the Task
Force may delegate authority for conducting reviews and making
recommendations to subgroups consisting of Task Force members, subject
to final approval by the Task Force.
``(f) Community Prevention Stakeholders Board.--
``(1) In general.--The Task Force shall convene a community
prevention stakeholders board composed of representatives of
appropriate public and private entities with an interest in
community preventive services to advise the Task Force on
developing, updating, publishing, and disseminating evidence-
based recommendations on the use of community preventive
services.
``(2) Membership.--The members of the community prevention
stakeholders board shall include representatives of the
following:
``(A) Health care consumers and patient groups.
``(B) Providers of community preventive services,
including community-based providers.
``(C) Federal departments and agencies, including--
``(i) appropriate health agencies and offices
in the Department, including the Office of the
Surgeon General of the Public Health Service,
the Office of Minority Health, the National
Center on Minority Health and Health
Disparities, and the Office on Women's Health;
and
``(ii) as appropriate, other Federal
departments and agencies whose programs have a
significant impact upon health (as determined
by the Secretary).
``(D) Private health care payors.
``(3) Responsibilities.--In accordance with subsection
(b)(5), the community prevention stakeholders board shall--
``(A) recommend community preventive services for
review by the Task Force;
``(B) suggest scientific evidence for consideration
by the Task Force related to reviews undertaken by the
Task Force;
``(C) provide feedback regarding draft
recommendations by the Task Force; and
``(D) assist with efforts regarding dissemination of
recommendations by the Director of the Centers for
Disease Control and Prevention.
``(g) Disclosure and Conflicts of Interest.--Members of the Task
Force or the community prevention stakeholders board shall not be
considered employees of the Federal Government by reason of service on
the Task Force or the community prevention stakeholders board, except
members of the Task Force or the community prevention stakeholders
board shall be considered to be special Government employees within the
meaning of section 107 of the Ethics in Government Act of 1978 (5
U.S.C. App.) and section 208 of title 18, United States Code, for the
purposes of disclosure and management of conflicts of interest under
those sections.
``(h) No Pay; Receipt of Travel Expenses.--Members of the Task Force
or the community prevention stakeholders board shall not receive any
pay for service on the Task Force, but may receive travel expenses,
including a per diem, in accordance with applicable provisions of
subchapter I of chapter 57 of title 5, United States Code.
``(i) Application of FACA.--The Federal Advisory Committee Act (5
U.S.C. App.) except for section 14 of such Act shall apply to the Task
Force to the extent that the provisions of such Act do not conflict
with the provisions of this title.
``(j) Report.--The Secretary shall submit to the Congress an annual
report on the Task Force, including with respect to gaps identified and
recommendations made under subsection (b)(4).
``(k) Definition.--In this section, the term `health disparities' has
the meaning given the term in section 3171.
``Subtitle D--Prevention and Wellness Research
``SEC. 3141. PREVENTION AND WELLNESS RESEARCH ACTIVITY COORDINATION.
``In conducting or supporting research on prevention and wellness,
the Director of the Centers for Disease Control and Prevention, the
Director of the National Institutes of Health, and the heads of other
agencies within the Department of Health and Human Services conducting
or supporting such research, shall take into consideration the national
strategy under section 3121 and the recommendations of the Task Force
on Clinical Preventive Services under section 3131 and the Task Force
on Community Preventive Services under section 3132.
``SEC. 3142. COMMUNITY PREVENTION AND WELLNESS RESEARCH GRANTS.
``(a) In General.--The Secretary, acting through the Director of the
Centers for Disease Control and Prevention, shall conduct, or award
grants to eligible entities to conduct, research in priority areas
identified by the Secretary in the national strategy under section 3121
or by the Task Force on Community Preventive Services as required by
section 3132.
``(b) Eligibility.--To be eligible for a grant under this section, an
entity shall be--
``(1) a State, local, or tribal department of health;
``(2) a public or private nonprofit entity; or
``(3) a consortium of 2 or more entities described in
paragraphs (1) and (2).
``(c) Report.--The Secretary shall submit to the Congress an annual
report on the program of research under this section.
``Subtitle E--Delivery of Community Prevention and Wellness Services
``SEC. 3151. COMMUNITY PREVENTION AND WELLNESS SERVICES GRANTS.
``(a) In General.--The Secretary, acting through the Director of the
Centers for Disease Control and Prevention, shall establish a program
for the delivery of community prevention and wellness services
consisting of awarding grants to eligible entities--
``(1) to provide evidence-based, community prevention and
wellness services in priority areas identified by the Secretary
in the national strategy under section 3121; or
``(2) to plan such services.
``(b) Eligibility.--
``(1) Definition.--To be eligible for a grant under this
section, an entity shall be--
``(A) a State, local, or tribal department of health;
``(B) a public or private entity; or
``(C) a consortium of--
``(i) 2 or more entities described in
subparagraph (A) or (B); and
``(ii) a community partnership representing a
Health Empowerment Zone.
``(2) Health empowerment zone.--In this subsection, the term
`Health Empowerment Zone' means an area--
``(A) in which multiple community prevention and
wellness services are implemented in order to address
one or more health disparities, including those
identified by the Secretary in the national strategy
under section 3121; and
``(B) which is represented by a community partnership
that demonstrates community support and coordination
with State, local, or tribal health departments and
includes--
``(i) a broad cross section of stakeholders;
``(ii) residents of the community; and
``(iii) representatives of entities that have
a history of working within and serving the
community.
``(c) Preferences.--In awarding grants under this section, the
Secretary shall give preference to entities that--
``(1) will address one or more goals or objectives identified
by the Secretary in the national strategy under section 3121;
``(2) will address significant health disparities, including
those identified by the Secretary in the national strategy
under section 3121;
``(3) will address unmet community prevention and wellness
needs and avoids duplication of effort;
``(4) have been demonstrated to be effective in communities
comparable to the proposed target community;
``(5) will contribute to the evidence base for community
prevention and wellness services;
``(6) demonstrate that the community prevention and wellness
services to be funded will be sustainable; and
``(7) demonstrate coordination or collaboration across
governmental and nongovernmental partners.
``(d) Health Disparities.--Of the funds awarded under this section
for a fiscal year, the Secretary shall award not less than 50 percent
for planning or implementing community prevention and wellness services
whose primary purpose is to achieve a measurable reduction in one or
more health disparities, including those identified by the Secretary in
the national strategy under section 3121.
``(e) Emphasis on Recommended Services.--For fiscal year 2013 and
subsequent fiscal years, the Secretary shall award grants under this
section only for planning or implementing services recommended by the
Task Force on Community Preventive Services under section 3122 or
deemed effective based on a review of comparable rigor (as determined
by the Director of the Centers for Disease Control and Prevention).
``(f) Prohibited Uses of Funds.--An entity that receives a grant
under this section may not use funds provided through the grant--
``(1) to build or acquire real property or for construction;
or
``(2) for services or planning to the extent that payment has
been made, or can reasonably be expected to be made--
``(A) under any insurance policy;
``(B) under any Federal or State health benefits
program (including titles XIX and XXI of the Social
Security Act); or
``(C) by an entity which provides health services on
a prepaid basis.
``(g) Report.--The Secretary shall submit to the Congress an annual
report on the program of grants awarded under this section.
``(h) Definitions.--In this section, the term `evidence-based' means
that methodologically sound research has demonstrated a beneficial
health effect, in the judgment of the Director of the Centers for
Disease Control and Prevention.
``Subtitle F--Core Public Health Infrastructure
``SEC. 3161. CORE PUBLIC HEALTH INFRASTRUCTURE FOR STATE, LOCAL, AND
TRIBAL HEALTH DEPARTMENTS.
``(a) Program.--The Secretary, acting through the Director of the
Centers for Disease Control and Prevention shall establish a core
public health infrastructure program consisting of awarding grants
under subsection (b).
``(b) Grants.--
``(1) Award.--For the purpose of addressing core public
health infrastructure needs, the Secretary--
``(A) shall award a grant to each State health
department; and
``(B) may award grants on a competitive basis to
State, local, or tribal health departments.
``(2) Allocation.--Of the total amount of funds awarded as
grants under this subsection for a fiscal year--
``(A) not less than 50 percent shall be for grants to
State health departments under paragraph (1)(A); and
``(B) not less than 30 percent shall be for grants to
State, local, or tribal health departments under
paragraph (1)(B).
``(c) Use of Funds.--The Secretary may award a grant to an entity
under subsection (b)(1) only if the entity agrees to use the grant to
address core public health infrastructure needs, including those
identified in the accreditation process under subsection (g).
``(d) Formula Grants to State Health Departments.--In making grants
under subsection (b)(1)(A), the Secretary shall award funds to each
State health department in accordance with--
``(1) a formula based on population size; burden of
preventable disease and disability; and core public health
infrastructure gaps, including those identified in the
accreditation process under subsection (g); and
``(2) application requirements established by the Secretary,
including a requirement that the State submit a plan that
demonstrates to the satisfaction of the Secretary that the
State's health department will--
``(A) address its highest priority core public health
infrastructure needs; and
``(B) as appropriate, allocate funds to local health
departments within the State.
``(e) Competitive Grants to State, Local, and Tribal Health
Departments.--In making grants under subsection (b)(1)(B), the
Secretary shall give priority to applicants demonstrating core public
health infrastructure needs identified in the accreditation process
under subsection (g).
``(f) Maintenance of Effort.--The Secretary may award a grant to an
entity under subsection (b) only if the entity demonstrates to the
satisfaction of the Secretary that--
``(1) funds received through the grant will be expended only
to supplement, and not supplant, non-Federal and Federal funds
otherwise available to the entity for the purpose of addressing
core public health infrastructure needs; and
``(2) with respect to activities for which the grant is
awarded, the entity will maintain expenditures of non-Federal
amounts for such activities at a level not less than the level
of such expenditures maintained by the entity for the fiscal
year preceding the fiscal year for which the entity receives
the grant.
``(g) Establishment of a Public Health Accreditation Program.--
``(1) In general.--The Secretary, acting through the Director
of the Centers for Disease Control and Prevention, shall--
``(A) develop, and periodically review and update,
standards for voluntary accreditation of State, local,
or tribal health departments and public health
laboratories for the purpose of advancing the quality
and performance of such departments and laboratories;
and
``(B) implement a program to accredit such health
departments and laboratories in accordance with such
standards.
``(2) Cooperative agreement.--The Secretary may enter into a
cooperative agreement with a private nonprofit entity to carry
out paragraph (1).
``(h) Report.--The Secretary shall submit to the Congress an annual
report on progress being made to accredit entities under subsection
(g), including--
``(1) a strategy, including goals and objectives, for
accrediting entities under subsection (g) and achieving the
purpose described in subsection (g)(1); and
``(2) identification of gaps in research related to core
public health infrastructure and recommendations of priority
areas for such research.
``SEC. 3162. CORE PUBLIC HEALTH INFRASTRUCTURE AND ACTIVITIES FOR CDC.
``(a) In General.--The Secretary, acting through the Director of the
Centers for Disease Control and Prevention, shall expand and improve
the core public health infrastructure and activities of the Centers for
Disease Control and Prevention to address unmet and emerging public
health needs.
``(b) Report.--The Secretary shall submit to the Congress an annual
report on the activities funded through this section.
``Subtitle G--General Provisions
``SEC. 3171. DEFINITIONS.
``In this title:
``(1) The term `core public health infrastructure' includes
workforce capacity and competency; laboratory systems; health
information, health information systems, and health information
analysis; communications; financing; other relevant components
of organizational capacity; and other related activities.
``(2) The terms `Department' and `departmental' refer to the
Department of Health and Human Services.
``(3) The term `health disparities' includes health and
health care disparities and means population-specific
differences in the presence of disease, health outcomes, or
access to health care. For purposes of the preceding sentence,
a population may be delineated by race, ethnicity, geographic
setting, and other populations or subpopulations determined by
the Secretary to experience significant gaps in disease, health
outcomes, or access to health care.
``(4) The term `tribal' refers to an Indian tribe, a Tribal
organization, or an Urban Indian organization, as such terms
are defined in section 4 of the Indian Health Care Improvement
Act.''.
(b) Transition Provisions Applicable to Task Forces.--
(1) Functions, personnel, assets, liabilities, and
administrative actions.--All functions, personnel, assets, and
liabilities of, and administrative actions applicable to, the
Preventive Services Task Force convened under section 915(a) of
the Public Health Service Act and the Task Force on Community
Preventive Services (as such section and Task Forces were in
existence on the day before the date of the enactment of this
Act) shall be transferred to the Task Force on Clinical
Preventive Services and the Task Force on Community Preventive
Services, respectively, established under sections 3121 and
3122 of the Public Health Service Act, as added by subsection
(a).
(2) Recommendations.--All recommendations of the Preventive
Services Task Force and the Task Force on Community Preventive
Services, as in existence on the day before the date of the
enactment of this Act, shall be considered to be
recommendations of the Task Force on Clinical Preventive
Services and the Task Force on Community Preventive Services,
respectively, established under sections 3121 and 3122 of the
Public Health Service Act, as added by subsection (a).
(3) Members already serving.--
(A) Initial members.--The Secretary of Health and
Human Services may select those individuals already
serving on the Preventive Services Task Force and the
Task Force on Community Preventive Services, as in
existence on the day before the date of the enactment
of this Act, to be among the first members appointed to
the Task Force on Clinical Preventive Services and the
Task Force on Community Preventive Services,
respectively, under sections 3121 and 3122 of the
Public Health Service Act, as added by subsection (a).
(B) Calculation of total service.--In calculating the
total years of service of a member of a task force for
purposes of section 3131(d)(2)(A) or 3132(d)(2)(A) of
the Public Health Service Act, as added by subsection
(a), the Secretary of Health and Human Services shall
not include any period of service by the member on the
Preventive Services Task Force or the Task Force on
Community Preventive Services, respectively, as in
existence on the day before the date of the enactment
of this Act.
(c) Period Before Completion of National Strategy.--Pending
completion of the national strategy under section 3121 of the Public
Health Service Act, as added by subsection (a), the Secretary of Health
and Human Services, acting through the relevant agency head, may make a
judgment about how the strategy will address an issue and rely on such
judgment in carrying out any provision of subtitle C, D, E, or F of
title XXXI of such Act, as added by subsection (a), that requires the
Secretary--
(1) to take into consideration such strategy;
(2) to conduct or support research or provide services in
priority areas identified in such strategy; or
(3) to take any other action in reliance on such strategy.
(d) Conforming Amendments.--
(1) Paragraph (61) of section 3(b) of the Indian Health Care
Improvement Act (25 U.S.C. 1602) is amended by striking
``United States Preventive Services Task Force'' and inserting
``Task Force on Clinical Preventive Services''.
(2) Section 126 of the Medicare, Medicaid, and SCHIP Benefits
Improvement and Protection Act of 2000 (Appendix F of Public
Law 106-554) is amended by striking ``United States Preventive
Services Task Force'' each place it appears and inserting
``Task Force on Clinical Preventive Services''.
(3) Paragraph (7) of section 317D(a) of the Public Health
Service Act (42 U.S.C. 247b-5(a)) is amended by striking
``United States Preventive Services Task Force'' and inserting
``Task Force on Clinical Preventive Services''.
(4) Section 915 of the Public Health Service Act (42 U.S.C.
299b-4) is amended by striking subsection (a).
(5) Subsections (s)(2)(AA)(iii)(II), (xx)(1), and (ddd)(1)(B)
of section 1861 of the Social Security Act (42 U.S.C. 1395x)
are amended by striking ``United States Preventive Services
Task Force'' each place it appears and inserting ``Task Force
on Clinical Preventive Services''.
TITLE IV--QUALITY AND SURVEILLANCE
SEC. 2401. IMPLEMENTATION OF BEST PRACTICES IN THE DELIVERY OF HEALTH
CARE.
(a) In General.--Title IX of the Public Health Service Act (42 U.S.C.
299 et seq.) is amended--
(1) by redesignating part D as part E;
(2) by redesignating sections 931 through 938 as sections 941
through 948, respectively;
(3) in section 948(1), as redesignated, by striking ``931''
and inserting ``941''; and
(4) by inserting after part C the following:
``PART D--IMPLEMENTATION OF BEST PRACTICES IN THE DELIVERY OF HEALTH
CARE
``SEC. 931. CENTER FOR QUALITY IMPROVEMENT.
``(a) In General.--There is established the Center for Quality
Improvement (referred to in this part as the `Center'), to be headed by
the Director.
``(b) Prioritization.--
``(1) In general.--The Director shall prioritize areas for
the identification, development, evaluation, and implementation
of best practices (including innovative methodologies and
strategies) for quality improvement activities in the delivery
of health care services (in this section referred to as `best
practices').
``(2) Considerations.--In prioritizing areas under paragraph
(1), the Director shall consider--
``(A) the priorities established under section 1191
of the Social Security Act; and
``(B) the key health indicators identified by the
Assistant Secretary for Health Information under
section 1709.
``(3) Limitations.--In conducting its duties under this
subsection, the Center for Quality Improvement shall not
develop quality-adjusted life year measures or any other
methodologies that can be used to deny benefits to a
beneficiary against the beneficiary's wishes on the basis of
the beneficiary's age, life expectancy, present or predicted
disability, or expected quality of life.
``(c) Other Responsibilities.--The Director, acting directly or by
awarding a grant or contract to an eligible entity, shall--
``(1) identify existing best practices under subsection (e);
``(2) develop new best practices under subsection (f);
``(3) evaluate best practices under subsection (g);
``(4) implement best practices under subsection (h);
``(5) ensure that best practices are identified, developed,
evaluated, and implemented under this section consistent with
standards adopted by the Secretary under section 3004 for
health information technology used in the collection and
reporting of quality information (including for purposes of the
demonstration of meaningful use of certified electronic health
record (EHR) technology by physicians and hospitals under the
Medicare program (under sections 1848(o)(2) and 1886(n)(3),
respectively, of the Social Security Act)); and
``(6) provide for dissemination of information and reporting
under subsections (i) and (j).
``(d) Eligibility.--To be eligible for a grant or contract under
subsection (c), an entity shall--
``(1) be a nonprofit entity;
``(2) agree to work with a variety of institutional health
care providers, physicians, nurses, and other health care
practitioners; and
``(3) if the entity is not the organization holding a
contract under section 1153 of the Social Security Act for the
area to be served, agree to cooperate with and avoid
duplication of the activities of such organization.
``(e) Identifying Existing Best Practices.--The Secretary shall
identify best practices that are--
``(1) currently utilized by health care providers (including
hospitals, physician and other clinician practices, community
cooperatives, and other health care entities) that deliver
consistently high-quality, efficient health care services; and
``(2) easily adapted for use by other health care providers
and for use across a variety of health care settings.
``(f) Developing New Best Practices.--The Secretary shall develop
best practices that are--
``(1) based on a review of existing scientific evidence;
``(2) sufficiently detailed for implementation and
incorporation into the workflow of health care providers; and
``(3) designed to be easily adapted for use by health care
providers across a variety of health care settings.
``(g) Evaluation of Best Practices.--The Director shall evaluate best
practices identified or developed under this section. Such evaluation--
``(1) shall include determinations of which best practices--
``(A) most reliably and effectively achieve
significant progress in improving the quality of
patient care; and
``(B) are easily adapted for use by health care
providers across a variety of health care settings;
``(2) shall include regular review, updating, and improvement
of such best practices; and
``(3) may include in-depth case studies or empirical
assessments of health care providers (including hospitals,
physician and other clinician practices, community
cooperatives, and other health care entities) and simulations
of such best practices for determinations under paragraph (1).
``(h) Implementation of Best Practices.--
``(1) In general.--The Director shall enter into arrangements
with entities in a State or region to implement best practices
identified or developed under this section. Such
implementation--
``(A) may include forming collaborative multi-
institutional teams; and
``(B) shall include an evaluation of the best
practices being implemented, including the measurement
of patient outcomes before, during, and after
implementation of such best practices.
``(2) Preferences.--In carrying out this subsection, the
Director shall give priority to health care providers
implementing best practices that--
``(A) have the greatest impact on patient outcomes
and satisfaction;
``(B) are the most easily adapted for use by health
care providers across a variety of health care
settings;
``(C) promote coordination of health care
practitioners across the continuum of care; and
``(D) engage patients and their families in improving
patient care and outcomes.
``(i) Public Dissemination of Information.--The Director shall
provide for the public dissemination of information with respect to
best practices and activities under this section. Such information
shall be made available in appropriate formats and languages to reflect
the varying needs of consumers and diverse levels of health literacy.
``(j) Report.--
``(1) In general.--The Director shall submit an annual report
to the Congress and the Secretary on activities under this
section.
``(2) Content.--Each report under paragraph (1) shall
include--
``(A) information on activities conducted pursuant to
grants and contracts awarded;
``(B) summary data on patient outcomes before,
during, and after implementation of best practices; and
``(C) recommendations on the adaptability of best
practices for use by health providers.''.
(b) Initial Quality Improvement Activities and Initiatives To Be
Implemented.--Until the Director of the Agency for Healthcare Research
and Quality has established initial priorities under section 931(b) of
the Public Health Service Act, as added by subsection (a), the Director
shall, for purposes of such section, prioritize the following:
(1) Health care-associated infections.--Reducing health care-
associated infections, including infections in nursing homes
and outpatient settings.
(2) Surgery.--Increasing hospital and outpatient
perioperative patient safety, including reducing surgical-site
infections and surgical errors (such as wrong-site surgery and
retained foreign bodies).
(3) Emergency room.--Improving care in hospital emergency
rooms, including through the use of principles of efficiency of
design and delivery to improve patient flow.
(4) Obstetrics.--Improving the provision of obstetrical and
neonatal care, including the identification of interventions
that are effective in reducing the risk of preterm and
premature labor and the implementation of best practices for
labor and delivery care.
(5) Pediatrics.--Improving the provision of preventive and
developmental child health services, including interventions
that can reduce child health disparities and reduce the risk of
developing chronic health-threatening conditions that affect an
individual's life course development.
(c) Report.--Not later than 18 months after the date of the enactment
of this Act, the Director of the Agency for Healthcare Research and
Quality shall submit a report to the Congress on the impact of the
nurse-to-patient ratio on the quality of care and patient outcomes,
including recommendations for further integration into quality
measurement and quality improvement activities.
SEC. 2402. ASSISTANT SECRETARY FOR HEALTH INFORMATION.
(a) Establishment.--Title XVII (42 U.S.C. 300u et seq.) is amended--
(1) by redesignating sections 1709 and 1710 as sections 1710
and 1711, respectively; and
(2) by inserting after section 1708 the following:
``SEC. 1709. ASSISTANT SECRETARY FOR HEALTH INFORMATION.
``(a) In General.--There is established within the Department an
Assistant Secretary for Health Information (in this section referred to
as the `Assistant Secretary'), to be appointed by the Secretary.
``(b) Responsibilities.--The Assistant Secretary shall--
``(1) ensure the collection, collation, reporting, and
publishing of information (including full and complete
statistics) on key health indicators regarding the Nation's
health and the performance of the Nation's health care;
``(2) facilitate and coordinate the collection, collation,
reporting, and publishing of information regarding the Nation's
health and the performance of the Nation's health care (other
than information described in paragraph (1));
``(3)(A) develop standards for the collection of data
regarding the Nation's health and the performance of the
Nation's health care; and
``(B) in carrying out subparagraph (A)--
``(i) ensure appropriate specificity and
standardization for data collection at the national,
regional, State, and local levels;
``(ii) include standards, as appropriate, for the
collection of accurate data on health and health care
by race, ethnicity, primary language, sex, sexual
orientation, gender identity, disability, socioeconomic
status, rural, urban, or other geographic setting, and
any other population or subpopulation determined
appropriate by the Secretary;
``(iii) ensure, with respect to data on race and
ethnicity, consistency with the 1997 Office of
Management and Budget Standards for Maintaining,
Collecting and Presenting Federal Data on Race and
Ethnicity (or any successor standards); and
``(iv) in consultation with the Director of the
Office of Minority Health, and the Director of the
Office of Civil Rights, of the Department, develop
standards for the collection of data on health and
health care with respect to primary language;
``(4) provide support to Federal departments and agencies
whose programs have a significant impact upon health (as
determined by the Secretary) for the collection and collation
of information described in paragraphs (1) and (2);
``(5) ensure the sharing of information described in
paragraphs (1) and (2) among the agencies of the Department;
``(6) facilitate the sharing of information described in
paragraphs (1) and (2) by Federal departments and agencies
whose programs have a significant impact upon health (as
determined by the Secretary);
``(7) identify gaps in information described in paragraphs
(1) and (2) and the appropriate agency or entity to address
such gaps;
``(8) facilitate and coordinate identification and monitoring
by the agencies of the Department of health disparities to
inform program and policy efforts to reduce such disparities,
including facilitating and funding analyses conducted in
cooperation with the Social Security Administration, the Bureau
of the Census, and other appropriate agencies and entities;
``(9) consistent with privacy, proprietary, and other
appropriate safeguards, facilitate public accessibility of
datasets (such as de-identified Medicare datasets or publicly
available data on key health indicators) by means of the
Internet; and
``(10) award grants or contracts for the collection and
collation of information described in paragraphs (1) and (2)
(including through statewide surveys that provide standardized
information).
``(c) Key Health Indicators.--
``(1) In general.--In carrying out subsection (b)(1), the
Assistant Secretary shall--
``(A) identify, and reassess at least once every 3
years, key health indicators described in such
subsection;
``(B) publish statistics on such key health
indicators for the public--
``(i) not less than annually; and
``(ii) on a supplemental basis whenever
warranted by--
``(I) the rate of change for a key
health indicator; or
``(II) the need to inform policy
regarding the Nation's health and the
performance of the Nation's health
care; and
``(C) ensure consistency with the national strategy
developed by the Secretary under section 3121 and
consideration of the indicators specified in the
reports under sections 308, 903(a)(6), and 913(b)(2).
``(2) Release of key health indicators.--The regulations,
rules, processes, and procedures of the Office of Management
and Budget governing the review, release, and dissemination of
key health indicators shall be the same as the regulations,
rules, processes, and procedures of the Office of Management
and Budget governing the review, release, and dissemination of
Principal Federal Economic Indicators (or equivalent
statistical data) by the Bureau of Labor Statistics.
``(d) Coordination.--In carrying out this section, the Assistant
Secretary shall coordinate with--
``(1) public and private entities that collect and
disseminate information on health and health care, including
foundations; and
``(2) the head of the Office of the National Coordinator for
Health Information Technology to ensure optimal use of health
information technology.
``(e) Request for Information From Other Departments and Agencies.--
Consistent with applicable law, the Assistant Secretary may secure
directly from any Federal department or agency information necessary to
enable the Assistant Secretary to carry out this section.
``(f) Report.--
``(1) Submission.--The Assistant Secretary shall submit to
the Secretary and the Congress an annual report containing--
``(A) a description of national, regional, or State
changes in health or health care, as reflected by the
key health indicators identified under subsection
(c)(1);
``(B) a description of gaps in the collection,
collation, reporting, and publishing of information
regarding the Nation's health and the performance of
the Nation's health care;
``(C) recommendations for addressing such gaps and
identification of the appropriate agency within the
Department or other entity to address such gaps;
``(D) a description of analyses of health
disparities, including the results of completed
analyses, the status of ongoing longitudinal studies,
and proposed or planned research; and
``(E) a plan for actions to be taken by the Assistant
Secretary to address gaps described in subparagraph
(B).
``(2) Consideration.--In preparing a report under paragraph
(1), the Assistant Secretary shall take into consideration the
findings and conclusions in the reports under sections 308,
903(a)(6), and 913(b)(2).
``(g) Proprietary and Privacy Protections.--Nothing in this section
shall be construed to affect applicable proprietary or privacy
protections.
``(h) Consultation.--In carrying out this section, the Assistant
Secretary shall consult with--
``(1) the heads of appropriate health agencies and offices in
the Department, including the Office of the Surgeon General of
the Public Health Service, the Office of Minority Health, and
the Office on Women's Health; and
``(2) as appropriate, the heads of other Federal departments
and agencies whose programs have a significant impact upon
health (as determined by the Secretary).
``(i) Definition.--In this section:
``(1) The terms `agency' and `agencies' include an
epidemiology center established under section 214 of the Indian
Health Care Improvement Act.
``(2) The term `Department' means the Department of Health
and Human Services.
``(3) The term `health disparities' has the meaning given to
such term in section 3171.''.
(b) Other Coordination Responsibilities.--Title III (42 U.S.C. 241 et
seq.) is amended--
(1) in paragraphs (1) and (2) of section 304(c) (42 U.S.C.
242b(c)), by inserting ``, acting through the Assistant
Secretary for Health Information,'' after ``The Secretary''
each place it appears; and
(2) in section 306(j) (42 U.S.C. 242k(j)), by inserting ``,
acting through the Assistant Secretary for Health
Information,'' after ``of this section, the Secretary''.
SEC. 2403. AUTHORIZATION OF APPROPRIATIONS.
Section 799C, as added and amended, is further amended by adding at
the end the following:
``(e) Quality and Surveillance.--For the purpose of carrying out part
D of title IX and section 1709, in addition to any other amounts
authorized to be appropriated for such purpose, there are authorized to
be appropriated, out of any monies in the Public Health Investment
Fund, $300,000,000 for each of fiscal years 2010 through 2014.''.
TITLE V--OTHER PROVISIONS
Subtitle A--Drug Discount for Rural and Other Hospitals
SEC. 2501. EXPANDED PARTICIPATION IN 340B PROGRAM.
(a) Expansion of Covered Entities Receiving Discounted Prices.--
Section 340B(a)(4) (42 U.S.C. 256b(a)(4)) is amended by adding at the
end the following:
``(M) A children's hospital excluded from the
Medicare prospective payment system pursuant to section
1886(d)(1)(B)(iii) of the Social Security Act which
would meet the requirements of subparagraph (L),
including the disproportionate share adjustment
percentage requirement under subparagraph (L)(ii), if
the hospital were a subsection (d) hospital as defined
in section 1886(d)(1)(B) of the Social Security Act.
``(N) An entity that is a critical access hospital
(as determined under section 1820(c)(2) of the Social
Security Act).
``(O) An entity receiving funds under title V of the
Social Security Act (relating to maternal and child
health) for the provision of health services.
``(P) An entity receiving funds under subpart I of
part B of title XIX of the Public Health Service Act
(relating to comprehensive mental health services) for
the provision of community mental health services.
``(Q) An entity receiving funds under subpart II of
such part B (relating to the prevention and treatment
of substance abuse) for the provision of treatment
services for substance abuse.
``(R) An entity that is a Medicare-dependent, small
rural hospital (as defined in section 1886(d)(5)(G)(iv)
of the Social Security Act).
``(S) An entity that is a sole community hospital (as
defined in section 1886(d)(5)(D)(iii) of the Social
Security Act).
``(T) An entity that is classified as a rural
referral center under section 1886(d)(5)(C) of the
Social Security Act.''.
(b) Prohibition on Group Purchasing Arrangements.--Section 340B(a)
(42 U.S.C. 256b(a)) is amended--
(1) in paragraph (4)(L)--
(A) by adding ``and'' at the end of clause (i);
(B) by striking ``; and'' at the end of clause (ii)
and inserting a period; and
(C) by striking clause (iii); and
(2) in paragraph (5), by redesignating subparagraphs (C) and
(D) as subparagraphs (D) and (E), respectively, and by
inserting after subparagraph (B) the following:
``(C) Prohibiting use of group purchasing
arrangements.--
``(i) A hospital described in subparagraph
(L), (M), (N), (R), (S), or (T) of paragraph
(4) shall not obtain covered outpatient drugs
through a group purchasing organization or
other group purchasing arrangement, except as
permitted or provided pursuant to clause (ii).
``(ii) The Secretary shall establish
reasonable exceptions to the requirement of
clause (i)--
``(I) with respect to a covered
outpatient drug that is unavailable to
be purchased through the program under
this section due to a drug shortage
problem, manufacturer noncompliance, or
any other reason beyond the hospital's
control;
``(II) to facilitate generic
substitution when a generic covered
outpatient drug is available at a lower
price; and
``(III) to reduce in other ways the
administrative burdens of managing both
inventories of drugs obtained under
this section and not under this
section, if such exception does not
create a duplicate discount problem in
violation of subparagraph (A) or a
diversion problem in violation of
subparagraph (B).''.
SEC. 2502. EXTENSION OF DISCOUNTS TO INPATIENT DRUGS.
(a) In General.--Section 340B (42 U.S.C. 256b) is amended--
(1) in subsection (b)--
(A) by striking ``In this section, the terms'' and
inserting the following: ``In this section:
``(1) In general.--The terms''; and
(B) by adding at the end the following new paragraph:
``(2) Covered drug.--The term `covered drug'--
``(A) means a covered outpatient drug (as defined in
section 1927(k)(2) of the Social Security Act); and
``(B) includes, notwithstanding the section
1927(k)(3)(A) of such Act, a drug used in connection
with an inpatient or outpatient service provided by a
hospital described in subparagraph (L), (M), (N), (R),
(S), or (T) of subsection (a)(4) that is enrolled to
participate in the drug discount program under this
section.''; and
(2) in paragraphs (5) (other than subparagraph (C)), (7), and
(9) of subsection (a), by striking ``outpatient'' each place it
appears.
(b) Medicaid Credits on Inpatient Drugs.--Subsection (c) of section
340B (42 U.S.C. 256b(c)) is amended to read as follows:
``(c) Medicaid Credits on Inpatient Drugs.--
``(1) In general.--For the cost reporting period covered by
the most recently filed Medicare cost report under title XVIII
of the Social Security Act, a hospital described in
subparagraph (L), (M), (N), (R), (S), or (T) of subsection
(a)(4) and enrolled to participate in the drug discount program
under this section shall provide to each State under its plan
under title XIX of such Act--
``(A) a credit on the estimated annual costs to such
hospital of single source and innovator multiple source
drugs provided to Medicaid beneficiaries for inpatient
use; and
``(B) a credit on the estimated annual costs to such
hospital of noninnovator multiple source drugs provided
to Medicaid beneficiaries for inpatient use.
``(2) Amount of credits.--
``(A) Single source and innovator multiple source
drugs.--For purposes of paragraph (1)(A)--
``(i) the credit under such paragraph shall
be equal to the product of--
``(I) the annual value of single
source and innovator multiple source
drugs purchased under this section by
the hospital based on the drugs'
average manufacturer price;
``(II) the estimated percentage of
the hospital's drug purchases
attributable to Medicaid beneficiaries
for inpatient use; and
``(III) the minimum rebate percentage
described in section 1927(c)(1)(B) of
the Social Security Act;
``(ii) the reference in clause (i)(I) to the
annual value of single source and innovator
multiple source drugs purchased under this
section by the hospital based on the drugs'
average manufacturer price shall be equal to
the sum of--
``(I) the annual quantity of each
single source and innovator multiple
source drug purchased during the cost
reporting period, multiplied by
``(II) the average manufacturer price
for that drug;
``(iii) the reference in clause (i)(II) to
the estimated percentage of the hospital's drug
purchases attributable to Medicaid
beneficiaries for inpatient use shall be equal
to--
``(I) the Medicaid inpatient drug
charges as reported on the hospital's
most recently filed Medicare cost
report, divided by
``(II) total drug charges reported on
the cost report; and
``(iv) the terms `single source drug' and
`innovator multiple source drug' have the
meanings given such terms in section 1927(k)(7)
of the Social Security Act.
``(B) Noninnovator multiple source drugs.--For
purposes of paragraph (1)(B)--
``(i) the credit under such paragraph shall
be equal to the product of--
``(I) the annual value of
noninnovator multiple source drugs
purchased under this section by the
hospital based on the drugs' average
manufacturer price;
``(II) the estimated percentage of
the hospital's drug purchases
attributable to Medicaid beneficiaries
for inpatient use; and
``(III) the applicable percentage as
defined in section 1927(c)(3)(B) of the
Social Security Act;
``(ii) the reference in clause (i)(I) to the
annual value of noninnovator multiple source
drugs purchased under this section by the
hospital based on the drugs' average
manufacturer price shall be equal to the sum
of--
``(I) the annual quantity of each
noninnovator multiple source drug
purchased during the cost reporting
period, multiplied by
``(II) the average manufacturer price
for that drug;
``(iii) the reference in clause (i)(II) to
the estimated percentage of the hospital's drug
purchases attributable to Medicaid
beneficiaries for inpatient use shall be equal
to--
``(I) the Medicaid inpatient drug
charges as reported on the hospital's
most recently filed Medicare cost
report, divided by
``(II) total drug charges reported on
the cost report; and
``(iv) the term `noninnovator multiple source
drug' has the meaning given such term in
section 1927(k)(7) of the Social Security Act.
``(3) Calculation of credits.--
``(A) In general.--Each State calculates credits
under paragraph (1) and informs hospitals of amount
under section 1927(a)(5)(D) of the Social Security Act.
``(B) Hospital provision of information.--Not later
than 30 days after the date of the filing of the
hospital's most recently filed Medicare cost report,
the hospital shall provide the State with the
information described in paragraphs (2)(A)(ii) and
(2)(B)(ii). With respect to each drug purchased during
the cost reporting period, the hospital shall provide
the dosage form, strength, package size, date of
purchase, and the number of units purchased.
``(4) Payment deadline.--The credits provided by a hospital
under paragraph (1) shall be paid within 60 days after
receiving the information specified in paragraph (3)(A).
``(5) Opt out.--A hospital shall not be required to provide
the Medicaid credit required under paragraph (1) if it can
demonstrate to the State that it will lose reimbursement under
the State plan resulting from the extension of discounts to
inpatient drugs under subsection (b)(2) and that the loss of
reimbursement will exceed the amount of the credit otherwise
owed by the hospital.
``(6) Offset against medical assistance.--Amounts received by
a State under this subsection in any quarter shall be
considered to be a reduction in the amount expended under the
State plan in the quarter for medical assistance for purposes
of section 1903(a)(1) of the Social Security Act.''.
(c) Conforming Amendments.--Section 1927 of the Social Security Act
(42 U.S.C. 1396r-8) is amended--
(1) in subsection (a)(5)(A), by striking ``covered outpatient
drugs'' and inserting ``covered drugs (as defined in section
340B(b)(2) of the Public Health Service Act)'';
(2) in subsection (a)(5), by striking subparagraph (D) and
inserting the following:
``(D) State responsibility for calculating hospital
credits.--The State shall calculate the credits owed by
the hospital under paragraph (1) of section 340B(c) of
the Public Health Service Act and provide the hospital
with both the amounts and an explanation of how it
calculated the credits. In performing the calculations
specified in paragraphs (2)(A)(ii) and (2)(B)(ii) of
such section, the State shall use the average
manufacturer price applicable to the calendar quarter
in which the drug was purchased by the hospital.''; and
(3) in subsection (k)(1)--
(A) in subparagraph (A), by striking ``subparagraph
(B)'' and inserting ``subparagraphs (B) and (D)''; and
(B) by adding at the end the following:
``(D) Calculation for covered drugs.--With respect to
a covered drug (as defined in section 340B(b)(2) of the
Public Health Service Act), the average manufacturer
price shall be determined in accordance with
subparagraph (A) except that, in the event a covered
drug is not distributed to the retail pharmacy class of
trade, it shall mean the average price paid to the
manufacturer for the drug in the United States by
wholesalers for drugs distributed to the acute care
class of trade, after deducting customary prompt pay
discounts.''.
SEC. 2503. EFFECTIVE DATE.
(a) In General.--The amendments made by this subtitle shall take
effect on July 1, 2010, and shall apply to drugs dispensed on or after
such date.
(b) Effectiveness.--The amendments made by this subtitle shall be
effective, and shall be taken into account in determining whether a
manufacturer is deemed to meet the requirements of section 340B(a) of
the Public Health Service Act (42 U.S.C. 256b(a)) and of section
1927(a)(5) of the Social Security Act (42 U.S.C. 1396r-8(a)(5)),
notwithstanding any other provision of law.
Subtitle B--Programs
PART 1--GRANTS FOR CLINICS AND CENTERS
SEC. 2511. SCHOOL-BASED HEALTH CLINICS.
(a) In General.--Part Q of title III (42 U.S.C. 280h et seq.) is
amended by adding at the end the following:
``SEC. 399Z-1. SCHOOL-BASED HEALTH CLINICS.
``(a) Program.--The Secretary shall establish a school-based health
clinic program consisting of awarding grants to eligible entities to
support the operation of school-based health clinics (referred to in
this section as `SBHCs').
``(b) Eligibility.--To be eligible for a grant under this section, an
entity shall--
``(1) be an SBHC (as defined in subsection (l)(4)); and
``(2) submit an application at such time, in such manner, and
containing such information as the Secretary may require,
including at a minimum--
``(A) evidence that the applicant meets all criteria
necessary to be designated as an SBHC;
``(B) evidence of local need for the services to be
provided by the SBHC;
``(C) an assurance that--
``(i) SBHC services will be provided in
accordance with Federal, State, and local laws;
``(ii) the SBHC has established and maintains
collaborative relationships with other health
care providers in the catchment area of the
SBHC;
``(iii) the SBHC will provide onsite access
during the academic day when school is in
session and has an established network of
support and access to services with backup
health providers when the school or SBHC is
closed;
``(iv) the SBHC will be integrated into the
school environment and will coordinate health
services with appropriate school personnel and
other community providers co-located at the
school; and
``(v) the SBHC sponsoring facility assumes
all responsibility for the SBHC administration,
operations, and oversight; and
``(D) such other information as the Secretary may
require.
``(c) Use of Funds.--Funds awarded under a grant under this section--
``(1) may be used for--
``(A) providing training related to the provision of
comprehensive primary health services and additional
health services;
``(B) the management and operation of SBHC programs;
``(C) the payment of salaries for health
professionals and other appropriate SBHC personnel; and
``(2) may not be used to provide abortions.
``(d) Consideration of Need.--In determining the amount of a grant
under this section, the Secretary shall take into consideration--
``(1) the financial need of the SBHC;
``(2) State, local, or other sources of funding provided to
the SBHC; and
``(3) other factors as determined appropriate by the
Secretary.
``(e) Preferences.--In awarding grants under this section, the
Secretary shall give preference to SBHCs that have a demonstrated
record of service to the following:
``(1) A high percentage of medically underserved children and
adolescents.
``(2) Communities or populations in which children and
adolescents have difficulty accessing health and mental health
services.
``(3) Communities with high percentages of children and
adolescents who are uninsured, underinsured, or eligible for
medical assistance under Federal or State health benefits
programs (including titles XIX and XXI of the Social Security
Act).
``(f) Matching Requirement.--The Secretary may award a grant to an
SBHC under this section only if the SBHC agrees to provide, from non-
Federal sources, an amount equal to 20 percent of the amount of the
grant (which may be provided in cash or in kind) to carry out the
activities supported by the grant.
``(g) Supplement, Not Supplant.--The Secretary may award a grant to
an SBHC under this section only if the SBHC demonstrates to the
satisfaction of the Secretary that funds received through the grant
will be expended only to supplement, and not supplant, non-Federal and
Federal funds otherwise available to the SBHC for operation of the SBHC
(including each activity described in paragraph (1) or (2) of
subsection (c)).
``(h) Payor of Last Resort.--The Secretary may award a grant to an
SBHC under this section only if the SBHC demonstrates to the
satisfaction of the Secretary that funds received through the grant
will not be expended for any activity to the extent that payment has
been made, or can reasonably be expected to be made--
``(1) under any insurance policy;
``(2) under any Federal or State health benefits program
(including titles XIX and XXI of the Social Security Act); or
``(3) by an entity which provides health services on a
prepaid basis.
``(i) Regulations Regarding Reimbursement for Health Services.--The
Secretary shall issue regulations regarding the reimbursement for
health services provided by SBHCs to individuals eligible to receive
such services through the program under this section, including
reimbursement under any insurance policy or any Federal or State health
benefits program (including titles XIX and XXI of the Social Security
Act).
``(j) Technical Assistance.--The Secretary shall provide (either
directly or by grant or contract) technical and other assistance to
SBHCs to assist such SBHCs to meet the requirements of this section.
Such assistance may include fiscal and program management assistance,
training in fiscal and program management, operational and
administrative support, and the provision of information to the SBHCs
of the variety of resources available under this title and how those
resources can be best used to meet the health needs of the communities
served by the SBHCs.
``(k) Evaluation; Report.--The Secretary shall--
``(1) develop and implement a plan for evaluating SBHCs and
monitoring quality performances under the awards made under
this section; and
``(2) submit to the Congress on an annual basis a report on
the program under this section.
``(l) Definitions.--In this section:
``(1) Comprehensive primary health services.--The term
`comprehensive primary health services' means the core services
offered by SBHCs, which shall include the following:
``(A) Physical.--Comprehensive health assessments,
diagnosis, and treatment of minor, acute, and chronic
medical conditions and referrals to, and followup for,
specialty care.
``(B) Mental health.--Mental health assessments,
crisis intervention, counseling, treatment, and
referral to a continuum of services including emergency
psychiatric care, community support programs, inpatient
care, and outpatient programs.
``(C) Optional services.--Additional services, which
may include oral health, social, and age-appropriate
health education services, including nutritional
counseling.
``(2) Medically underserved children and adolescents.--The
term `medically underserved children and adolescents' means a
population of children and adolescents who are residents of an
area designated by the Secretary as an area with a shortage of
personal health services and health infrastructure for such
children and adolescents.
``(3) School-based health clinic.--The term `school-based
health clinic' means a health clinic that--
``(A) is located in, or is adjacent to, a school
facility of a local educational agency;
``(B) is organized through school, community, and
health provider relationships;
``(C) is administered by a sponsoring facility;
``(D) provides, at a minimum, comprehensive primary
health services during school hours to children and
adolescents by health professionals in accordance with
State and local laws and regulations, established
standards, and community practice; and
``(E) does not perform abortion services.
``(4) Sponsoring facility.--The term `sponsoring facility'
is--
``(A) a hospital;
``(B) a public health department;
``(C) a community health center;
``(D) a nonprofit health care agency;
``(E) a local educational agency; or
``(F) a program administered by the Indian Health
Service or the Bureau of Indian Affairs or operated by
an Indian tribe or a tribal organization under the
Indian Self-Determination and Education Assistance Act,
a Native Hawaiian entity, or an urban Indian program
under title V of the Indian Health Care Improvement
Act.
``(m) Authorization of Appropriations.--For purposes of carrying out
this section, there are authorized to be appropriated $50,000,000 for
fiscal year 2010 and such sums as may be necessary for each of the
fiscal years 2011 through 2014.''.
(b) Effective Date.--The Secretary of Health and Human Services shall
begin awarding grants under section 399Z-1 of the Public Health Service
Act, as added by subsection (a), not later than July 1, 2010, without
regard to whether or not final regulations have been issued under
section 399Z-1(i) of such Act.
SEC. 2512. NURSE-MANAGED HEALTH CENTERS.
Title III (42 U.S.C. 241 et seq.) is amended by adding at the end the
following:
``PART S--NURSE-MANAGED HEALTH CENTERS
``SEC. 399GG. NURSE-MANAGED HEALTH CENTERS.
``(a) Program.--The Secretary, acting through the Administrator of
the Health Resources and Services Administration, shall establish a
nurse-managed health center program consisting of awarding grants to
entities under subsection (b).
``(b) Grant.--The Secretary shall award grants to entities--
``(1) to plan and develop a nurse-managed health center; or
``(2) to operate a nurse-managed health center.
``(c) Use of Funds.--Amounts received as a grant under subsection (b)
may be used for activities including the following:
``(1) Purchasing or leasing equipment.
``(2) Training and technical assistance related to the
provision of comprehensive primary care services and wellness
services.
``(3) Other activities for planning, developing, or
operating, as applicable, a nurse-managed health center.
``(d) Assurances Applicable to Both Planning and Operation Grants.--
``(1) In general.--The Secretary may award a grant under this
section to an entity only if the entity demonstrates to the
Secretary's satisfaction that--
``(A) nurses, in addition to managing the center,
will be adequately represented as providers at the
center; and
``(B) not later than 90 days after receiving the
grant, the entity will establish a community advisory
committee composed of individuals, a majority of whom
are being served by the center, to provide input into
the nurse-managed health center's operations.
``(2) Matching requirement.--The Secretary may award a grant
under this section to an entity only if the entity agrees to
provide, from non-Federal sources, an amount equal to 20
percent of the amount of the grant (which may be provided in
cash or in kind) to carry out the activities supported by the
grant.
``(3) Payor of last resort.--The Secretary may award a grant
under this section to an entity only if the entity demonstrates
to the satisfaction of the Secretary that funds received
through the grant will not be expended for any activity to the
extent that payment has been made, or can reasonably be
expected to be made--
``(A) under any insurance policy;
``(B) under any Federal or State health benefits
program (including titles XIX and XXI of the Social
Security Act); or
``(C) by an entity which provides health services on
a prepaid basis.
``(4) Maintenance of effort.--The Secretary may award a grant
under this section to an entity only if the entity demonstrates
to the satisfaction of the Secretary that--
``(A) funds received through the grant will be
expended only to supplement, and not supplant, non-
Federal and Federal funds otherwise available to the
entity for the activities to be funded through the
grant; and
``(B) with respect to such activities, the entity
will maintain expenditures of non-Federal amounts for
such activities at a level not less than the lesser of
such expenditures maintained by the entity for the
fiscal year preceding the fiscal year for which the
entity receives the grant.
``(e) Additional Assurance for Planning Grants.--The Secretary may
award a grant under subsection (b)(1) to an entity only if the entity
agrees--
``(1) to assess the needs of the medically underserved
populations proposed to be served by the nurse-managed health
center; and
``(2) to design services and operations of the nurse-managed
health center for such populations based on such assessment.
``(f) Additional Assurances for Operation Grants.--The Secretary may
award a grant under subsection (b)(2) to an entity only if the entity
assures that the nurse-managed health center will provide--
``(1) comprehensive primary care services, wellness services,
and other health care services deemed appropriate by the
Secretary;
``(2) care without respect to insurance status or income of
the patient; and
``(3) direct access to client-centered services offered by
advanced practice nurses, other nurses, physicians, physician
assistants, or other qualified health professionals.
``(g) Technical Assistance.--The Secretary shall provide (either
directly or by grant or contract) technical and other assistance to
nurse-managed health centers to assist such centers in meeting the
requirements of this section. Such assistance may include fiscal and
program management assistance, training in fiscal and program
management, operational and administrative support, and the provision
of information to nurse-managed health centers regarding the various
resources available under this section and how those resources can best
be used to meet the health needs of the communities served by nurse-
managed health centers.
``(h) Report.--The Secretary shall submit to the Congress an annual
report on the program under this section.
``(i) Definitions.--
``(1) Comprehensive primary care services.--The term
`comprehensive primary care services' has the meaning given to
the term `required primary health services' in section
330(b)(1).
``(2) Medically underserved population.--The term `medically
underserved population' has the meaning given to such term in
section 330(b)(3).
``(3) Nurse-managed health center.--The term `nurse-managed
health center' has the meaning given to such term in section
801.
``(4) Wellness services.--The term `wellness services' means
any health-related service or intervention, not including
primary care, which is designed to reduce identifiable health
risks and increase healthy behaviors intended to prevent the
onset of disease or lessen the impact of existing chronic
conditions by teaching more effective management techniques
that focus on individual self-care and patient-driven
decisionmaking.''.
SEC. 2513. FEDERALLY QUALIFIED BEHAVIORAL HEALTH CENTERS.
(a) Block Grants Regarding Mental Health and Substance Abuse.--
Section 1913 (42 U.S.C. 300x-3) is amended--
(1) in subsection (a)(2)(A), by striking ``community mental
health services'' and inserting ``behavioral health services'';
(2) in subsection (b)--
(A) by striking paragraph (1) and inserting the
following:
``(1) services under the plan will be provided only through
appropriate, qualified community programs (which may include
federally qualified behavioral health centers, child mental
health programs, psychosocial rehabilitation programs, mental
health peer-support programs, and mental health primary
consumer-directed programs); and''; and
(B) in paragraph (2), by striking ``community mental
health centers'' and inserting ``federally qualified
behavioral health centers''; and
(3) by striking subsection (c) and inserting the following:
``(c) Criteria for Federally Qualified Behavioral Health Centers.--
``(1) In general.--The Administrator shall certify, and
recertify at least every 5 years, federally qualified
behavioral health centers as meeting the criteria specified in
this subsection.
``(2) Regulations.--Not later than 18 months after the date
of the enactment of the America's Affordable Health Choices Act
of 2009, the Administrator shall issue final regulations for
certifying centers under paragraph (1).
``(3) Criteria.--The criteria referred to in subsection
(b)(2) are that the center performs each of the following:
``(A) Provide services in locations that ensure
services will be available and accessible promptly and
in a manner which preserves human dignity and assures
continuity of care.
``(B) Provide services in a mode of service delivery
appropriate for the target population.
``(C) Provide individuals with a choice of service
options where there is more than one efficacious
treatment.
``(D) Employ a core staff of clinical staff that is
multidisciplinary and culturally and linguistically
competent.
``(E) Provide services, within the limits of the
capacities of the center, to any individual residing or
employed in the service area of the center.
``(F) Provide, directly or through contract, to the
extent covered for adults in the State Medicaid plan
and for children in accordance with section 1905(r) of
the Social Security Act regarding early and periodic
screening, diagnosis, and treatment, each of the
following services:
``(i) Screening, assessment, and diagnosis,
including risk assessment.
``(ii) Person-centered treatment planning or
similar processes, including risk assessment
and crisis planning.
``(iii) Outpatient clinic mental health
services, including screening, assessment,
diagnosis, psychotherapy, substance abuse
counseling, medication management, and
integrated treatment for mental illness and
substance abuse which shall be evidence-based
(including cognitive behavioral therapy,
dialectical behavioral therapy, motivational
interviewing, and other such therapies which
are evidence-based).
``(iv) Outpatient clinic primary care
services, including screening and monitoring of
key health indicators and health risk
(including screening for diabetes,
hypertension, and cardiovascular disease and
monitoring of weight, height, body mass index
(BMI), blood pressure, blood glucose or HbA1C,
and lipid profile).
``(v) Crisis mental health services,
including 24-hour mobile crisis teams,
emergency crisis intervention services, and
crisis stabilization.
``(vi) Targeted case management (services to
assist individuals gaining access to needed
medical, social, educational, and other
services and applying for income security and
other benefits to which they may be entitled).
``(vii) Psychiatric rehabilitation services
including skills training, assertive community
treatment, family psychoeducation, disability
self-management, supported employment,
supported housing services, therapeutic foster
care services, multisystemic therapy, and such
other evidence-based practices as the Secretary
may require.
``(viii) Peer support and counselor services
and family supports.
``(G) Maintain linkages, and where possible enter
into formal contracts with, inpatient psychiatric
facilities and substance abuse detoxification and
residential programs.
``(H) Make available to individuals served by the
center, directly, through contract, or through linkages
with other programs, each of the following:
``(i) Adult and youth peer support and
counselor services.
``(ii) Family support services for families
of children with serious mental disorders.
``(iii) Other community or regional services,
supports, and providers, including schools,
child welfare agencies, juvenile and criminal
justice agencies and facilities, housing
agencies and programs, employers, and other
social services.
``(iv) Onsite or offsite access to primary
care services.
``(v) Enabling services, including outreach,
transportation, and translation.
``(vi) Health and wellness services,
including services for tobacco cessation.''.
(b) Conforming Amendments.--
(1) Block grants for behavioral health services.--Subpart I
of part B of title XIX (42 U.S.C. 300x-1 et seq.) is amended--
(A) in the subpart heading, by striking ``Community
Mental Health Services'' and inserting ``Behavioral
Mental Health Services'';
(B) in the heading of section 1912, by striking
``COMMUNITY MENTAL HEALTH SERVICES'' and inserting
``BEHAVIORAL MENTAL HEALTH SERVICES''; and
(C) in sections 1912(a)(1), 1912(b), 1915(b)(1), and
1918(a)(8), by striking the term ``community mental
health services'' each place it appears and inserting
``behavioral mental health services''.
(2) Center for mental health services.--Paragraph (13) of
section 520(b) (42 U.S.C. 290bb-31) is amended by striking
``community mental health centers'' and inserting ``federally
qualified behavioral health centers''.
(3) Grants for emergency mental health centers.--Subsection
(b) of section 520F (42 U.S.C. 290bb-37) is amended by striking
``community mental health centers'' and inserting ``federally
qualified behavioral health centers''.
PART 2--OTHER GRANT PROGRAMS
SEC. 2521. COMPREHENSIVE PROGRAMS TO PROVIDE EDUCATION TO NURSES AND
CREATE A PIPELINE TO NURSING.
(a) Purposes.--It is the purpose of this section to authorize grants
to--
(1) address the projected shortage of nurses by funding
comprehensive programs to create a career ladder to nursing
(including certified nurse assistants, licensed practical
nurses, licensed vocational nurses, and registered nurses) for
incumbent ancillary health care workers;
(2) increase the capacity for educating nurses by increasing
both nurse faculty and clinical opportunities through
collaborative programs between staff nurse organizations,
health care providers, and accredited schools of nursing; and
(3) provide training programs through education and training
organizations jointly administered by health care providers and
health care labor organizations or other organizations
representing staff nurses and frontline health care workers,
working in collaboration with accredited schools of nursing and
academic institutions.
(b) Grants.--Not later than 6 months after the date of the enactment
of this Act, the Secretary of Labor (referred to in this section as the
``Secretary'') shall establish a partnership grant program to award
grants to eligible entities to carry out comprehensive programs to
provide education to nurses and create a pipeline to nursing for
incumbent ancillary health care workers who wish to advance their
careers, and to otherwise carry out the purposes of this section.
(c) Eligibility.--To be eligible for a grant under this section, an
entity shall be--
(1) a health care entity that is jointly administered by a
health care employer and a labor union representing the health
care employees of the employer and that carries out activities
using labor management training funds as provided for under
section 302(c)(6) of the Labor Management Relations Act, 1947
(29 U.S.C. 186(c)(6));
(2) an entity that operates a training program that is
jointly administered by--
(A) one or more health care providers or facilities,
or a trade association of health care providers; and
(B) one or more organizations which represent the
interests of direct care health care workers or staff
nurses and in which the direct care health care workers
or staff nurses have direct input as to the leadership
of the organization;
(3) a State training partnership program that consists of
nonprofit organizations that include equal participation from
industry, including public or private employers, and labor
organizations including joint labor-management training
programs, and which may include representatives from local
governments, worker investment agency one-stop career centers,
community-based organizations, community colleges, and
accredited schools of nursing; or
(4) a school of nursing (as defined in section 801 of the
Public Health Service Act (42 U.S.C. 296)).
(d) Additional Requirements for Health Care Employer Described in
Subsection (c).--To be eligible for a grant under this section, a
health care employer described in subsection (c) shall demonstrate that
it--
(1) has an established program within its facility to
encourage the retention of existing nurses;
(2) provides wages and benefits to its nurses that are
competitive for its market or that have been collectively
bargained with a labor organization; and
(3) supports programs funded under this section through 1 or
more of the following:
(A) The provision of paid leave time and continued
health coverage to incumbent health care workers to
allow their participation in nursing career ladder
programs, including certified nurse assistants,
licensed practical nurses, licensed vocational nurses,
and registered nurses.
(B) Contributions to a joint labor-management
training fund which administers the program involved.
(C) The provision of paid release time, incentive
compensation, or continued health coverage to staff
nurses who desire to work full- or part-time in a
faculty position.
(D) The provision of paid release time for staff
nurses to enable them to obtain a bachelor of science
in nursing degree, other advanced nursing degrees,
specialty training, or certification program.
(E) The payment of tuition assistance which is
managed by a joint labor-management training fund or
other jointly administered program.
(e) Other Requirements.--
(1) Matching requirement.--
(A) In general.--The Secretary may not make a grant
under this section unless the applicant involved
agrees, with respect to the costs to be incurred by the
applicant in carrying out the program under the grant,
to make available non-Federal contributions (in cash or
in kind under subparagraph (B)) toward such costs in an
amount equal to not less than $1 for each $1 of Federal
funds provided in the grant. Such contributions may be
made directly or through donations from public or
private entities, or may be provided through the cash
equivalent of paid release time provided to incumbent
worker students.
(B) Determination of amount of non-federal
contribution.--Non-Federal contributions required in
subparagraph (A) may be in cash or in kind (including
paid release time), fairly evaluated, including
equipment or services (and excluding indirect or
overhead costs). Amounts provided by the Federal
Government, or services assisted or subsidized to any
significant extent by the Federal Government, may not
be included in determining the amount of such non-
Federal contributions.
(2) Required collaboration.--Entities carrying out or
overseeing programs carried out with assistance provided under
this section shall demonstrate collaboration with accredited
schools of nursing which may include community colleges and
other academic institutions providing associate, bachelor's, or
advanced nursing degree programs or specialty training or
certification programs.
(f) Use of Funds.--Amounts awarded to an entity under a grant under
this section shall be used for the following:
(1) To carry out programs that provide education and training
to establish nursing career ladders to educate incumbent health
care workers to become nurses (including certified nurse
assistants, licensed practical nurses, licensed vocational
nurses, and registered nurses). Such programs shall include one
or more of the following:
(A) Preparing incumbent workers to return to the
classroom through English-as-a-second language
education, GED education, precollege counseling,
college preparation classes, and support with entry
level college classes that are a prerequisite to
nursing.
(B) Providing tuition assistance with preference for
dedicated cohort classes in community colleges,
universities, and accredited schools of nursing with
supportive services including tutoring and counseling.
(C) Providing assistance in preparing for and meeting
all nursing licensure tests and requirements.
(D) Carrying out orientation and mentorship programs
that assist newly graduated nurses in adjusting to
working at the bedside to ensure their retention
postgraduation, and ongoing programs to support nurse
retention.
(E) Providing stipends for release time and continued
health care coverage to enable incumbent health care
workers to participate in these programs.
(2) To carry out programs that assist nurses in obtaining
advanced degrees and completing specialty training or
certification programs and to establish incentives for nurses
to assume nurse faculty positions on a part-time or full-time
basis. Such programs shall include one or more of the
following:
(A) Increasing the pool of nurses with advanced
degrees who are interested in teaching by funding
programs that enable incumbent nurses to return to
school.
(B) Establishing incentives for advanced degree
bedside nurses who wish to teach in nursing programs so
they can obtain a leave from their bedside position to
assume a full- or part-time position as adjunct or
full-time faculty without the loss of salary or
benefits.
(C) Collaboration with accredited schools of nursing
which may include community colleges and other academic
institutions providing associate, bachelor's, or
advanced nursing degree programs, or specialty training
or certification programs, for nurses to carry out
innovative nursing programs which meet the needs of
bedside nursing and health care providers.
(g) Preference.--In awarding grants under this section the Secretary
shall give preference to programs that--
(1) provide for improving nurse retention;
(2) provide for improving the diversity of the new nurse
graduates to reflect changes in the demographics of the patient
population;
(3) provide for improving the quality of nursing education to
improve patient care and safety;
(4) have demonstrated success in upgrading incumbent health
care workers to become nurses or which have established
effective programs or pilots to increase nurse faculty; or
(5) are modeled after or affiliated with such programs
described in paragraph (4).
(h) Evaluation.--
(1) Program evaluations.--An entity that receives a grant
under this section shall annually evaluate, and submit to the
Secretary a report on, the activities carried out under the
grant and the outcomes of such activities. Such outcomes may
include--
(A) an increased number of incumbent workers entering
an accredited school of nursing and in the pipeline for
nursing programs;
(B) an increasing number of graduating nurses and
improved nurse graduation and licensure rates;
(C) improved nurse retention;
(D) an increase in the number of staff nurses at the
health care facility involved;
(E) an increase in the number of nurses with advanced
degrees in nursing;
(F) an increase in the number of nurse faculty;
(G) improved measures of patient quality (which may
include staffing ratios of nurses, patient satisfaction
rates, and patient safety measures); and
(H) an increase in the diversity of new nurse
graduates relative to the patient population.
(2) General report.--Not later than 2 years after the date of
the enactment of this Act, and annually thereafter, the
Secretary of Labor shall, using data and information from the
reports received under paragraph (1), submit to the Congress a
report concerning the overall effectiveness of the grant
program carried out under this section.
(i) Authorization of Appropriations.--There are authorized to be
appropriated to carry out this section such sums as may be necessary.
SEC. 2522. MENTAL AND BEHAVIORAL HEALTH TRAINING.
Part E of title VII (42 U.S.C. 294n et seq.) is amended by adding at
the end the following:
``Subpart 3--Mental and Behavioral Health Training
``SEC. 775. MENTAL AND BEHAVIORAL HEALTH TRAINING PROGRAM.
``(a) Program.--The Secretary shall establish an interdisciplinary
mental and behavioral health training program consisting of awarding
grants and contracts under subsection (b).
``(b) Support and Development of Mental and Behavioral Health
Training Programs.--The Secretary shall make grants to, or enter into
contracts with, eligible entities--
``(1) to plan, develop, operate, or participate in an
accredited professional training program for mental and
behavioral health professionals to promote--
``(A) interdisciplinary training; and
``(B) coordination of the delivery of health care
within and across settings, including health care
institutions, community-based settings, and the
patient's home;
``(2) to provide financial assistance to mental and
behavioral health professionals, who are participants in any
such program, and who plan to work in the field of mental and
behavioral health;
``(3) to plan, develop, operate, or participate in an
accredited program for the training of mental and behavioral
health professionals who plan to teach in the field of mental
and behavioral health; and
``(4) to provide financial assistance in the form of
traineeships and fellowships to mental and behavioral health
professionals who are participants in any such program and who
plan to teach in the field of mental and behavioral health.
``(c) Eligibility.--To be eligible for a grant or contract under
subsection (b), an entity shall be--
``(1) an accredited health professions school, including an
accredited school or program of psychology, psychiatry, social
work, marriage and family therapy, professional mental health
and substance abuse counseling, or addiction medicine;
``(2) an accredited public or nonprofit private hospital;
``(3) a public or private nonprofit entity; or
``(4) a consortium of 2 or more entities described in
paragraphs (1) through (3).
``(d) Preference.--In awarding grants or contracts under this
section, the Secretary shall give preference to entities that have a
demonstrated record of the following:
``(1) Training the greatest percentage, or significantly
improving the percentage, of health professionals who serve in
underserved communities.
``(2) Supporting teaching programs that address the health
care needs of vulnerable populations.
``(3) Training individuals who are from underrepresented
minority groups or disadvantaged backgrounds.
``(4) Training individuals who serve geriatric populations
with an emphasis on underserved elderly.
``(5) Training individuals who serve pediatric populations
with an emphasis on underserved children.
``(e) Report.--The Secretary shall submit to the Congress an annual
report on the program under this section.
``(f) Definition.--In this section:
``(1) The term `health disparities' has the meaning given the
term in section 3171.
``(2) The term `mental and behavioral health professional'
means an individual training or practicing--
``(A) in psychology; general, geriatric, child or
adolescent psychiatry; social work; marriage and family
therapy; professional mental health and substance abuse
counseling; or addiction medicine; or
``(B) another mental and behavioral health specialty,
as deemed appropriate by the Secretary.
``(3) The term `interdisciplinary' means collaboration across
health professions, specialties, and subspecialties, which may
include public health, nursing, allied health, and appropriate
medical specialties.
``(g) Authorization of Appropriations.--To carry out this section,
there is authorized to be appropriated $60,000,000 for each of fiscal
years 2010 through 2014. Of the amounts appropriated to carry out this
section for a fiscal year, not less than 15 percent shall be used for
training programs in psychology.''.
SEC. 2523. PROGRAMS TO INCREASE AWARENESS OF ADVANCE CARE PLANNING
ISSUES.
Title III (42 U.S.C. 241 et seq.), as amended, is amended by adding
at the end the following:
``PART T--PROGRAMS TO INCREASE AWARENESS OF ADVANCE CARE PLANNING
ISSUES
``SEC. 399HH. ADVANCE CARE PLANNING EDUCATION CAMPAIGNS AND INFORMATION
PHONE LINE AND CLEARINGHOUSE.
``(a) Advance Care Planning Education Campaign.--The Secretary shall,
directly or through grants awarded under subsection (c), conduct a
national public education campaign--
``(1) to raise public awareness of the importance of planning
for care near the end of life;
``(2) to improve the public's understanding of the various
situations in which individuals may find themselves if they
become unable to express their health care wishes;
``(3) to explain the need for readily available legal
documents that express an individual's wishes through--
``(A) advance directives (including living wills,
comfort care orders, and durable powers of attorney for
health care); and
``(B) other planning tools, such as a physician's
orders for life-sustaining treatment (POLST); and
``(4) to educate the public about the availability of hospice
care and palliative care.
``(b) Information Phone Line and Clearinghouse.--The Secretary,
directly or through grants awarded under subsection (c), shall provide
for the establishment of a national, toll-free, information telephone
line and a clearinghouse that the public and health professionals may
access to find out about State-specific and other information regarding
advance directive and end-of-life decisions.
``(c) Grants.--
``(1) In general.--The Secretary shall use funds appropriated
under subsection (d) for the purpose of awarding grants to
public or nonprofit private entities (including States or
political subdivisions of a State), or a consortium of any of
such entities, for the purpose of conducting education
campaigns under subsection (a).
``(2) Limitation on eligibility.--Any grant awarded under
this Act shall not go to any governmental or nongovernmental
organization that promotes suicide, assisted suicide, or the
active hastening of death. Nothing in the previous clause shall
be construed to prohibit palliative or hospice care.
``(3) Period.--Any grant awarded under paragraph (1) shall be
for a period of 3 years.
``(d) Authorization of Appropriations.--There are authorized to be
appropriated--
``(1) for purposes of carrying out subsection (b), $5,000,000
for fiscal year 2010 and each subsequent year; and
``(2) for purposes of making grants under subsection (c),
$10,000,000 for fiscal year 2010, to remain available until
expended.''.
SEC. 2524. REAUTHORIZATION OF TELEHEALTH AND TELEMEDICINE GRANT
PROGRAMS.
(a) Telehealth Network and Telehealth Resource Centers Grant
Programs.--Section 330I (42 U.S.C. 254c-14) is amended--
(1) in subsection (a)--
(A) by striking paragraph (3) (relating to frontier
communities); and
(B) by inserting after paragraph (2) the following:
``(3) Health disparities.--The term `health disparities' has
the meaning given such term in section 3171.'';
(2) in subsection (d)(1)--
(A) in subparagraph (B), by striking ``and'' at the
end;
(B) in subparagraph (C), by striking the period at
the end and inserting ``; and''; and
(C) by adding at the end the following:
``(D) reduce health disparities.'';
(3) in subsection (f)(1)(B)(iii)--
(A) in subclause (VII), by inserting ``, including
skilled nursing facilities'' before the period at the
end;
(B) in subclause (IX), by inserting ``, including
county mental health and public mental health
facilities'' before the period at the end; and
(C) by adding at the end the following:
``(XIII) Renal dialysis
facilities.'';
(4) by amending subsection (i) to read as follows:
``(i) Preferences.--
``(1) Telehealth networks.--In awarding grants under
subsection (d)(1) for projects involving telehealth networks,
the Secretary shall give preference to eligible entities
meeting the following:
``(A) Network.--The eligible entity is a health care
provider in, or proposing to form, a health care
network that furnishes services in a medically
underserved area or a health professional shortage
area.
``(B) Broad geographic coverage.--The eligible entity
demonstrates broad geographic coverage in the rural or
medically underserved areas of the State or States in
which the entity is located.
``(C) Health disparities.--The eligible entity
demonstrates how the project to be funded through the
grant will address health disparities.
``(D) Linkages.--The eligible entity agrees to use
the grant to establish or develop plans for telehealth
systems that will link rural hospitals and rural health
care providers to other hospitals, health care
providers, and patients.
``(E) Efficiency.--The eligible entity agrees to use
the grant to promote greater efficiency in the use of
health care resources.
``(F) Viability.--The eligible entity demonstrates
the long-term viability of projects through--
``(i) availability of non-Federal funding
sources; or
``(ii) institutional and community support
for the telehealth network.
``(G) Services.--The eligible entity provides a plan
for coordinating system use by eligible entities and
prioritizes use of grant funds for health care services
over nonclinical uses.
``(2) Telehealth resource centers.--In awarding grants under
subsection (d)(2) for projects involving telehealth resource
centers, the Secretary shall give preference to eligible
entities meeting the following:
``(A) Provision of a broad range of services.--The
eligible entity has a record of success in the
provision of a broad range of telehealth services to
medically underserved areas or populations.
``(B) Provision of telehealth technical assistance.--
The eligible entity has a record of success in the
provision of technical assistance to providers serving
medically underserved communities or populations in the
establishment and implementation of telehealth
services.
``(C) Collaboration and sharing of expertise.--The
eligible entity has a demonstrated record of
collaborating and sharing expertise with providers of
telehealth services at the national, regional, State,
and local levels.'';
(5) in subsection (j)(2)(B), by striking ``such projects for
fiscal year 2001'' and all that follows through the period and
inserting ``such project for fiscal year 2009.'';
(6) in subsection (k)(1)--
(A) in subparagraph (E)(i), by striking
``transmission of medical data'' and inserting
``transmission and electronic archival of medical
data''; and
(B) by amending subparagraph (F) to read as follows:
``(F) developing projects to use telehealth
technology--
``(i) to facilitate collaboration between
health care providers;
``(ii) to promote telenursing services; or
``(iii) to promote patient understanding and
adherence to national guidelines for chronic
disease and self-management of such
conditions;'';
(7) in subsection (q), by striking ``Not later than September
30, 2005'' and inserting ``Not later than 1 year after the date
of the enactment of the America's Affordable Health Choices Act
of 2009, and annually thereafter'';
(8) by striking subsection (r);
(9) by redesignating subsection (s) as subsection (r); and
(10) in subsection (r) (as so redesignated)--
(A) in paragraph (1)--
(i) by striking ``and'' before ``such sums'';
and
(ii) by inserting ``, $10,000,000 for fiscal
year 2010, and such sums as may be necessary
for each of fiscal years 2011 through 2014''
before the semicolon; and
(B) in paragraph (2)--
(i) by striking ``and'' before ``such sums'';
and
(ii) by inserting ``, $10,000,000 for fiscal
year 2010, and such sums as may be necessary
for each of fiscal years 2011 through 2014''
before the period.
(b) Telemedicine; Incentive Grants Regarding Coordination Among
States.--Subsection (b) of section 330L (42 U.S.C. 254c-18) is amended
by inserting ``, $10,000,000 for fiscal year 2010, and such sums as may
be necessary for each of fiscal years 2011 through 2014'' before the
period at the end.
SEC. 2525. NO CHILD LEFT UNIMMUNIZED AGAINST INFLUENZA: DEMONSTRATION
PROGRAM USING ELEMENTARY AND SECONDARY SCHOOLS AS
INFLUENZA VACCINATION CENTERS.
(a) Purpose.--The Secretary of Health and Human Services, in
consultation with the Secretary of Education and the Secretary of
Labor, shall award grants to eligible partnerships to carry out
demonstration programs designed to test the feasibility of using the
Nation's elementary schools and secondary schools as influenza
vaccination centers.
(b) In General.--The Secretary shall coordinate with the Secretary of
Labor, the Secretary of Education, State Medicaid agencies, State
insurance agencies, and private insurers to carry out a program
consisting of awarding grants under subsection (c) to ensure that
children have coverage for all reasonable and customary expenses
related to influenza vaccinations, including the costs of purchasing
and administering the vaccine incurred when influenza vaccine is
administered outside of the physician's office in a school or other
related setting.
(c) Program Description.--
(1) Grants.--From amounts appropriated pursuant to subsection
(l), the Secretary shall award grants to eligible partnerships
to be used to provide influenza vaccinations to children in
elementary and secondary schools, in coordination with school
nurses, school health care programs, community health care
providers, State insurance agencies, or private insurers.
(2) ACIP recommendations.--The program under this section
shall be designed to administer vaccines consistent with the
recommendations of the Centers for Disease Control and
Prevention's Advisory Committee on Immunization Practices
(ACIP) for the annual vaccination of all children 5 through 19
years of age.
(3) Participation voluntary.--Participation by a school or an
individual shall be voluntary.
(d) Use of Funds.--Eligible partnerships receiving a grant under this
section shall ensure the maximum number of children access influenza
vaccinations as follows:
(1) Covered children.--To the extent to which payment of the
costs of purchasing and administering the influenza vaccine for
children is not covered through other federally funded programs
or through private insurance, eligible partnerships receiving a
grant shall use funds to purchase and administer influenza
vaccinations.
(2) Children covered by other federal programs.--For children
who are eligible under other federally funded programs for
payment of the costs of purchasing and administering the
influenza vaccine, eligible partnerships receiving a grant
shall not use funds provided under this section for such costs.
(3) Children covered by private health insurance.--For
children who have private insurance, eligible partnerships
receiving a grant shall offer assistance in accessing coverage
for vaccinations administered through the program under this
section.
(e) Privacy.--The Secretary shall ensure that the program under this
section adheres to confidentiality and privacy requirements of section
264 of the Health Insurance Portability and Accountability Act of 1996
(42 U.S.C. 1320d-2 note) and section 444 of the General Education
Provisions Act (20 U.S.C. 1232g; commonly referred to as the ``Family
Educational Rights and Privacy Act of 1974'').
(f) Application.--An eligible partnership desiring a grant under this
section shall submit an application to the Secretary at such time, in
such manner, and containing such information as the Secretary may
require.
(g) Duration.--Eligible partnerships receiving a grant shall
administer a demonstration program funded through this section over a
period of 2 consecutive school years.
(h) Choice of Vaccine.--The program under this section shall not
restrict the discretion of a health care provider to administer any
influenza vaccine approved by the Food and Drug Administration for use
in pediatric populations.
(i) Awards.--The Secretary shall award--
(1) a minimum of 10 grants in 10 different States to eligible
partnerships that each include one or more public schools
serving primarily low-income students; and
(2) a minimum of 5 grants in 5 different States to eligible
partnerships that each include one or more public schools
located in a rural local education agency.
(j) Report.--Not later than 90 days following the completion of the
program under this section, the Secretary shall submit to the
Committees on Education and Labor, Energy and Commerce, and
Appropriations of the House of Representatives and to the Committees on
Health, Education, Labor, and Pensions and Appropriations of the Senate
a report on the results of the program. The report shall include--
(1) an assessment of the influenza vaccination rates of
school-age children in localities where the program is
implemented, compared to the national average influenza
vaccination rates for school-aged children, including whether
school-based vaccination assists in achieving the
recommendations of the Advisory Committee on Immunization
Practices for annual influenza vaccination of all children 6
months to 18 years of age;
(2) an assessment of the utility of employing elementary
schools and secondary schools as a part of a multistate,
community-based pandemic response program that is consistent
with existing Federal and State pandemic response plans;
(3) an assessment of the feasibility of using existing
Federal and private insurance funding in establishing a
multistate, school-based vaccination program for seasonal
influenza vaccination;
(4) an assessment of the number of education days gained by
students as a result of seasonal vaccinations based on
absenteeism rates;
(5) a determination of whether the program under this
section--
(A) increased vaccination rates in the participating
localities; and
(B) was implemented for sufficient time for gathering
enough valid data; and
(6) a recommendation on whether the program should be
continued, expanded, or terminated.
(k) Definitions.--In this section:
(1) Eligible partnership.--The term ``eligible partnership''
means a local public health department, or another health
organization defined by the Secretary as eligible to submit an
application, and one or more elementary and secondary schools.
(2) Elementary school.--The terms ``elementary school''' and
``secondary school'' have the meanings given such terms in
section 9101 of the Elementary and Secondary Education Act of
1965 (20 U.S.C. 7801).
(3) Low-income.--The term ``low-income'' means a student, age
5 through 19, eligible for free or reduced-price lunch under
the National School Lunch Act (42 U.S.C. 1751 et seq.).
(4) Rural local educational agency.--The term ``rural local
educational agency'' means an eligible local educational agency
described in section 6211(b)(1) of the Elementary and Secondary
Education Act of 1965 (20 U.S.C. 7345(b)(1)).
(5) Secretary.--Except as otherwise specified, the term
``Secretary'' means the Secretary of Health and Human Services.
(l) Authorization of Appropriations.--To carry out this section,
there are authorized to be appropriated such sums as may be necessary.
SEC. 2526. EXTENSION OF WISEWOMAN PROGRAM.
Section 1509 of the Public Health Service Act (42 U.S.C. 300n-4a) is
amended--
(1) in subsection (a)--
(A) by striking the heading and inserting ``In
General.--''; and
(B) in the matter preceding paragraph (1), by
striking ``may make grants'' and all that follows
through ``purpose'' and inserting the following: ``may
make grants to such States for the purpose''; and
(2) in subsection (d)(1), by striking ``there are
authorized'' and all that follows through the period and
inserting ``there are authorized to be appropriated $70,000,000
for fiscal year 2010, $73,500,000 for fiscal year 2011,
$77,000,000 for fiscal year 2012, $81,000,000 for fiscal year
2013, and $85,000,000 for fiscal year 2014.''.
SEC. 2527. HEALTHY TEEN INITIATIVE TO PREVENT TEEN PREGNANCY.
Part B of title III (42 U.S.C. 243 et seq.) is amended by inserting
after section 317T the following:
``SEC. 317U. HEALTHY TEEN INITIATIVE TO PREVENT TEEN PREGNANCY.
``(a) Program.--To the extent and in the amount of appropriations
made in advance in appropriations Acts, the Secretary, acting through
the Director of the Centers for Disease Control and Prevention, shall
establish a program consisting of making grants, in amounts determined
under subsection (c), to each State that submits an application in
accordance with subsection (d) for an evidence-based education program
described in subsection (b).
``(b) Use of Funds.--Amounts received by a State under this section
shall be used to conduct or support evidence-based education programs
(directly or through grants or contracts to public or private nonprofit
entities, including schools and community-based and faith-based
organizations) to reduce teen pregnancy or sexually transmitted
diseases.
``(c) Distribution of Funds.--The Director shall, for fiscal year
2010 and each subsequent fiscal year, make a grant to each State
described in subsection (a) in an amount equal to the product of--
``(1) the amount appropriated to carry out this section for
the fiscal year; and
``(2) the percentage determined for the State under section
502(c)(1)(B)(ii) of the Social Security Act.
``(d) Application.--To seek a grant under this section, a State shall
submit an application at such time, in such manner, and containing such
information and assurance of compliance with this section as the
Secretary may require. At a minimum, an application shall to the
satisfaction of the Secretary--
``(1) describe how the State's proposal will address the
needs of at-risk teens in the State;
``(2) identify the evidence-based education program or
programs selected from the registry developed under subsection
(g) that will be used to address risks in priority populations;
``(3) describe how the program or programs will be
implemented and any adaptations to the evidence-based model
that will be made;
``(4) list any private and public entities with whom the
State proposes to work, including schools and community-based
and faith-based organizations, and demonstrate their capacity
to implement the proposed program or programs; and
``(5) identify an independent entity that will evaluate the
impact of the program or programs.
``(e) Evaluation.--
``(1) Requirement.--As a condition on receipt of a grant
under this section, a State shall agree--
``(A) to arrange for an independent evaluation of the
impact of the programs to be conducted or supported
through the grant; and
``(B) submit reports to the Secretary on such
programs and the results of evaluation of such
programs.
``(2) Funding limitation.--Of the amounts made available to a
State through a grant under this section for any fiscal year,
not more than 10 percent may be used for such evaluation.
``(f) Rule of Construction.--This section shall not be construed to
preempt or limit any State law regarding parental involvement and
decisionmaking in children's education.
``(g) Registry of Eligible Programs.--The Secretary shall develop not
later than 180 days after the date of the enactment of the America's
Affordable Health Choices Act of 2009, and periodically update
thereafter, a publicly available registry of programs described in
subsection (b) that, as determined by the Secretary--
``(1) meet the definition of the term `evidence-based' in
subsection (i);
``(2) are medically and scientifically accurate; and
``(3) provide age-appropriate information.
``(h) Matching Funds.--The Secretary may award a grant to a State
under this section for a fiscal year only if the State agrees to
provide, from non-Federal sources, an amount equal to $1 (in cash or in
kind) for each $4 provided through the grant to carry out the
activities supported by the grant.
``(i) Definition.--In this section, the term `evidence-based' means
based on a model that has been found, in methodologically sound
research--
``(1) to delay initiation of sex;
``(2) to decrease number of partners;
``(3) to reduce teen pregnancy;
``(4) to reduce sexually transmitted infection rates; or
``(5) to improve rates of contraceptive use.
``(j) Appropriations.--To carry out this section, there is authorized
to be appropriated $50,000,000 for each of the fiscal years 2010
through 2014.''.
SEC. 2528. NATIONAL TRAINING INITIATIVE ON AUTISM SUPPLEMENTAL GRANTS
AND TECHNICAL ASSISTANCE.
Part R of title III (42 U.S.C. 280i et seq.) is amended--
(1) by inserting after the header for part R the following:
``Subpart 1--Surveillance and Research Program; Education, Early
Detection, and Intervention; and Reporting'';
(2) in section 399AA(d), by striking ``part'' and inserting
``subpart''; and
(3) by adding at the end the following:
``Subpart 2--National Training Initiative
``SEC. 399FF. NATIONAL TRAINING INITIATIVE.
``(a) National Training Initiative Supplemental Grants and Technical
Assistance.--
``(1) Supplemental grants.--
``(A) In general.--The Secretary shall award, in
consultation with the Interagency Autism Coordinating
Committee, multiyear national training initiative
supplemental grants to University Centers for
Excellence in Developmental Disabilities authorized by
the Developmental Disabilities Assistance and Bill of
Rights Act of 2000, public or private nonprofit
entities, and other comparable interdisciplinary
service, training, and academic entities to provide
interdisciplinary training, continuing education
initiatives, technical assistance, dissemination, and
services to address the unmet needs of children and
adults with autism spectrum disorders and related
developmental disabilities, and their families.
``(B) Requirements.--A University Center for
Excellence in Developmental Disabilities that desires
to receive a grant under this paragraph shall submit to
the Secretary an application containing such agreements
and information as the Secretary may require, including
agreements that the training program shall--
``(i) provide trainees with an appropriate
balance of interdisciplinary academic and
community-based experiences;
``(ii) have a demonstrated capacity to
provide training and technical assistance in
evidence-based practices to evaluate, and
provide effective interventions, treatment,
services, and supports to children and adults
with autism and related developmental
disabilities, and their families;
``(iii) have a demonstrated capacity to
include persons with autism spectrum disorders,
parents, and family members as part of the
training program to ensure that a person and
family-centered approach is used;
``(iv) provide to the Secretary, in the
manner prescribed by the Secretary, data
regarding the number of persons who have
benefitted and outcomes of the provision of
training and technical assistance;
``(v) demonstrate a capacity to share and
disseminate materials and practices that are
developed and evaluated to be effective in the
provision of training and technical assistance;
``(vi) provide assurances that training,
technical assistance, dissemination, and
services performed under grants made pursuant
to this paragraph shall be consistent with the
goals of the Developmental Disabilities Act of
1984, the Americans with Disabilities Act of
1990, the Individuals with Disabilities
Education Act, and the No Child Left Behind Act
of 2001 and conducted in coordination with
other relevant State agencies, other
institutions of higher education, and service
providers; and
``(vii) have a demonstrated capacity to
provide training, technical assistance,
supports, and services under this section
statewide.
``(C) Activities.--A University Center for Excellence
in Developmental Disabilities, or other eligible entity
that receives a grant under this paragraph shall expand
and develop interdisciplinary training and continuing
education initiatives for parents, health, allied
health, vocational, educational, and other
professionals and develop model services and supports
that demonstrate evidence-based practices, by engaging
in the following activities:
``(i) Training health, allied health,
vocational, and educational professionals to
identify, evaluate the needs, and develop
treatments, interventions, services, and
supports for children and adults with, autism
spectrum disorder and related developmental
disabilities.
``(ii) Developing systems and products that
allow for the interventions, services and
supports to be evaluated for fidelity of
implementation.
``(iii) Working to expand the availability of
evidence-based, lifelong interventions,
educational, employment, and transition
services, and community supports.
``(iv) Providing statewide technical
assistance in collaboration with relevant State
agencies, other institutions of higher
education, autism spectrum disorder advocacy
groups, and community-based service providers.
``(v) Working to develop comprehensive
systems of supports and services for
individuals with autism and related
developmental disabilities and their families,
including seamless transitions between
educational and health systems across the
lifespan.
``(vi) Promoting training, technical
assistance, dissemination, supports, and
services.
``(vii) Developing mechanisms to provide
training and technical assistance, including
for-credit courses, intensive summer
institutes, continuing education programs,
distance based programs, and Web-based
information dissemination strategies.
``(viii) Promoting activities that support
community-based family and individual services
and enable individuals with autism and related
developmental disabilities to fully participate
in society and achieve good quality of life
outcomes.
``(ix) Collecting data on the outcomes of
training and technical assistance programs to
meet statewide needs for the expansion of
services to children and adults with autism
spectrum disorders and related developmental
disabilities.
``(2) Technical assistance.--The Secretary shall reserve 2
percent of the appropriated funds to make a grant to a national
organization with demonstrated capacity for proving training
and technical assistance to University Centers for Excellence
in Developmental Disabilities to--
``(A) assist in national dissemination of specific
information, including evidence-based best practices,
from interdisciplinary training programs, and when
appropriate, other entities whose findings would inform
the work performed by entities awarded grants;
``(B) compile and disseminate strategies and
materials that prove to be effective in the provision
of training and technical assistance so that the entire
network can benefit from the models, materials, and
practices developed in individual centers;
``(C) assist in the coordination of activities of
grantees under this section;
``(D) develop a Web portal that will provide linkages
to each of the individual training initiatives and
provide access to training modules, promising training,
and technical assistance practices and other materials
developed by grantees;
``(E) serve as a research-based resource for Federal
and State policymakers on information concerning the
provision of training and technical assistance for the
assessment, and provision of supports and services for
children and adults with autism spectrum disorders and
related developmental disabilities;
``(F) convene experts from multiple interdisciplinary
training programs, individuals with autism spectrum
disorders, and their families to discuss and make
recommendations with regard to training issues related
to the assessment, and treatment, interventions,
supports, and services for children and adults with
autism spectrum disorders and related developmental
disorders; and
``(G) undertake any other functions that the
Secretary determines to be appropriate.
``(3) Authorization of appropriations.--
``(A) In general.--Subject to subparagraph (B), there
is authorized to be appropriated to carry out this
subsection $17,000,000 for fiscal year 2011 to be
equally divided among existing University Centers for
Excellence in Developmental Disabilities and such sums
for fiscal years 2012 through 2015 in the case of
University Centers for Excellence in Developmental
Disabilities located in American Samoa or the
Commonwealth of the Northern Mariana Islands,
supplemental grants of not less than $100,000.
``(B) Appropriations less than $17,000,000.--With
respect to any fiscal year in which the amount
appropriated under subsection (A) to carry out this
section is less than $17,000,000, the Secretary shall
make competitive grants from such amount to individual
University Centers for Excellence in Developmental
Disabilities but would not be less than $250,000 per
individual grant, in the case of University Centers for
Excellence for Developmental Disabilities located in
American Samoa or the Commonwealth of the Northern
Mariana Islands, supplemental grants of not less than
$100,000.
``(C) Reservation.--Not more than 2 percent of the
amount appropriated under subparagraphs (A) or (B)
shall be reserved to carry out paragraph (2).
``(b) Expansion of the Number of University Centers for Excellence in
Developmental Disabilities Research, Education, and Services.--
``(1) Purpose.--The Secretary shall award up to four
additional grants for the University Centers for Excellence in
Developmental Disabilities for the purpose of expanding the
capacity of existing national network and enhance the number of
training facilities serving minority institutions with a
primary focus on autism spectrum disorder and related
developmental disabilities. Such centers shall--
``(A) train health, allied health, and educational
professionals to identify, diagnose, treat, and provide
services for individuals with autism spectrum
disorders;
``(B) provide services, including early
identification, diagnosis, and intervention for
individuals with autism spectrum disorders; and
``(C) provide other training and technical
assistance, as necessary.
``(2) Priority.--The Secretary shall give priority to
establishing such centers in--
``(A) minority-serving institutions that have
demonstrated capacity to meet the requirements to
qualify as a University Center for Excellence in
Developmental Disabilities and provide services to
individuals with autism spectrum disorders; or
``(B) States with underserved populations.
``(3) Authorization of appropriations.--There is authorized
to be appropriated to carry out this subsection $2,000,000 for
each of the fiscal years 2011 through 2015.''.
SEC. 2529. IMPLEMENTATION OF MEDICATION MANAGEMENT SERVICES IN
TREATMENT OF CHRONIC DISEASES.
(a) In General.--The Secretary of Health and Human Services (referred
to in this section as the ``Secretary''), acting through the Director
of the Agency for Health Care Research and Quality, shall establish a
program to provide grants to eligible entities to implement medication
management services (referred to in this section as ``MTM services'')
provided by licensed pharmacists, as a part of a collaborative,
multidisciplinary, interprofessional approach to the treatment of
chronic diseases for targeted individuals, to improve the quality of
care and reduce overall cost in the treatment of such diseases. The
Secretary shall commence the grant program not later than May 1, 2010.
(b) Eligible Entities.--To be eligible to receive a grant under
subsection (a), an entity shall--
(1) provide a setting appropriate for MTM services, as
recommended by the experts described in subsection (e);
(2) submit to the Secretary a plan for achieving long-term
financial sustainability;
(3) where applicable, submit a plan for coordinating MTM
services with other local providers and where applicable,
through or in collaboration with the Medicare Medical Home
Pilot program as established by section 1866F of the Social
Security Act, as added by section 1302(a) of this Act;
(4) submit a plan for meeting the requirements under
subsection (c); and
(5) submit to the Secretary such other information as the
Secretary may require.
(c) MTM Services to Targeted Individuals.--The MTM services provided
with the assistance of a grant awarded under subsection (a) shall, as
allowed by State law (including applicable collaborative pharmacy
practice agreements), include--
(1) performing or obtaining necessary assessments of the
health and functional status of each patient receiving such MTM
services;
(2) formulating a medication treatment plan according to
therapeutic goals agreed upon by the prescriber and the patient
or caregiver or authorized representative of the patient;
(3) selecting, initiating, modifying, recommending changes
to, or administering medication therapy;
(4) monitoring, which may include access to, ordering, or
performing laboratory assessments, and evaluating the response
of the patient to therapy, including safety and effectiveness;
(5) performing an initial comprehensive medication review to
identify, resolve, and prevent medication-related problems,
including adverse drug events, quarterly targeted medication
reviews for ongoing monitoring, and additional follow-up
interventions on a schedule developed collaboratively with the
prescriber;
(6) documenting the care delivered and communicating
essential information about such care (including a summary of
the medication review) and the recommendations of the
pharmacist to other appropriate health care providers of the
patient in a timely fashion;
(7) providing education and training designed to enhance the
understanding and appropriate use of the medications by the
patient, caregiver, and other authorized representative;
(8) providing information, support services, and resources
and strategies designed to enhance patient adherence with
therapeutic regimens;
(9) coordinating and integrating MTM services within the
broader health care management services provided to the
patient; and
(10) such other patient care services as are allowed under
the scopes of practice for pharmacists for purposes of other
Federal programs.
(d) Targeted Individuals.--MTM services provided by licensed
pharmacists under a grant awarded under subsection (a) shall be offered
to targeted individuals who--
(1) take 4 or more prescribed medications (including over-
the-counter and dietary supplements);
(2) take any high-risk medications;
(3) have 2 or more chronic diseases, as identified by the
Secretary; or
(4) have undergone a transition of care, or other factors, as
determined by the Secretary, that are likely to create a high
risk of medication-related problems.
(e) Consultation With Experts.--In designing and implementing MTM
services provided under grants awarded under subsection (a), the
Secretary shall consult with Federal, State, private, public-private,
and academic entities, pharmacy and pharmacist organizations, health
care organizations, consumer advocates, chronic disease groups, and
other stakeholders involved with the research, dissemination, and
implementation of pharmacist-delivered MTM services, as the Secretary
determines appropriate. The Secretary, in collaboration with this
group, shall determine whether it is possible to incorporate rapid
cycle process improvement concepts in use in other Federal programs
that have implemented MTM services.
(f) Reporting to the Secretary.--An entity that receives a grant
under subsection (a) shall submit to the Secretary a report that
describes and evaluates, as requested by the Secretary, the activities
carried out under subsection (c), including quality measures, as
determined by the Secretary.
(g) Evaluation and Report.--The Secretary shall submit to the
relevant committees of Congress a report which shall--
(1) assess the clinical effectiveness of pharmacist-provided
services under the MTM services program, as compared to usual
care, including an evaluation of whether enrollees maintained
better health with fewer hospitalizations and emergency room
visits than similar patients not enrolled in the program;
(2) assess changes in overall health care resource of
targeted individuals;
(3) assess patient and prescriber satisfaction with MTM
services;
(4) assess the impact of patient-cost-sharing requirements on
medication adherence and recommendations for modifications;
(5) identify and evaluate other factors that may impact
clinical and economic outcomes, including demographic
characteristics, clinical characteristics, and health services
use of the patient, as well as characteristics of the regimen,
pharmacy benefit, and MTM services provided; and
(6) evaluate the extent to which participating pharmacists
who maintain a dispensing role have a conflict of interest in
the provision of MTM services, and if such conflict is found,
provide recommendations on how such a conflict might be
appropriately addressed.
(h) Grant To Fund Development of Performance Measures.--The Secretary
may award grants or contracts to eligible entities for the purpose of
funding the development of performance measures that assess the use and
effectiveness of medication therapy management services.
SEC. 2530. POSTPARTUM DEPRESSION.
(a) Expansion and Intensification of Activities.--
(1) Continuation of activities.--The Secretary is encouraged
to expand and intensify activities on postpartum conditions.
(2) Programs for postpartum conditions.--In carrying out
paragraph (1), the Secretary is encouraged to continue research
to expand the understanding of the causes of, and treatments
for, postpartum conditions, including conducting and supporting
the following:
(A) Basic research concerning the etiology and causes
of the conditions.
(B) Epidemiological studies to address the frequency
and natural history of the conditions and the
differences among racial and ethnic groups with respect
to the conditions.
(C) The development of improved screening and
diagnostic techniques.
(D) Clinical research for the development and
evaluation of new treatments.
(E) Information and education programs for health
professionals and the public, which may include a
coordinated national campaign that--
(i) is designed to increase the awareness and
knowledge of postpartum conditions;
(ii) may include public service announcements
through television, radio, and other means; and
(iii) may focus on--
(I) raising awareness about
screening;
(II) educating new mothers and their
families about postpartum conditions to
promote earlier diagnosis and
treatment; and
(III) ensuring that such education
includes complete information
concerning postpartum conditions,
including its symptoms, methods of
coping with the illness, and treatment
resources.
(b) Report by the Secretary.--
(1) Study.--The Secretary shall conduct a study on the
benefits of screening for postpartum conditions.
(2) Report.--Not later than 2 years after the date of the
enactment of this Act, the Secretary shall complete the study
required by paragraph (1) and submit a report to the Congress
on the results of such study.
(c) Sense of Congress Regarding Longitudinal Study of Relative Mental
Health Consequences for Women of Resolving a Pregnancy.--
(1) Sense of congress.--It is the sense of the Congress that
the Director of the National Institute of Mental Health may
conduct a nationally representative longitudinal study (during
the period of fiscal years 2009 through 2018) on the relative
mental health consequences for women of resolving a pregnancy
(intended and unintended) in various ways, including carrying
the pregnancy to term and parenting the child, carrying the
pregnancy to term and placing the child for adoption,
miscarriage, and having an abortion. This study may assess the
incidence, timing, magnitude, and duration of the immediate and
long-term mental health consequences (positive or negative) of
these pregnancy outcomes.
(2) Report.--Beginning not later than 3 years after the date
of the enactment of this Act, and periodically thereafter for
the duration of the study, such Director may prepare and submit
to the Congress reports on the findings of the study.
(d) Definitions.--In this section:
(1) The term ``postpartum condition'' means postpartum
depression or postpartum psychosis.
(2) The term ``Secretary'' means the Secretary of Health and
Human Services.
(e) Authorization of Appropriations.--For the purpose of carrying out
this section, in addition to any other amounts authorized to be
appropriated for such purpose, there are authorized to be appropriated
such sums as may be necessary for fiscal years 2010 through 2012.
SEC. 2531. GRANTS TO PROMOTE POSITIVE HEALTH BEHAVIORS AND OUTCOMES.
Part P of title III (42 U.S.C. 280g et seq.) is amended by adding at
the end the following:
``SEC. 399V. GRANTS TO PROMOTE POSITIVE HEALTH BEHAVIORS AND OUTCOMES.
``(a) Grants Authorized.--The Secretary, in collaboration with the
Director of the Centers for Disease Control and Prevention and other
Federal officials determined appropriate by the Secretary, is
authorized to award grants to eligible entities to promote positive
health behaviors for populations in medically underserved communities
through the use of community health workers.
``(b) Use of Funds.--Grants awarded under subsection (a) shall be
used to support community health workers--
``(1) to educate, guide, and provide outreach in a community
setting regarding health problems prevalent in medically
underserved communities, especially racial and ethnic minority
populations;
``(2) to educate, guide, and provide experiential learning
opportunities that target behavioral risk factors including--
``(A) poor nutrition;
``(B) physical inactivity;
``(C) being overweight or obese;
``(D) tobacco use;
``(E) alcohol and substance use;
``(F) injury and violence;
``(G) risky sexual behavior;
``(H) untreated mental health problems;
``(I) untreated dental and oral health problems; and
``(J) understanding informed consent;
``(3) to educate and provide guidance regarding effective
strategies to promote positive health behaviors within the
family;
``(4) to educate and provide outreach regarding enrollment in
health insurance including the State Children's Health
Insurance Program under title XXI of the Social Security Act,
Medicare under title XVIII of such Act, and Medicaid under
title XIX of such Act;
``(5) to educate and refer underserved populations to
appropriate health care agencies and community-based programs
and organizations in order to increase access to quality health
care services, including preventive health services, and to
eliminate duplicative care; or
``(6) to educate, guide, and provide home visitation services
regarding maternal health and prenatal care.
``(c) Application.--
``(1) In general.--Each eligible entity that desires to
receive a grant under subsection (a) shall submit an
application to the Secretary, at such time, in such manner, and
accompanied by such information as the Secretary may require.
``(2) Contents.--Each application submitted pursuant to
paragraph (1) shall--
``(A) describe the activities for which assistance is
sought under this section;
``(B) contain an assurance that, with respect to each
community health worker program receiving funds under
the grant, such program will provide training and
supervision to community health workers to enable such
workers to provide authorized program services;
``(C) contain an assurance that the applicant will
evaluate the effectiveness of community health worker
programs receiving funds under the grant;
``(D) contain an assurance that each community health
worker program receiving funds under the grant will
provide services in the cultural context most
appropriate for the individuals served by the program;
``(E) contain a plan to document and disseminate
project descriptions and results to other States and
organizations as identified by the Secretary; and
``(F) describe plans to enhance the capacity of
individuals to utilize health services and health-
related social services under Federal, State, and local
programs by--
``(i) assisting individuals in establishing
eligibility under the programs and in receiving
the services or other benefits of the programs;
and
``(ii) providing other services as the
Secretary determines to be appropriate, that
may include transportation and translation
services.
``(d) Priority.--In awarding grants under subsection (a), the
Secretary shall give priority to applicants that--
``(1) propose to target geographic areas--
``(A) with a high percentage of residents who are
eligible for health insurance but are uninsured or
underinsured;
``(B) with a high percentage of residents who suffer
from chronic diseases including pulmonary conditions,
hypertension, heart disease, mental disorders,
diabetes, and asthma; and
``(C) with a high infant mortality rate;
``(2) have experience in providing health or health-related
social services to individuals who are underserved with respect
to such services; and
``(3) have documented community activity and experience with
community health workers.
``(e) Collaboration With Academic Institutions.--The Secretary shall
encourage community health worker programs receiving funds under this
section to collaborate with academic institutions, especially those
that graduate a disproportionate number of health and health care
students from underrepresented racial and ethnic minority backgrounds.
Nothing in this section shall be construed to require such
collaboration.
``(f) Evidence-Based Interventions.--The Secretary shall encourage
community health worker programs receiving funding under this section
to implement an outcome-based payment system that rewards community
health workers for connecting underserved populations with the most
appropriate services at the most appropriate time. Nothing in this
section shall be construed to require such payment.
``(g) Quality Assurance and Cost Effectiveness.--The Secretary shall
establish guidelines for assuring the quality of the training and
supervision of community health workers under the programs funded under
this section and for assuring the cost-effectiveness of such programs.
``(h) Monitoring.--The Secretary shall monitor community health
worker programs identified in approved applications under this section
and shall determine whether such programs are in compliance with the
guidelines established under subsection (g).
``(i) Technical Assistance.--The Secretary may provide technical
assistance to community health worker programs identified in approved
applications under this section with respect to planning, developing,
and operating programs under the grant.
``(j) Report to Congress.--
``(1) In general.--Not later than 4 years after the date on
which the Secretary first awards grants under subsection (a),
the Secretary shall submit to Congress a report regarding the
grant project.
``(2) Contents.--The report required under paragraph (1)
shall include the following:
``(A) A description of the programs for which grant
funds were used.
``(B) The number of individuals served under such
programs.
``(C) An evaluation of--
``(i) the effectiveness of such programs;
``(ii) the cost of such programs; and
``(iii) the impact of the programs on the
health outcomes of the community residents.
``(D) Recommendations for sustaining the community
health worker programs developed or assisted under this
section.
``(E) Recommendations regarding training to enhance
career opportunities for community health workers.
``(k) Definitions.--In this section:
``(1) Community health worker.--The term `community health
worker' means an individual who promotes health or nutrition
within the community in which the individual resides--
``(A) by serving as a liaison between communities and
health care agencies;
``(B) by providing guidance and social assistance to
community residents;
``(C) by enhancing community residents' ability to
effectively communicate with health care providers;
``(D) by providing culturally and linguistically
appropriate health or nutrition education;
``(E) by advocating for individual and community
health, including oral and mental, or nutrition needs;
and
``(F) by providing referral and followup services or
otherwise coordinating care.
``(2) Community setting.--The term `community setting' means
a home or a community organization located in the neighborhood
in which a participant resides.
``(3) Medically underserved community.--The term `medically
underserved community' means a community identified by a State,
United States territory or possession, or federally recognized
Indian tribe--
``(A) that has a substantial number of individuals
who are members of a medically underserved population,
as defined by section 330(b)(3); and
``(B) a significant portion of which is a health
professional shortage area as designated under section
332.
``(4) Support.--The term `support' means the provision of
training, supervision, and materials needed to effectively
deliver the services described in subsection (b), reimbursement
for services, and other benefits.
``(5) Eligible entity.--The term `eligible entity' means a
public or nonprofit private entity (including a State or public
subdivision of a State, a public health department, or a
federally qualified health center), or a consortium of any of
such entities, located in the United States or territory
thereof.
``(l) Authorization of Appropriations.--There is authorized to be
appropriated to carry out this section $30,000,000 for each of fiscal
years 2010, 2011, 2012, 2013, and 2014.''.
PART 3--EMERGENCY CARE-RELATED PROGRAMS
SEC. 2541. TRAUMA CARE CENTERS.
(a) Grants for Trauma Care Centers.--Section 1241 (42 U.S.C. 300d-41)
is amended to read as follows:
``SEC. 1241. GRANTS FOR CERTAIN TRAUMA CENTERS.
``(a) In General.--The Secretary shall establish a trauma center
program consisting of awarding grants under section (b).
``(b) Grants.--The Secretary shall award grants as follows:
``(1) Existing centers.--Grants to public, private nonprofit,
Indian Health Service, Indian tribal, and urban Indian trauma
centers--
``(A) to further the core missions of such centers;
or
``(B) to provide emergency relief to ensure the
continued and future availability of trauma services by
trauma centers--
``(i) at risk of closing or operating in an
area where a closing has occurred within their
primary service area; or
``(ii) in need of financial assistance
following a natural disaster or other
catastrophic event, such as a terrorist attack.
``(2) New centers.--Grants to local governments and public or
private nonprofit entities to establish new trauma centers in
urban areas with a substantial degree of trauma resulting from
violent crimes.
``(c) Minimum Qualifications of Trauma Centers.--
``(1) Participation in trauma care system operating under
certain professional guidelines.--
``(A) Limitation.--Subject to subparagraph (B), the
Secretary may not award a grant to an existing trauma
center under this section unless the center is a
participant in a trauma care system that substantially
complies with section 1213.
``(B) Exemption.--Subparagraph (A) shall not apply to
trauma centers that are located in States with no
existing trauma care system.
``(2) Designation.--The Secretary may not award a grant under
this section to an existing trauma center unless the center
is--
``(A) verified as a trauma center by the American
College of Surgeons; or
``(B) designated as a trauma center by the applicable
State health or emergency medical services
authority.''.
(b) Considerations in Making Grants.--Section 1242 (42 U.S.C. 300d-
42) is amended to read as follows:
``SEC. 1242. CONSIDERATIONS IN MAKING GRANTS.
``(a) Core Mission Awards.--
``(1) In general.--In awarding grants under section
1241(b)(1)(A), the Secretary shall--
``(A) reserve a minimum of 25 percent of the amount
allocated for such grants for level III and level IV
trauma centers in rural or underserved areas;
``(B) reserve a minimum of 25 percent of the amount
allocated for such grants for level I and level II
trauma centers in urban areas; and
``(C) give preference to any application made by a
trauma center--
``(i) in a geographic area where growth in
demand for trauma services exceeds capacity;
``(ii) that demonstrates the financial
support of the State or political subdivision
involved;
``(iii) that has at least 1 graduate medical
education fellowship in trauma or trauma-
related specialties, including neurological
surgery, surgical critical care, vascular
surgery, and spinal cord injury, for which
demand is exceeding supply; or
``(iv) that demonstrates a substantial
commitment to serving vulnerable populations.
``(2) Financial support.--For purposes of paragraph
(1)(C)(ii), financial support may be demonstrated by State or
political subdivision funding for the trauma center's capital
or operating expenses (including through State trauma regional
advisory coordination activities, Medicaid funding designated
for trauma services, or other governmental funding). State
funding derived from Federal support shall not constitute State
or local financial support for purposes of preferential
treatment under this subsection.
``(3) Use of funds.--The recipient of a grant under section
1241(b)(1)(A) shall carry out, consistent with furthering the
core missions of the center, one or more of the following
activities:
``(A) Providing 24-hour-a-day, 7-day-a-week trauma
care availability.
``(B) Reducing overcrowding related to throughput of
trauma patients.
``(C) Enhancing trauma surge capacity.
``(D) Ensuring physician and essential personnel
availability.
``(E) Trauma education and outreach.
``(F) Coordination with local and regional trauma
care systems.
``(G) Such other activities as the Secretary may deem
appropriate.
``(b) Emergency Awards; New Centers.--In awarding grants under
paragraphs (1)(B) and (2) of section 1241(b), the Secretary shall--
``(1) give preference to any application submitted by an
applicant that demonstrates the financial support (in
accordance with subsection (a)(2)) of the State or political
subdivision involved for the activities to be funded through
the grant for each fiscal year during which payments are made
to the center under the grant; and
``(2) give preference to any application submitted for a
trauma center that--
``(A) is providing or will provide trauma care in a
geographic area in which the availability of trauma
care has either significantly decreased as a result of
a trauma center in the area permanently ceasing
participation in a system described in section
1241(c)(1) as of a date occurring during the 2-year
period preceding the fiscal year for which the trauma
center is applying to receive a grant, or in geographic
areas where growth in demand for trauma services
exceeds capacity;
``(B) will, in providing trauma care during the 1-
year period beginning on the date on which the
application for the grant is submitted, incur
substantial uncompensated care costs in an amount that
renders the center unable to continue participation in
such system and results in a significant decrease in
the availability of trauma care in the geographic area;
``(C) operates or will operate in rural areas where
trauma care availability will significantly decrease if
the center is forced to close or downgrade service and
substantial costs are contributing to a likelihood of
such closure or downgradation;
``(D) is in a geographic location substantially
affected by a natural disaster or other catastrophic
event such as a terrorist attack; or
``(E) will establish a new trauma service in an urban
area with a substantial degree of trauma resulting from
violent crimes.
``(c) Designations of Levels of Trauma Centers in Certain States.--In
the case of a State which has not designated 4 levels of trauma
centers, any reference in this section to--
``(1) a level I or level II trauma center is deemed to be a
reference to a trauma center within the highest 2 levels of
trauma centers designated under State guidelines; and
``(2) a level III or IV trauma center is deemed to be a
reference to a trauma center not within such highest 2
levels.''.
(c) Certain Agreements.--Section 1243 (42 U.S.C. 300d-43) is amended
to read as follows:
``SEC. 1243. CERTAIN AGREEMENTS.
``(a) Commitment Regarding Continued Participation in Trauma Care
System.--The Secretary may not award a grant to an applicant under
section 1241(b) unless the applicant agrees that--
``(1) the trauma center involved will continue participation,
or in the case of a new center will participate, in the system
described in section 1241(c)(1), except as provided in section
1241(c)(1)(B), throughout the grant period beginning on the
date that the center first receives payments under the grant;
and
``(2) if the agreement made pursuant to paragraph (1) is
violated by the center, the center will be liable to the United
States for an amount equal to the sum of--
``(A) the amount of assistance provided to the center
under section 1241; and
``(B) an amount representing interest on the amount
specified in subparagraph (A).
``(b) Maintenance of Financial Support.--With respect to activities
for which funds awarded through a grant under section 1241 are
authorized to be expended, the Secretary may not award such a grant
unless the applicant agrees that, during the period in which the trauma
center involved is receiving payments under the grant, the center will
maintain access to trauma services at levels not less than the levels
for the prior year, taking into account--
``(1) reasonable volume fluctuation that is not caused by
intentional trauma boundary reduction;
``(2) downgrading of the level of services; and
``(3) whether such center diverts its incoming patients away
from such center 5 percent or more of the time during which the
center is in operation over the course of the year.
``(c) Trauma Care Registry.--The Secretary may not award a grant to a
trauma center under section 1241(b)(1) unless the center agrees that--
``(1) not later than 6 months after the date on which the
center submits a grant application to the Secretary, the center
will establish and operate a registry of trauma cases in
accordance with guidelines developed by the American College of
Surgeons; and
``(2) in carrying out paragraph (1), the center will maintain
information on the number of trauma cases treated by the center
and, for each such case, the extent to which the center incurs
uncompensated costs in providing trauma care.''.
(d) General Provisions.--Section 1244 (42 U.S.C. 300d-44) is amended
to read as follows:
``SEC. 1244. GENERAL PROVISIONS.
``(a) Limitation on Duration of Support.--The period during which a
trauma center receives payments under a grant under section 1241(b)(1)
shall be for 3 fiscal years, except that the Secretary may waive such
requirement for the center and authorize the center to receive such
payments for 1 additional fiscal year.
``(b) Eligibility.--The acquisition of, or eligibility for, a grant
under section 1241(b) shall not preclude a trauma center's eligibility
for another grant described in such section.
``(c) Funding Distribution.--Of the total amount appropriated for a
fiscal year under section 1245--
``(1) 90 percent shall be used for grants under paragraph
(1)(A) of section 1241(b); and
``(2) 10 percent shall be used for grants under paragraphs
(1)(B) and (2) of section 1241(b).
``(d) Report.--Beginning 2 years after the date of the enactment of
the America's Affordable Health Choices Act of 2009, and every 2 years
thereafter, the Secretary shall biennially--
``(1) report to Congress on the status of the grants made
pursuant to section 1241;
``(2) evaluate and report to Congress on the overall
financial stability of trauma centers in the United States;
``(3) report on the populations using trauma care centers and
include aggregate patient data on income, race, ethnicity, and
geography; and
``(4) evaluate the effectiveness and efficiency of trauma
care center activities using standard public health measures
and evaluation methodologies.''.
(e) Authorization of Appropriations.--Section 1245 (42 U.S.C. 300d-
45) is amended to read as follows:
``SEC. 1245. AUTHORIZATION OF APPROPRIATIONS.
``(a) In General.--For the purpose of carrying out this part, there
are authorized to be appropriated $100,000,000 for fiscal year 2010,
and such sums as may be necessary for each of fiscal years 2011 through
2015. Such authorization of appropriations is in addition to any other
authorization of appropriations or amounts that are available for such
purpose.
``(b) Reallocation.--The Secretary shall reallocate for grants under
section 1241(b)(1)(A) any funds appropriated for grants under paragraph
(1)(B) or (2) of section 1241(b), but not obligated due to insufficient
applications eligible for funding.''.
SEC. 2542. EMERGENCY CARE COORDINATION.
(a) In General.--Subtitle B of title XXVIII (42 U.S.C. 300hh-10 et
seq.) is amended by adding at the end the following:
``SEC. 2816. EMERGENCY CARE COORDINATION.
``(a) Emergency Care Coordination Center.--
``(1) Establishment.--The Secretary shall establish, within
the Office of the Assistant Secretary for Preparedness and
Response, an Emergency Care Coordination Center (in this
section referred to as the `Center'), to be headed by a
director.
``(2) Duties.--The Secretary, acting through the Director of
the Center, in coordination with the Federal Interagency
Committee on Emergency Medical Services, shall--
``(A) promote and fund research in emergency medicine
and trauma health care;
``(B) promote regional partnerships and more
effective emergency medical systems in order to enhance
appropriate triage, distribution, and care of routine
community patients; and
``(C) promote local, regional, and State emergency
medical systems' preparedness for and response to
public health events.
``(b) Council of Emergency Care.--
``(1) Establishment.--The Secretary, acting through the
Director of the Center, shall establish a Council of Emergency
Care to provide advice and recommendations to the Director on
carrying out this section.
``(2) Composition.--The Council shall be comprised of
employees of the departments and agencies of the Federal
Government who are experts in emergency care and management.
``(c) Report.--
``(1) Submission.--Not later than 12 months after the date of
the enactment of the America's Affordable Health Choices Act of
2009, the Secretary shall submit to the Congress an annual
report on the activities carried out under this section.
``(2) Considerations.--In preparing a report under paragraph
(1), the Secretary shall consider factors including--
``(A) emergency department crowding and boarding; and
``(B) delays in care following presentation.
``(d) Authorization of Appropriations.--To carry out this section,
there are authorized to be appropriated such sums as may be necessary
for fiscal years 2010 through 2014.''.
(b) Functions, Personnel, Assets, Liabilities, and Administrative
Actions.--All functions, personnel, assets, and liabilities of, and
administrative actions applicable to, the Emergency Care Coordination
Center, as in existence on the day before the date of the enactment of
this Act, shall be transferred to the Emergency Care Coordination
Center established under section 2816(a) of the Public Health Service
Act, as added by subsection (a).
SEC. 2543. PILOT PROGRAMS TO IMPROVE EMERGENCY MEDICAL CARE.
Part B of title III (42 U.S.C. 243 et seq.) is amended by inserting
after section 314 the following:
``SEC. 315. REGIONALIZED COMMUNICATION SYSTEMS FOR EMERGENCY CARE
RESPONSE.
``(a) In General.--The Secretary, acting through the Assistant
Secretary for Preparedness and Response, shall award not fewer than 4
multiyear contracts or competitive grants to eligible entities to
support demonstration programs that design, implement, and evaluate
innovative models of regionalized, comprehensive, and accountable
emergency care systems.
``(b) Eligible Entity; Region.--
``(1) Eligible entity.--In this section, the term `eligible
entity' means a State or a partnership of 1 or more States and
1 or more local governments.
``(2) Region.--In this section, the term `region' means an
area within a State, an area that lies within multiple States,
or a similar area (such as a multicounty area), as determined
by the Secretary.
``(c) Demonstration Program.--The Secretary shall award a contract or
grant under subsection (a) to an eligible entity that proposes a
demonstration program to design, implement, and evaluate an emergency
medical system that--
``(1) coordinates with public safety services, public health
services, emergency medical services, medical facilities, and
other entities within a region;
``(2) coordinates an approach to emergency medical system
access throughout the region, including 9-1-1 public safety
answering points and emergency medical dispatch;
``(3) includes a mechanism, such as a regional medical
direction or transport communications system, that operates
throughout the region to ensure that the correct patient is
taken to the medically appropriate facility (whether an initial
facility or a higher level facility) in a timely fashion;
``(4) allows for the tracking of prehospital and hospital
resources, including inpatient bed capacity, emergency
department capacity, on-call specialist coverage, ambulance
diversion status, and the coordination of such tracking with
regional communications and hospital destination decisions; and
``(5) includes a consistent regionwide prehospital, hospital,
and interfacility data management system that--
``(A) complies with the National EMS Information
System, the National Trauma Data Bank, and others;
``(B) reports data to appropriate Federal and State
databanks and registries; and
``(C) contains information sufficient to evaluate key
elements of prehospital care, hospital destination
decisions, including initial hospital and interfacility
decisions, and relevant outcomes of hospital care.
``(d) Application.--
``(1) In general.--An eligible entity that seeks a contract
or grant described in subsection (a) shall submit to the
Secretary an application at such time and in such manner as the
Secretary may require.
``(2) Application information.--Each application shall
include--
``(A) an assurance from the eligible entity that the
proposed system--
``(i) has been coordinated with the
applicable State office of emergency medical
services (or equivalent State office);
``(ii) is compatible with the applicable
State emergency medical services system;
``(iii) includes consistent indirect and
direct medical oversight of prehospital,
hospital, and interfacility transport
throughout the region;
``(iv) coordinates prehospital treatment and
triage, hospital destination, and interfacility
transport throughout the region;
``(v) includes a categorization or
designation system for special medical
facilities throughout the region that is--
``(I) consistent with State laws and
regulations; and
``(II) integrated with the protocols
for transport and destination
throughout the region; and
``(vi) includes a regional medical direction
system, a patient tracking system, and a
resource allocation system that--
``(I) support day-to-day emergency
care system operation;
``(II) can manage surge capacity
during a major event or disaster; and
``(III) are integrated with other
components of the national and State
emergency preparedness system;
``(B) an agreement to make available non-Federal
contributions in accordance with subsection (e); and
``(C) such other information as the Secretary may
require.
``(e) Matching Funds.--
``(1) In general.--With respect to the costs of the
activities to be carried out each year with a contract or grant
under subsection (a), a condition for the receipt of the
contract or grant is that the eligible entity involved agrees
to make available (directly or through donations from public or
private entities) non-Federal contributions toward such costs
in an amount that is not less than 25 percent of such costs.
``(2) Determination of amount contributed.--Non-Federal
contributions required in paragraph (1) may be in cash or in
kind, fairly evaluated, including plant, equipment, or
services. Amounts provided by the Federal Government, or
services assisted or subsidized to any significant extent by
the Federal Government, may not be included in determining the
amount of such non-Federal contributions.
``(f) Priority.--The Secretary shall give priority for the award of
the contracts or grants described in subsection (a) to any eligible
entity that serves a medically underserved population (as defined in
section 330(b)(3)).
``(g) Report.--Not later than 90 days after the completion of a
demonstration program under subsection (a), the recipient of such
contract or grant described in such subsection shall submit to the
Secretary a report containing the results of an evaluation of the
program, including an identification of--
``(1) the impact of the regional, accountable emergency care
system on patient outcomes for various critical care
categories, such as trauma, stroke, cardiac emergencies, and
pediatric emergencies;
``(2) the system characteristics that contribute to the
effectiveness and efficiency of the program (or lack thereof);
``(3) methods of assuring the long-term financial
sustainability of the emergency care system;
``(4) the State and local legislation necessary to implement
and to maintain the system; and
``(5) the barriers to developing regionalized, accountable
emergency care systems, as well as the methods to overcome such
barriers.
``(h) Evaluation.--The Secretary, acting through the Assistant
Secretary for Preparedness and Response, shall enter into a contract
with an academic institution or other entity to conduct an independent
evaluation of the demonstration programs funded under subsection (a),
including an evaluation of--
``(1) the performance of the eligible entities receiving the
funds; and
``(2) the impact of the demonstration programs.
``(i) Dissemination of Findings.--The Secretary shall, as
appropriate, disseminate to the public and to the appropriate
committees of the Congress, the information contained in a report made
under subsection (h).
``(j) Authorization of Appropriations.--
``(1) In general.--There is authorized to be appropriated to
carry out this section $12,000,000 for each of fiscal years
2010 through 2015.
``(2) Reservation.--Of the amount appropriated to carry out
this section for a fiscal year, the Secretary shall reserve 3
percent of such amount to carry out subsection (h) (relating to
an independent evaluation).''.
SEC. 2544. ASSISTING VETERANS WITH MILITARY EMERGENCY MEDICAL TRAINING
TO BECOME STATE-LICENSED OR CERTIFIED EMERGENCY
MEDICAL TECHNICIANS (EMTS).
(a) In General.--Part B of title III (42 U.S.C. 243 et seq.), as
amended, is amended by inserting after section 315 the following:
``SEC. 315A. ASSISTING VETERANS WITH MILITARY EMERGENCY MEDICAL
TRAINING TO BECOME STATE-LICENSED OR CERTIFIED
EMERGENCY MEDICAL TECHNICIANS (EMTS).
``(a) Program.--The Secretary shall establish a program consisting of
awarding grants to States to assist veterans who received and completed
military emergency medical training while serving in the Armed Forces
of the United States to become, upon their discharge or release from
active duty service, State-licensed or certified emergency medical
technicians.
``(b) Use of Funds.--Amounts received as a grant under this section
may be used to assist veterans described in subsection (a) to become
State-licensed or certified emergency medical technicians as follows:
``(1) Providing training.
``(2) Providing reimbursement for costs associated with--
``(A) training; or
``(B) applying for licensure or certification.
``(3) Expediting the licensing or certification process.
``(c) Eligibility.--To be eligible for a grant under this section, a
State shall demonstrate to the Secretary's satisfaction that the State
has a shortage of emergency medical technicians.
``(d) Report.--The Secretary shall submit to the Congress an annual
report on the program under this section.
``(e) Authorization of Appropriations.--To carry out this section,
there are authorized to be appropriated such sums as may be necessary
for fiscal years 2010 through 2014.''.
(b) GAO Study and Report.--The Comptroller General of the United
States shall--
(1) conduct a study on the barriers experienced by veterans
who received training as medical personnel while serving in the
Armed Forces of the United States and, upon their discharge or
release from active duty service, seek to become licensed or
certified in a State as civilian health professionals; and
(2) not later than 2 years after the date of the enactment of
this Act, submit to the Congress a report on the results of
such study, including recommendations on whether the program
established under section 315A of the Public Health Service
Act, as added by subsection (a), should be expanded to assist
veterans seeking to become licensed or certified in a State as
health providers other than emergency medical technicians.
SEC. 2545. DENTAL EMERGENCY RESPONDERS: PUBLIC HEALTH AND MEDICAL
RESPONSE.
(a) National Health Security Strategy.--Section 2802(b)(3) (42 U.S.C.
300hh-1(b)(3)) is amended--
(1) in the matter preceding subparagraph (A), by inserting
``dental and'' before ``mental health facilities''; and
(2) in subparagraph (D), by inserting ``and dental'' after
``medical''.
(b) All-hazards Public Health and Medical Response Curricula and
Training.--Section 319F(a)(5)(B) (42 U.S.C. 247d-6(a)(5)(B)) is amended
by striking ``public health or medical'' and inserting ``public health,
medical, or dental''.
SEC. 2546. DENTAL EMERGENCY RESPONDERS: HOMELAND SECURITY.
(a) National Response Framework.--Paragraph (6) of section 2 of the
Homeland Security Act of 2002 (6 U.S.C. 101) is amended by inserting
``and dental'' after ``emergency medical''.
(b) National Preparedness System.--Subparagraph (B) of section
653(b)(4) of the Post-Katrina Emergency Management Reform Act of 2006
(6 U.S.C. 753(b)(4)) is amended by striking ``public health and
medical'' and inserting ``public health, medical, and dental''.
(c) Chief Medical Officer.--Paragraph (5) of section 516(c) of the
Homeland Security Act of 2002 (6 U.S.C. 321e(c)) is amended by striking
``medical community'' and inserting ``medical and dental communities''.
PART 4--PAIN CARE AND MANAGEMENT PROGRAMS
SEC. 2551. INSTITUTE OF MEDICINE CONFERENCE ON PAIN.
(a) Convening.--Not later than June 30, 2010, the Secretary of Health
and Human Services shall seek to enter into an agreement with the
Institute of Medicine of the National Academies to convene a Conference
on Pain (in this section referred to as ``the Conference'').
(b) Purposes.--The purposes of the Conference shall be to--
(1) increase the recognition of pain as a significant public
health problem in the United States;
(2) evaluate the adequacy of assessment, diagnosis,
treatment, and management of acute and chronic pain in the
general population, and in identified racial, ethnic, gender,
age, and other demographic groups that may be
disproportionately affected by inadequacies in the assessment,
diagnosis, treatment, and management of pain;
(3) identify barriers to appropriate pain care, including--
(A) lack of understanding and education among
employers, patients, health care providers, regulators,
and third-party payors;
(B) barriers to access to care at the primary,
specialty, and tertiary care levels, including
barriers--
(i) specific to those populations that are
disproportionately undertreated for pain;
(ii) related to physician concerns over
regulatory and law enforcement policies
applicable to some pain therapies; and
(iii) attributable to benefit, coverage, and
payment policies in both the public and private
sectors; and
(C) gaps in basic and clinical research on the
symptoms and causes of pain, and potential assessment
methods and new treatments to improve pain care; and
(4) establish an agenda for action in both the public and
private sectors that will reduce such barriers and
significantly improve the state of pain care research,
education, and clinical care in the United States.
(c) Other Appropriate Entity.--If the Institute of Medicine declines
to enter into an agreement under subsection (a), the Secretary of
Health and Human Services may enter into such agreement with another
appropriate entity.
(d) Report.--A report summarizing the Conference's findings and
recommendations shall be submitted to the Congress not later than June
30, 2011.
(e) Authorization of Appropriations.--For the purpose of carrying out
this section, there is authorized to be appropriated $500,000 for each
of fiscal years 2010 and 2011.
SEC. 2552. PAIN RESEARCH AT NATIONAL INSTITUTES OF HEALTH.
Part B of title IV (42 U.S.C. 284 et seq.) is amended by adding at
the end the following:
``SEC. 409J. PAIN RESEARCH.
``(a) Research Initiatives.--
``(1) In general.--The Director of NIH is encouraged to
continue and expand, through the Pain Consortium, an aggressive
program of basic and clinical research on the causes of and
potential treatments for pain.
``(2) Annual recommendations.--Not less than annually, the
Pain Consortium, in consultation with the Division of Program
Coordination, Planning, and Strategic Initiatives, shall
develop and submit to the Director of NIH recommendations on
appropriate pain research initiatives that could be undertaken
with funds reserved under section 402A(c)(1) for the Common
Fund or otherwise available for such initiatives.
``(3) Definition.--In this subsection, the term `Pain
Consortium' means the Pain Consortium of the National
Institutes of Health or a similar trans-National Institutes of
Health coordinating entity designated by the Secretary for
purposes of this subsection.
``(b) Interagency Pain Research Coordinating Committee.--
``(1) Establishment.--The Secretary shall establish not later
than 1 year after the date of the enactment of this section and
as necessary maintain a committee, to be known as the
Interagency Pain Research Coordinating Committee (in this
section referred to as the `Committee'), to coordinate all
efforts within the Department of Health and Human Services and
other Federal agencies that relate to pain research.
``(2) Membership.--
``(A) In general.--The Committee shall be composed of
the following voting members:
``(i) Not more than 7 voting Federal
representatives as follows:
``(I) The Director of the Centers for
Disease Control and Prevention.
``(II) The Director of the National
Institutes of Health and the directors
of such national research institutes
and national centers as the Secretary
determines appropriate.
``(III) The heads of such other
agencies of the Department of Health
and Human Services as the Secretary
determines appropriate.
``(IV) Representatives of other
Federal agencies that conduct or
support pain care research and
treatment, including the Department of
Defense and the Department of Veterans
Affairs.
``(ii) 12 additional voting members appointed
under subparagraph (B).
``(B) Additional members.--The Committee shall
include additional voting members appointed by the
Secretary as follows:
``(i) 6 members shall be appointed from among
scientists, physicians, and other health
professionals, who--
``(I) are not officers or employees
of the United States;
``(II) represent multiple
disciplines, including clinical, basic,
and public health sciences;
``(III) represent different
geographical regions of the United
States; and
``(IV) are from practice settings,
academia, manufacturers, or other
research settings; and
``(ii) 6 members shall be appointed from
members of the general public, who are
representatives of leading research, advocacy,
and service organizations for individuals with
pain-related conditions.
``(C) Nonvoting members.--The Committee shall include
such nonvoting members as the Secretary determines to
be appropriate.
``(3) Chairperson.--The voting members of the Committee shall
select a chairperson from among such members. The selection of
a chairperson shall be subject to the approval of the Director
of NIH.
``(4) Meetings.--The Committee shall meet at the call of the
chairperson of the Committee or upon the request of the
Director of NIH, but in no case less often than once each year.
``(5) Duties.--The Committee shall--
``(A) develop a summary of advances in pain care
research supported or conducted by the Federal agencies
relevant to the diagnosis, prevention, and treatment of
pain and diseases and disorders associated with pain;
``(B) identify critical gaps in basic and clinical
research on the symptoms and causes of pain;
``(C) make recommendations to ensure that the
activities of the National Institutes of Health and
other Federal agencies, including the Department of
Defense and the Department of Veteran Affairs, are free
of unnecessary duplication of effort;
``(D) make recommendations on how best to disseminate
information on pain care; and
``(E) make recommendations on how to expand
partnerships between public entities, including Federal
agencies, and private entities to expand collaborative,
cross-cutting research.
``(6) Review.--The Secretary shall review the necessity of
the Committee at least once every 2 years.''.
SEC. 2553. PUBLIC AWARENESS CAMPAIGN ON PAIN MANAGEMENT.
Part B of title II (42 U.S.C. 238 et seq.) is amended by adding at
the end the following:
``SEC. 249. NATIONAL EDUCATION OUTREACH AND AWARENESS CAMPAIGN ON PAIN
MANAGEMENT.
``(a) Establishment.--Not later than June 30, 2010, the Secretary
shall establish and implement a national pain care education outreach
and awareness campaign described in subsection (b).
``(b) Requirements.--The Secretary shall design the public awareness
campaign under this section to educate consumers, patients, their
families, and other caregivers with respect to--
``(1) the incidence and importance of pain as a national
public health problem;
``(2) the adverse physical, psychological, emotional,
societal, and financial consequences that can result if pain is
not appropriately assessed, diagnosed, treated, or managed;
``(3) the availability, benefits, and risks of all pain
treatment and management options;
``(4) having pain promptly assessed, appropriately diagnosed,
treated, and managed, and regularly reassessed with treatment
adjusted as needed;
``(5) the role of credentialed pain management specialists
and subspecialists, and of comprehensive interdisciplinary
centers of treatment expertise;
``(6) the availability in the public, nonprofit, and private
sectors of pain management-related information, services, and
resources for consumers, employers, third-party payors,
patients, their families, and caregivers, including information
on--
``(A) appropriate assessment, diagnosis, treatment,
and management options for all types of pain and pain-
related symptoms; and
``(B) conditions for which no treatment options are
yet recognized; and
``(7) other issues the Secretary deems appropriate.
``(c) Consultation.--In designing and implementing the public
awareness campaign required by this section, the Secretary shall
consult with organizations representing patients in pain and other
consumers, employers, physicians including physicians specializing in
pain care, other pain management professionals, medical device
manufacturers, and pharmaceutical companies.
``(d) Coordination.--
``(1) Lead official.--The Secretary shall designate one
official in the Department of Health and Human Services to
oversee the campaign established under this section.
``(2) Agency coordination.--The Secretary shall ensure the
involvement in the public awareness campaign under this section
of the Surgeon General of the Public Health Service, the
Director of the Centers for Disease Control and Prevention, and
such other representatives of offices and agencies of the
Department of Health and Human Services as the Secretary
determines appropriate.
``(e) Underserved Areas and Populations.--In designing the public
awareness campaign under this section, the Secretary shall--
``(1) take into account the special needs of geographic areas
and racial, ethnic, gender, age, and other demographic groups
that are currently underserved; and
``(2) provide resources that will reduce disparities in
access to appropriate diagnosis, assessment, and treatment.
``(f) Grants and Contracts.--The Secretary may make awards of grants,
cooperative agreements, and contracts to public agencies and private
nonprofit organizations to assist with the development and
implementation of the public awareness campaign under this section.
``(g) Evaluation and Report.--Not later than the end of fiscal year
2012, the Secretary shall prepare and submit to the Congress a report
evaluating the effectiveness of the public awareness campaign under
this section in educating the general public with respect to the
matters described in subsection (b).
``(h) Authorization of Appropriations.--For purposes of carrying out
this section, there are authorized to be appropriated $2,000,000 for
fiscal year 2010 and $4,000,000 for each of fiscal years 2011 and
2012.''.
Subtitle C--Food and Drug Administration
PART 1--IN GENERAL
SEC. 2561. NATIONAL MEDICAL DEVICE REGISTRY.
(a) Registry.--
(1) In general.--Section 519 of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 360i) is amended--
(A) by redesignating subsection (g) as subsection
(h); and
(B) by inserting after subsection (f) the following:
``National Medical Device Registry
``(g)(1) The Secretary shall establish a national medical device
registry (in this subsection referred to as the `registry') to
facilitate analysis of postmarket safety and outcomes data on each
device that--
``(A) is or has been used in or on a patient; and
``(B) is--
``(i) a class III device; or
``(ii) a class II device that is implantable, life-
supporting, or life-sustaining.
``(2) In developing the registry, the Secretary shall, in
consultation with the Commissioner of Food and Drugs, the Administrator
of the Centers for Medicare & Medicaid Services, the head of the Office
of the National Coordinator for Health Information Technology, and the
Secretary of Veterans Affairs, determine the best methods for--
``(A) including in the registry, in a manner consistent with
subsection (f), appropriate information to identify each device
described in paragraph (1) by type, model, and serial number or
other unique identifier;
``(B) validating methods for analyzing patient safety and
outcomes data from multiple sources and for linking such data
with the information included in the registry as described in
subparagraph (A), including, to the extent feasible, use of--
``(i) data provided to the Secretary under other
provisions of this chapter; and
``(ii) information from public and private sources
identified under paragraph (3);
``(C) integrating the activities described in this subsection
with--
``(i) activities under paragraph (3) of section
505(k) (relating to active postmarket risk
identification);
``(ii) activities under paragraph (4) of section
505(k) (relating to advanced analysis of drug safety
data); and
``(iii) other postmarket device surveillance
activities of the Secretary authorized by this chapter;
and
``(D) providing public access to the data and analysis
collected or developed through the registry in a manner and
form that protects patient privacy and proprietary information
and is comprehensive, useful, and not misleading to patients,
physicians, and scientists.
``(3)(A) To facilitate analyses of postmarket safety and patient
outcomes for devices described in paragraph (1), the Secretary shall,
in collaboration with public, academic, and private entities, develop
methods to--
``(i) obtain access to disparate sources of patient safety
and outcomes data, including--
``(I) Federal health-related electronic data (such as
data from the Medicare program under title XVIII of the
Social Security Act or from the health systems of the
Department of Veterans Affairs);
``(II) private sector health-related electronic data
(such as pharmaceutical purchase data and health
insurance claims data); and
``(III) other data as the Secretary deems necessary
to permit postmarket assessment of device safety and
effectiveness; and
``(ii) link data obtained under clause (i) with information
in the registry.
``(B) In this paragraph, the term `data' refers to information
respecting a device described in paragraph (1), including claims data,
patient survey data, standardized analytic files that allow for the
pooling and analysis of data from disparate data environments,
electronic health records, and any other data deemed appropriate by the
Secretary.
``(4) Not later than 36 months after the date of the enactment of
this subsection, the Secretary shall promulgate regulations for
establishment and operation of the registry under paragraph (1). Such
regulations--
``(A)(i) in the case of devices that are described in
paragraph (1) and sold on or after the date of the enactment of
this subsection, shall require manufacturers of such devices to
submit information to the registry, including, for each such
device, the type, model, and serial number or, if required
under subsection (f), other unique device identifier; and
``(ii) in the case of devices that are described in paragraph
(1) and sold before such date, may require manufacturers of
such devices to submit such information to the registry, if
deemed necessary by the Secretary to protect the public health;
``(B) shall establish procedures--
``(i) to permit linkage of information submitted
pursuant to subparagraph (A) with patient safety and
outcomes data obtained under paragraph (3); and
``(ii) to permit analyses of linked data;
``(C) may require device manufacturers to submit such other
information as is necessary to facilitate postmarket
assessments of device safety and effectiveness and notification
of device risks;
``(D) shall establish requirements for regular and timely
reports to the Secretary, which shall be included in the
registry, concerning adverse event trends, adverse event
patterns, incidence and prevalence of adverse events, and other
information the Secretary determines appropriate, which may
include data on comparative safety and outcomes trends; and
``(E) shall establish procedures to permit public access to
the information in the registry in a manner and form that
protects patient privacy and proprietary information and is
comprehensive, useful, and not misleading to patients,
physicians, and scientists.
``(5) To carry out this subsection, there are authorized to be
appropriated such sums as may be necessary for fiscal years 2010 and
2011.''.
(2) Effective date.--The Secretary of Health and Human
Services shall establish and begin implementation of the
registry under section 519(g) of the Federal Food, Drug, and
Cosmetic Act, as added by paragraph (1), by not later than the
date that is 36 months after the date of the enactment of this
Act, without regard to whether or not final regulations to
establish and operate the registry have been promulgated by
such date.
(3) Conforming amendment.--Section 303(f)(1)(B)(ii) of the
Federal Food, Drug, and Cosmetic Act (21 U.S.C.
333(f)(1)(B)(ii)) is amended by striking ``519(g)'' and
inserting ``519(h)''.
(b) Electronic Exchange and Use in Certified Electronic Health
Records of Unique Device Identifiers.--
(1) Recommendations.--The HIT Policy Committee established
under section 3002 of the Public Health Service Act (42 U.S.C.
300jj-12) shall recommend to the head of the Office of the
National Coordinator for Health Information Technology
standards, implementation specifications, and certification
criteria for the electronic exchange and use in certified
electronic health records of a unique device identifier for
each device described in section 519(g)(1) of the Federal Food,
Drug, and Cosmetic Act, as added by subsection (a).
(2) Standards, implementation criteria, and certification
criteria.--The Secretary of the Health Human Services, acting
through the head of the Office of the National Coordinator for
Health Information Technology, shall adopt standards,
implementation specifications, and certification criteria for
the electronic exchange and use in certified electronic health
records of a unique device identifier for each device described
in paragraph (1), if such an identifier is required by section
519(f) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C.
360i(f)) for the device.
SEC. 2562. NUTRITION LABELING OF STANDARD MENU ITEMS AT CHAIN
RESTAURANTS AND OF ARTICLES OF FOOD SOLD FROM
VENDING MACHINES.
(a) Technical Amendments.--Section 403(q)(5)(A) of the Federal Food,
Drug, and Cosmetic Act (21 U.S.C. 343(q)(5)(A)) is amended--
(1) in subclause (i), by inserting ``except as provided in
clause (H)(ii)(III),'' after ``(i)'' ; and
(2) in subclause (ii), by inserting ``except as provided in
clause (H)(ii)(III),'' after ``(ii)''.
(b) Labeling Requirements.--Section 403(q)(5) of the Federal Food,
Drug, and Cosmetic Act (21 U.S.C. 343(q)(5)) is amended by adding at
the end the following:
``(H) Restaurants, Retail Food Establishments, and Vending
Machines.--
``(i) General requirements for restaurants and similar retail
food establishments.--Except for food described in subclause
(vii), in the case of food that is a standard menu item that is
offered for sale in a restaurant or similar retail food
establishment that is part of a chain with 20 or more locations
doing business under the same name (regardless of the type of
ownership of the locations) and offering for sale substantially
the same menu items, the restaurant or similar retail food
establishment shall disclose the information described in
subclauses (ii) and (iii).
``(ii) Information required to be disclosed by restaurants
and retail food establishments.--Except as provided in
subclause (vii), the restaurant or similar retail food
establishment shall disclose in a clear and conspicuous
manner--
``(I)(aa) in a nutrient content disclosure statement
adjacent to the name of the standard menu item, so as
to be clearly associated with the standard menu item,
on the menu listing the item for sale, the number of
calories contained in the standard menu item, as
usually prepared and offered for sale; and
``(bb) a succinct statement concerning suggested
daily caloric intake, as specified by the Secretary by
regulation and posted prominently on the menu and
designed to enable the public to understand, in the
context of a total daily diet, the significance of the
caloric information that is provided on the menu;
``(II)(aa) in a nutrient content disclosure statement
adjacent to the name of the standard menu item, so as
to be clearly associated with the standard menu item,
on the menu board, including a drive-through menu
board, the number of calories contained in the standard
menu item, as usually prepared and offered for sale;
and
``(bb) a succinct statement concerning suggested
daily caloric intake, as specified by the Secretary by
regulation and posted prominently on the menu board,
designed to enable the public to understand, in the
context of a total daily diet, the significance of the
nutrition information that is provided on the menu
board;
``(III) in a written form, available on the premises
of the restaurant or similar retail establishment and
to the consumer upon request, the nutrition information
required under clauses (C) and (D) of subparagraph (1);
and
``(IV) on the menu or menu board, a prominent, clear,
and conspicuous statement regarding the availability of
the information described in item (III).
``(iii) Self-service food and food on display.--Except as
provided in subclause (vii), in the case of food sold at a
salad bar, buffet line, cafeteria line, or similar self-service
facility, and for self-service beverages or food that is on
display and that is visible to customers, a restaurant or
similar retail food establishment shall place adjacent to each
food offered a sign that lists calories per displayed food item
or per serving.
``(iv) Reasonable basis.--For the purposes of this clause, a
restaurant or similar retail food establishment shall have a
reasonable basis for its nutrient content disclosures,
including nutrient databases, cookbooks, laboratory analyses,
and other reasonable means, as described in section 101.10 of
title 21, Code of Federal Regulations (or any successor
regulation) or in a related guidance of the Food and Drug
Administration.
``(v) Menu variability and combination meals.--The Secretary
shall establish by regulation standards for determining and
disclosing the nutrient content for standard menu items that
come in different flavors, varieties, or combinations, but
which are listed as a single menu item, such as soft drinks,
ice cream, pizza, doughnuts, or children's combination meals,
through means determined by the Secretary, including ranges,
averages, or other methods.
``(vi) Additional information.--If the Secretary determines
that a nutrient, other than a nutrient required under subclause
(ii)(III), should be disclosed for the purpose of providing
information to assist consumers in maintaining healthy dietary
practices, the Secretary may require, by regulation, disclosure
of such nutrient in the written form required under subclause
(ii)(III).
``(vii) Nonapplicability to certain food.--
``(I) In general.--Subclauses (i) through (vi) do not
apply to--
``(aa) items that are not listed on a menu or
menu board (such as condiments and other items
placed on the table or counter for general
use);
``(bb) daily specials, temporary menu items
appearing on the menu for less than 60 days per
calendar year, or custom orders; or
``(cc) such other food that is part of a
customary market test appearing on the menu for
less than 90 days, under terms and conditions
established by the Secretary.
``(II) Written forms.--Clause (C) shall apply to any
regulations promulgated under subclauses (ii)(III) and
(vi).
``(viii) Vending machines.--In the case of an article of food
sold from a vending machine that--
``(I) does not permit a prospective purchaser to
examine the Nutrition Facts Panel before purchasing the
article or does not otherwise provide visible nutrition
information at the point of purchase; and
``(II) is operated by a person who is engaged in the
business of owning or operating 20 or more vending
machines,
the vending machine operator shall provide a sign in close
proximity to each article of food or the selection button that
includes a clear and conspicuous statement disclosing the
number of calories contained in the article.
``(ix) Voluntary provision of nutrition information.--
``(I) In general.--An authorized official of any
restaurant or similar retail food establishment or
vending machine operator not subject to the
requirements of this clause may elect to be subject to
the requirements of such clause, by registering
biannually the name and address of such restaurant or
similar retail food establishment or vending machine
operator with the Secretary, as specified by the
Secretary by regulation.
``(II) Registration.--Within 120 days of the
enactment of this clause, the Secretary shall publish a
notice in the Federal Register specifying the terms and
conditions for implementation of item (I), pending
promulgation of regulations.
``(III) Rule of construction.--Nothing in this
subclause shall be construed to authorize the Secretary
to require an application, review, or licensing process
for any entity to register with the Secretary, as
described in such item.
``(x) Regulations.--
``(I) Proposed regulation.--Not later than 1 year
after the date of the enactment of this clause, the
Secretary shall promulgate proposed regulations to
carry out this clause.
``(II) Contents.--In promulgating regulations, the
Secretary shall--
``(aa) consider standardization of recipes
and methods of preparation, reasonable
variation in serving size and formulation of
menu items, space on menus and menu boards,
inadvertent human error, training of food
service workers, variations in ingredients, and
other factors, as the Secretary determines; and
``(bb) specify the format and manner of the
nutrient content disclosure requirements under
this subclause.
``(III) Reporting.--The Secretary shall 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 quarterly report that
describes the Secretary's progress toward promulgating
final regulations under this subparagraph.
``(xi) Definition.--In this clause, the term `menu' or `menu
board' means the primary writing of the restaurant or other
similar retail food establishment from which a consumer makes
an order selection.''.
(c) National Uniformity.--Section 403A(a)(4) of the Federal Food,
Drug, and Cosmetic Act (21 U.S.C. 343-1(a)(4)) is amended by striking
``except a requirement for nutrition labeling of food which is exempt
under subclause (i) or (ii) of section 403(q)(5)(A)'' and inserting
``except that this paragraph does not apply to food that is offered for
sale in a restaurant or similar retail food establishment that is not
part of a chain with 20 or more locations doing business under the same
name (regardless of the type of ownership of the locations) and
offering for sale substantially the same menu items unless such
restaurant or similar retail food establishment complies with the
voluntary provision of nutrition information requirements under section
403(q)(5)(H)(ix)''.
(d) Rule of Construction.--Nothing in the amendments made by this
section shall be construed--
(1) to preempt any provision of State or local law, unless
such provision establishes or continues into effect nutrient
content disclosures of the type required under section
403(q)(5)(H) of the Federal Food, Drug, and Cosmetic Act (as
added by subsection (b)) and is expressly preempted under
section 403A(a)(4) of such Act;
(2) to apply to any State or local requirement respecting a
statement in the labeling of food that provides for a warning
concerning the safety of the food or component of the food; or
(3) except as provided in section 403(q)(5)(H)(ix) of the
Federal Food, Drug, and Cosmetic Act (as added by subsection
(b)), to apply to any restaurant or similar retail food
establishment other than a restaurant or similar retail food
establishment described in section 403(q)(5)(H)(i) of such Act.
SEC. 2563. PROTECTING CONSUMER ACCESS TO GENERIC DRUGS.
(a) In General.--Section 505 of the Federal Food, Drug, and Cosmetic
Act (21 U.S.C. 355) is amended by adding at the end the following:
``(w) Protecting Consumer Access to Generic Drugs.--
``(1) Unfair and deceptive acts and practices related to new
drug applications.--
``(A) Conduct prohibited.--It shall be unlawful for
any person to directly or indirectly be a party to any
agreement resolving or settling a patent infringement
claim in which--
``(i) an ANDA filer receives anything of
value; and
``(ii) the ANDA filer agrees to limit or
forego research, development, manufacturing,
marketing, or sales, for any period of time, of
the drug that is to be manufactured under the
ANDA involved and is the subject of the patent
infringement claim.
``(B) Exceptions.--Notwithstanding subparagraph
(A)(i), subparagraph (A) does not prohibit a resolution
or settlement of a patent infringement claim in which
the value received by the ANDA filer includes no more
than--
``(i) the right to market the drug that is to
be manufactured under the ANDA involved and is
the subject of the patent infringement claim,
before the expiration of--
``(I) the patent that is the basis
for the patent infringement claim; or
``(II) any other statutory
exclusivity that would prevent the
marketing of such drug; and
``(ii) the waiver of a patent infringement
claim for damages based on prior marketing of
such drug.
``(C) Enforcement.--
``(i) In general.--A violation of
subparagraph (A) shall be treated as an unfair
and deceptive act or practice and an unfair
method of competition in or affecting
interstate commerce prohibited under section 5
of the Federal Trade Commission Act and shall
be enforced by the Federal Trade Commission in
the same manner, by the same means, and with
the same jurisdiction as though all applicable
terms and provisions of the Federal Trade
Commission Act were incorporated into and made
a part of this subsection.
``(ii) Inapplicability.--Subchapter A of
chapter VII shall not apply with respect to
this subsection.
``(D) Definitions.--In this subsection:
``(i) Agreement.--The term `agreement' means
anything that would constitute an agreement
under section 5 of the Federal Trade Commission
Act.
``(ii) Agreement resolving or settling.--The
term `agreement resolving or settling', in
reference to a patent infringement claim,
includes any agreement that is contingent upon,
provides a contingent condition for, or is
otherwise related to the resolution or
settlement of the claim.
``(iii) ANDA.--The term `ANDA' means an
abbreviated new drug application for the
approval of a new drug under section (j).
``(iv) ANDA filer.--The term `ANDA filer'
means a party that has filed an ANDA with the
Food and Drug Administration.
``(v) Patent infringement.--The term `patent
infringement' means infringement of any patent
or of any filed patent application, extension,
reissuance, renewal, division, continuation,
continuation in part, reexamination, patent
term restoration, patent of addition, or
extension thereof.
``(vi) Patent infringement claim.--The term
`patent infringement claim' means any
allegation made to an ANDA filer, whether or
not included in a complaint filed with a court
of law, that its ANDA or drug to be
manufactured under such ANDA may infringe any
patent.
``(2) FTC rulemaking.--The Federal Trade Commission may, by
rule promulgated under section 553 of title 5, United States
Code, exempt certain agreements described in paragraph (1) from
the requirements of this subsection if the Commission finds
such agreements to be in furtherance of market competition and
for the benefit of consumers. Consistent with the authority of
the Commission, such rules may include interpretive rules and
general statements of policy with respect to the practices
prohibited under paragraph (1).''.
(b) Notice and Certification of Agreements.--
(1) Notice of all agreements.--Section 1112(c)(2) of the
Medicare Prescription Drug, Improvement, and Modernization Act
of 2003 (21 U.S.C. 3155 note) is amended by--
(A) striking ``the Commission the'' and inserting the
following: ``the Commission--
``(A) the'';
(B) striking the period at the end and inserting ``;
and''; and
(C) adding at the end the following:
``(B) any other agreement the parties enter into
within 30 days of entering into an agreement covered by
subsection (a) or (b).''.
(2) Certification of agreements.--Section 1112 of such Act is
amended by adding at the end the following:
``(d) Certification.--The chief executive officer or the company
official responsible for negotiating any agreement required to be filed
under subsection (a), (b), or (c) shall execute and file with the
Assistant Attorney General and the Commission a certification as
follows: `I declare under penalty of perjury that the following is true
and correct: The materials filed with the Federal Trade Commission and
the Department of Justice under section 1112 of subtitle B of title XI
of the Medicare Prescription Drug, Improvement, and Modernization Act
of 2003, with respect to the agreement referenced in this
certification: (1) represent the complete, final, and exclusive
agreement between the parties; (2) include any ancillary agreements
that are contingent upon, provide a contingent condition for, or are
otherwise related to, the referenced agreement; and (3) include written
descriptions of any oral agreements, representations, commitments, or
promises between the parties that are responsive to subsection (a) or
(b) of such section 1112 and have not been reduced to writing.'.''.
(c) GAO Study.--
(1) Study.--Beginning 2 years after the date of enactment of
this Act, and each year for a period of 4 years thereafter, the
Comptroller General shall conduct a study on the litigation in
United States courts during the period beginning years prior to
the date of enactment of this Act relating to patent
infringement claims involving generic drugs, the number of
patent challenges initiated by manufacturers of generic drugs,
and the number of settlements of such litigation. The
Comptroller General shall transmit to Congress a report of the
findings of such a study and an analysis of the effect of the
amendments made by subsections (a) and (b) on such litigation,
whether such amendments have had an effect on the number and
frequency of claims settled, and whether such amendments
resulted in earlier or delayed entry of generic drugs to
market, including whether any harm or benefits to consumers has
resulted.
(2) Disclosure of agreements.--Notwithstanding any other law,
agreements filed under section 1112 of the Medicare
Prescription Drug, Improvement, and Modernization Act of 2003
(21 U.S.C. 355 note), or unaggregated information from such
agreements, shall be disclosed to the Comptroller General for
purposes of the study under paragraph (1) within 30 days of a
request by the Comptroller General.
PART 2--BIOSIMILARS
SEC. 2565. LICENSURE PATHWAY FOR BIOSIMILAR BIOLOGICAL PRODUCTS.
(a) Licensure of Biological Products as Biosimilar or
Interchangeable.--Section 351 of the Public Health Service Act (42
U.S.C. 262) is amended--
(1) in subsection (a)(1)(A), by inserting ``under this
subsection or subsection (k)'' after ``biologics license''; and
(2) by adding at the end the following:
``(k) Licensure of Biological Products as Biosimilar or
Interchangeable.--
``(1) In general.--Any person may submit an application for
licensure of a biological product under this subsection.
``(2) Content.--
``(A) In general.--
``(i) Required information.--An application
submitted under this subsection shall include
information demonstrating that--
``(I) the biological product is
biosimilar to a reference product based
upon data derived from--
``(aa) analytical studies
that demonstrate that the
biological product is highly
similar to the reference
product notwithstanding minor
differences in clinically
inactive components;
``(bb) animal studies
(including the assessment of
toxicity); and
``(cc) a clinical study or
studies (including the
assessment of immunogenicity
and pharmacokinetics or
pharmacodynamics) that are
sufficient to demonstrate
safety, purity, and potency in
1 or more appropriate
conditions of use for which the
reference product is licensed
and intended to be used and for
which licensure is sought for
the biological product;
``(II) the biological product and
reference product utilize the same
mechanism or mechanisms of action for
the condition or conditions of use
prescribed, recommended, or suggested
in the proposed labeling, but only to
the extent the mechanism or mechanisms
of action are known for the reference
product;
``(III) the condition or conditions
of use prescribed, recommended, or
suggested in the labeling proposed for
the biological product have been
previously approved for the reference
product;
``(IV) the route of administration,
the dosage form, and the strength of
the biological product are the same as
those of the reference product; and
``(V) the facility in which the
biological product is manufactured,
processed, packed, or held meets
standards designed to assure that the
biological product continues to be
safe, pure, and potent.
``(ii) Determination by secretary.--The
Secretary may determine, in the Secretary's
discretion, that an element described in clause
(i)(I) is unnecessary in an application
submitted under this subsection.
``(iii) Additional information.--An
application submitted under this subsection--
``(I) shall include publicly
available information regarding the
Secretary's previous determination that
the reference product is safe, pure,
and potent; and
``(II) may include any additional
information in support of the
application, including publicly
available information with respect to
the reference product or another
biological product.
``(B) Interchangeability.--An application (or a
supplement to an application) submitted under this
subsection may include information demonstrating that
the biological product meets the standards described in
paragraph (4).
``(3) Evaluation by secretary.--Upon review of an application
(or a supplement to an application) submitted under this
subsection, the Secretary shall license the biological product
under this subsection if--
``(A) the Secretary determines that the information
submitted in the application (or the supplement) is
sufficient to show that the biological product--
``(i) is biosimilar to the reference product;
or
``(ii) meets the standards described in
paragraph (4), and therefore is interchangeable
with the reference product; and
``(B) the applicant (or other appropriate person)
consents to the inspection of the facility that is the
subject of the application, in accordance with
subsection (c).
``(4) Safety standards for determining interchangeability.--
Upon review of an application submitted under this subsection
or any supplement to such application, the Secretary shall
determine the biological product to be interchangeable with the
reference product if the Secretary determines that the
information submitted in the application (or a supplement to
such application) is sufficient to show that--
``(A) the biological product--
``(i) is biosimilar to the reference product;
and
``(ii) can be expected to produce the same
clinical result as the reference product in any
given patient; and
``(B) for a biological product that is administered
more than once to an individual, the risk in terms of
safety or diminished efficacy of alternating or
switching between use of the biological product and the
reference product is not greater than the risk of using
the reference product without such alternation or
switch.
``(5) General rules.--
``(A) One reference product per application.--A
biological product, in an application submitted under
this subsection, may not be evaluated against more than
1 reference product.
``(B) Review.--An application submitted under this
subsection shall be reviewed by the division within the
Food and Drug Administration that is responsible for
the review and approval of the application under which
the reference product is licensed.
``(C) Risk evaluation and mitigation strategies.--The
authority of the Secretary with respect to risk
evaluation and mitigation strategies under the Federal
Food, Drug, and Cosmetic Act shall apply to biological
products licensed under this subsection in the same
manner as such authority applies to biological products
licensed under subsection (a).
``(D) Restrictions on biological products containing
dangerous ingredients.--If information in an
application submitted under this subsection, in a
supplement to such an application, or otherwise
available to the Secretary shows that a biological
product--
``(i) is, bears, or contains a select agent
or toxin listed in section 73.3 or 73.4 of
title 42, section 121.3 or 121.4 of title 9, or
section 331.3 of title 7, Code of Federal
Regulations (or any successor regulations); or
``(ii) is, bears, or contains a controlled
substance in schedule I or II of section 202 of
the Controlled Substances Act, as listed in
part 1308 of title 21, Code of Federal
Regulations (or any successor regulations);
the Secretary shall not license the biological product
under this subsection unless the Secretary determines,
after consultation with appropriate national security
and drug enforcement agencies, that there would be no
increased risk to the security or health of the public
from licensing such biological product under this
subsection.
``(6) Exclusivity for first interchangeable biological
product.--Upon review of an application submitted under this
subsection relying on the same reference product for which a
prior biological product has received a determination of
interchangeability for any condition of use, the Secretary
shall not make a determination under paragraph (4) that the
second or subsequent biological product is interchangeable for
any condition of use until the earlier of--
``(A) 1 year after the first commercial marketing of
the first interchangeable biosimilar biological product
to be approved as interchangeable for that reference
product;
``(B) 18 months after--
``(i) a final court decision on all patents
in suit in an action instituted under
subsection (l)(5) against the applicant that
submitted the application for the first
approved interchangeable biosimilar biological
product; or
``(ii) the dismissal with or without
prejudice of an action instituted under
subsection (l)(5) against the applicant that
submitted the application for the first
approved interchangeable biosimilar biological
product; or
``(C)(i) 42 months after approval of the first
interchangeable biosimilar biological product if the
applicant that submitted such application has been sued
under subsection (l)(5) and such litigation is still
ongoing within such 42-month period; or
``(ii) 18 months after approval of the first
interchangeable biosimilar biological product if the
applicant that submitted such application has not been
sued under subsection (l)(5).
For purposes of this paragraph, the term `final court decision'
means a final decision of a court from which no appeal (other
than a petition to the United States Supreme Court for a writ
of certiorari) has been or can be taken.
``(7) Exclusivity for reference product.--
``(A) Effective date of biosimilar application
approval.--Approval of an application under this
subsection may not be made effective by the Secretary
until the date that is 12 years after the date on which
the reference product was first licensed under
subsection (a).
``(B) Filing period.--An application under this
subsection may not be submitted to the Secretary until
the date that is 4 years after the date on which the
reference product was first licensed under subsection
(a).
``(C) First licensure.--Subparagraphs (A) and (B)
shall not apply to a license for or approval of--
``(i) a supplement for the biological product
that is the reference product; or
``(ii) a subsequent application filed by the
same sponsor or manufacturer of the biological
product that is the reference product (or a
licensor, predecessor in interest, or other
related entity) for--
``(I) a change (not including a
modification to the structure of the
biological product) that results in a
new indication, route of
administration, dosing schedule, dosage
form, delivery system, delivery device,
or strength; or
``(II) a modification to the
structure of the biological product
that does not result in a change in
safety, purity, or potency.
``(8) Pediatric studies.--
``(A) Exclusivity.--If, before or after licensure of
the reference product under subsection (a) of this
section, the Secretary determines that information
relating to the use of such product in the pediatric
population may produce health benefits in that
population, the Secretary makes a written request for
pediatric studies (which shall include a timeframe for
completing such studies), the applicant or holder of
the approved application agrees to the request, such
studies are completed using appropriate formulations
for each age group for which the study is requested
within any such timeframe, and the reports thereof are
submitted and accepted in accordance with section
505A(d)(3) of the Federal Food, Drug, and Cosmetic Act
the period referred to in paragraph (7)(A) of this
subsection is deemed to be 12 years and 6 months rather
than 12 years.
``(B) Exception.--The Secretary shall not extend the
period referred to in subparagraph (A) of this
paragraph if the determination under section 505A(d)(3)
of the Federal Food, Drug, and Cosmetic Act is made
later than 9 months prior to the expiration of such
period.
``(C) Application of certain provisions.--The
provisions of subsections (a), (d), (e), (f), (h), (j),
(k), and (l) of section 505A of the Federal Food, Drug,
and Cosmetic Act shall apply with respect to the
extension of a period under subparagraph (A) of this
paragraph to the same extent and in the same manner as
such provisions apply with respect to the extension of
a period under subsection (b) or (c) of section 505A of
the Federal Food, Drug, and Cosmetic Act.
``(9) Guidance documents.--
``(A) In general.--The Secretary may, after
opportunity for public comment, issue guidance in
accordance, except as provided in subparagraph (B)(i),
with section 701(h) of the Federal Food, Drug, and
Cosmetic Act with respect to the licensure of a
biological product under this subsection. Any such
guidance may be general or specific.
``(B) Public comment.--
``(i) In general.--The Secretary shall
provide the public an opportunity to comment on
any proposed guidance issued under subparagraph
(A) before issuing final guidance.
``(ii) Input regarding most valuable
guidance.--The Secretary shall establish a
process through which the public may provide
the Secretary with input regarding priorities
for issuing guidance.
``(C) No requirement for application consideration.--
The issuance (or non-issuance) of guidance under
subparagraph (A) shall not preclude the review of, or
action on, an application submitted under this
subsection.
``(D) Requirement for product class-specific
guidance.--If the Secretary issues product class-
specific guidance under subparagraph (A), such guidance
shall include a description of--
``(i) the criteria that the Secretary will
use to determine whether a biological product
is highly similar to a reference product in
such product class; and
``(ii) the criteria, if available, that the
Secretary will use to determine whether a
biological product meets the standards
described in paragraph (4).
``(E) Certain product classes.--
``(i) Guidance.--The Secretary may indicate
in a guidance document that the science and
experience, as of the date of such guidance,
with respect to a product or product class (not
including any recombinant protein) does not
allow approval of an application for a license
as provided under this subsection for such
product or product class.
``(ii) Modification or reversal.--The
Secretary may issue a subsequent guidance
document under subparagraph (A) to modify or
reverse a guidance document under clause (i).
``(iii) No effect on ability to deny
license.--Clause (i) shall not be construed to
require the Secretary to approve a product with
respect to which the Secretary has not
indicated in a guidance document that the
science and experience, as described in clause
(i), does not allow approval of such an
application.
``(10) Naming.--The Secretary shall ensure that the labeling
and packaging of each biological product licensed under this
subsection bears a name that uniquely identifies the biological
product and distinguishes it from the reference product and any
other biological products licensed under this subsection
following evaluation against such reference product.
``(l) Patent Notices; Relationship to Final Approval.--
``(1) Definitions.--For the purposes of this subsection, the
term--
``(A) `biosimilar product' means the biological
product that is the subject of the application under
subsection (k);
``(B) `relevant patent' means a patent that--
``(i) expires after the date specified in
subsection (k)(7)(A) that applies to the
reference product; and
``(ii) could reasonably be asserted against
the applicant due to the unauthorized making,
use, sale, or offer for sale within the United
States, or the importation into the United
States of the biosimilar product, or materials
used in the manufacture of the biosimilar
product, or due to a use of the biosimilar
product in a method of treatment that is
indicated in the application;
``(C) `reference product sponsor' means the holder of
an approved application or license for the reference
product; and
``(D) `interested third party' means a person other
than the reference product sponsor that owns a relevant
patent, or has the right to commence or participate in
an action for infringement of a relevant patent.
``(2) Handling of confidential information.--Any entity
receiving confidential information pursuant to this subsection
shall designate one or more individuals to receive such
information. Each individual so designated shall execute an
agreement in accordance with regulations promulgated by the
Secretary. The regulations shall require each such individual
to take reasonable steps to maintain the confidentiality of
information received pursuant to this subsection and use the
information solely for purposes authorized by this subsection.
The obligations imposed on an individual who has received
confidential information pursuant to this subsection shall
continue until the individual returns or destroys the
confidential information, a court imposes a protective order
that governs the use or handling of the confidential
information, or the party providing the confidential
information agrees to other terms or conditions regarding the
handling or use of the confidential information.
``(3) Public notice by secretary.--Within 30 days of
acceptance by the Secretary of an application filed under
subsection (k), the Secretary shall publish a notice
identifying--
``(A) the reference product identified in the
application; and
``(B) the name and address of an agent designated by
the applicant to receive notices pursuant to paragraph
(4)(B).
``(4) Exchanges concerning patents.--
``(A) Exchanges with reference product sponsor.--
``(i) Within 30 days of the date of
acceptance of the application by the Secretary,
the applicant shall provide the reference
product sponsor with a copy of the application
and information concerning the biosimilar
product and its production. This information
shall include a detailed description of the
biosimilar product, its method of manufacture,
and the materials used in the manufacture of
the product.
``(ii) Within 60 days of the date of receipt
of the information required to be provided
under clause (i), the reference product sponsor
shall provide to the applicant a list of
relevant patents owned by the reference product
sponsor, or in respect of which the reference
product sponsor has the right to commence an
action of infringement or otherwise has an
interest in the patent as such patent concerns
the biosimilar product.
``(iii) If the reference product sponsor is
issued or acquires an interest in a relevant
patent after the date on which the reference
product sponsor provides the list required by
clause (ii) to the applicant, the reference
product sponsor shall identify that patent to
the applicant within 30 days of the date of
issue of the patent, or the date of acquisition
of the interest in the patent, as applicable.
``(B) Exchanges with interested third parties.--
``(i) At any time after the date on which the
Secretary publishes a notice for an application
under paragraph (3), any interested third party
may provide notice to the designated agent of
the applicant that the interested third party
owns or has rights under 1 or more patents that
may be relevant patents. The notice shall
identify at least 1 patent and shall designate
an individual who has executed an agreement in
accordance with paragraph (2) to receive
confidential information from the applicant.
``(ii) Within 30 days of the date of
receiving notice pursuant to clause (i), the
applicant shall send to the individual
designated by the interested third party the
information specified in subparagraph (A)(i),
unless the applicant and interested third party
otherwise agree.
``(iii) Within 90 days of the date of
receiving information pursuant to clause (ii),
the interested third party shall provide to the
applicant a list of relevant patents which the
interested third party owns, or in respect of
which the interested third party has the right
to commence or participate in an action for
infringement.
``(iv) If the interested third party is
issued or acquires an interest in a relevant
patent after the date on which the interested
third party provides the list required by
clause (iii), the interested third party shall
identify that patent within 30 days of the date
of issue of the patent, or the date of
acquisition of the interest in the patent, as
applicable.
``(C) Identification of basis for infringement.--For
any patent identified under clause (ii) or (iii) of
subparagraph (A) or under clause (iii) or (iv) of
subparagraph (B), the reference product sponsor or the
interested third party, as applicable--
``(i) shall explain in writing why the
sponsor or the interested third party believes
the relevant patent would be infringed by the
making, use, sale, or offer for sale within the
United States, or importation into the United
States, of the biosimilar product or by a use
of the biosimilar product in treatment that is
indicated in the application;
``(ii) may specify whether the relevant
patent is available for licensing; and
``(iii) shall specify the number and date of
expiration of the relevant patent.
``(D) Certification by applicant concerning
identified relevant patents.--Not later than 45 days
after the date on which a patent is identified under
clause (ii) or (iii) of subparagraph (A) or under
clause (iii) or (iv) of subparagraph (B), the applicant
shall send a written statement regarding each
identified patent to the party that identified the
patent. Such statement shall either--
``(i) state that the applicant will not
commence marketing of the biosimilar product
and has requested the Secretary to not grant
final approval of the application before the
date of expiration of the noticed patent; or
``(ii) provide a detailed written explanation
setting forth the reasons why the applicant
believes--
``(I) the making, use, sale, or offer
for sale within the United States, or
the importation into the United States,
of the biosimilar product, or the use
of the biosimilar product in a
treatment indicated in the application,
would not infringe the patent; or
``(II) the patent is invalid or
unenforceable.
``(5) Action for infringement involving reference product
sponsor.--If an action for infringement concerning a relevant
patent identified by the reference product sponsor under clause
(ii) or (iii) of paragraph (4)(A), or by an interested third
party under clause (iii) or (iv) of paragraph (4)(B), is
brought within 60 days of the date of receipt of a statement
under paragraph (4)(D)(ii), and the court in which such action
has been commenced determines the patent is infringed prior to
the date applicable under subsection (k)(7)(A) or (k)(8), the
Secretary shall make approval of the application effective on
the day after the date of expiration of the patent that has
been found to be infringed. If more than one such patent is
found to be infringed by the court, the approval of the
application shall be made effective on the day after the date
that the last such patent expires.''.
(b) Definitions.--Section 351(i) of the Public Health Service Act (42
U.S.C. 262(i)) is amended--
(1) by striking ``In this section, the term `biological
product' means'' and inserting the following: ``In this
section:
``(1) The term `biological product' means'';
(2) in paragraph (1), as so designated, by inserting
``protein (except any chemically synthesized polypeptide),''
after ``allergenic product,''; and
(3) by adding at the end the following:
``(2) The term `biosimilar' or `biosimilarity', in reference
to a biological product that is the subject of an application
under subsection (k), means--
``(A) that the biological product is highly similar
to the reference product notwithstanding minor
differences in clinically inactive components; and
``(B) there are no clinically meaningful differences
between the biological product and the reference
product in terms of the safety, purity, and potency of
the product.
``(3) The term `interchangeable' or `interchangeability', in
reference to a biological product that is shown to meet the
standards described in subsection (k)(4), means that the
biological product may be substituted for the reference product
without the intervention of the health care provider who
prescribed the reference product.
``(4) The term `reference product' means the single
biological product licensed under subsection (a) against which
a biological product is evaluated in an application submitted
under subsection (k).''.
(c) Products Previously Approved Under Section 505.--
(1) Requirement to follow section 351.--Except as provided in
paragraph (2), an application for a biological product shall be
submitted under section 351 of the Public Health Service Act
(42 U.S.C. 262) (as amended by this Act).
(2) Exception.--An application for a biological product may
be submitted under section 505 of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 355) if--
(A) such biological product is in a product class for
which a biological product in such product class is the
subject of an application approved under such section
505 not later than the date of enactment of this Act;
and
(B) such application--
(i) has been submitted to the Secretary of
Health and Human Services (referred to in this
Act as the ``Secretary'') before the date of
enactment of this Act; or
(ii) is submitted to the Secretary not later
than the date that is 10 years after the date
of enactment of this Act.
(3) Limitation.--Notwithstanding paragraph (2), an
application for a biological product may not be submitted under
section 505 of the Federal Food, Drug, and Cosmetic Act (21
U.S.C. 355) if there is another biological product approved
under subsection (a) of section 351 of the Public Health
Service Act that could be a reference product with respect to
such application (within the meaning of such section 351) if
such application were submitted under subsection (k) of such
section 351.
(4) Deemed approved under section 351.--An approved
application for a biological product under section 505 of the
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355) shall be
deemed to be a license for the biological product under such
section 351 on the date that is 10 years after the date of
enactment of this Act.
(5) Definitions.--For purposes of this subsection, the term
``biological product'' has the meaning given such term under
section 351 of the Public Health Service Act (42 U.S.C. 262)
(as amended by this Act).
SEC. 2566. FEES RELATING TO BIOSIMILAR BIOLOGICAL PRODUCTS.
Subparagraph (B) of section 735(1) of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 379g(1)) is amended by inserting ``, including
licensure of a biological product under section 351(k) of such Act''
before the period at the end.
Subtitle D--Community Living Assistance Services and Supports
SEC. 2571. ESTABLISHMENT OF NATIONAL VOLUNTARY INSURANCE PROGRAM FOR
PURCHASING COMMUNITY LIVING ASSISTANCE SERVICES AND
SUPPORTS.
(a) In General.--The Public Health Service Act (42 U.S.C. 201 et
seq.), as amended, is amended by adding at the end the following:
``TITLE XXXII--COMMUNITY LIVING ASSISTANCE SERVICES AND SUPPORTS
``SEC. 3201. IN GENERAL.
``The Secretary shall establish a national voluntary insurance
program to be known as the CLASS Independence Benefit Plan for
purchasing community living assistance services and supports. Such
program shall--
``(1) provide individuals who have functional limitations
with tools that will allow them--
``(A) to maintain their personal and financial
independence; and
``(B) to live in the community through a new
financing strategy for community living assistance
services and supports;
``(2) establish an infrastructure that will help address the
Nation's community living assistance services and supports
needs;
``(3) alleviate burdens on family caregivers; and
``(4) address institutional bias by providing a financing
mechanism that supports personal choice and independence to
live in the community.
``SEC. 3202. DEVELOPMENT AND MANAGEMENT OF PROGRAM.
``The Secretary shall develop the CLASS Independence Benefit Plan in
an actuarially sound manner and--
``(1) set criteria for participation in the CLASS
Independence Benefit Plan that do not restrict eligibility
based on underwriting;
``(2) establish criteria for eligibility for benefits;
``(3) establish benefit levels;
``(4) establish mechanisms for collecting and distributing
payments;
``(5) provide mechanisms to assist beneficiaries in the use
of benefits;
``(6) promulgate such regulations as are necessary to carry
out the CLASS program in accordance with this title; and
``(7) take any other action appropriate to develop, manage,
and maintain the CLASS Independence Benefit Plan, including
making adjustments to benefits paid out and premiums collected
in order to--
``(A) maintain program solvency; and
``(B) ensure the program remains deficit neutral.
``SEC. 3203. REPORT.
``The Secretary shall submit to the Congress an annual report on the
program under this title.''.
(b) Effective Date.--Title XXXII of the Public Health Service Act, as
added by subsection (a), shall take effect on the effective date of a
statute establishing a voluntary payroll deduction under the Internal
Revenue Code of 1986 to support the program authorized by such title.
Subtitle E--Miscellaneous
SEC. 2581. STATES FAILING TO ADHERE TO CERTAIN EMPLOYMENT OBLIGATIONS.
A State is eligible for Federal funds under the provisions of the
Public Health Service Act (42 U.S.C. 201 et seq.) only if the State--
(1) agrees to be subject in its capacity as an employer to
each obligation under division A of this Act and the amendments
made by such division applicable to persons in their capacity
as an employer; and
(2) assures that all political subdivisions in the State will
do the same.
SEC. 2582. STUDY, REPORT, AND TERMINATION OF DUPLICATIVE GRANT
PROGRAMS.
(a) Study.--The Secretary of Health and Human Services (in this
section referred to as the ``Secretary'') shall conduct a study to
determine if any grant program established by this division, or any
amendment made by this division, is duplicative of one or more other
Federal grant programs under the authority of the Secretary in
existence as of the date of the enactment of this Act.
(b) Report.--Not later than 1 year after the date of the enactment of
this Act, the Secretary shall submit to Congress and make available to
the public a report that contains the results of the study required
under subsection (a).
(c) Termination of Duplicative Grant Programs.--If the Secretary
determines under subsection (a) that any grant program established by
this division, or any amendment made by this division, is duplicative
of one or more other Federal grant programs under the authority of the
Secretary, the Secretary shall, to maximum extent appropriate,
terminate such other Federal grant programs not later than 180 days
after the date of the submission of the report under subsection (b).
SEC. 2583. HEALTH CENTERS UNDER PUBLIC HEALTH SERVICE ACT; LIABILITY
PROTECTIONS FOR VOLUNTEER PRACTITIONERS.
(a) In General.--Section 224 (42 U.S.C. 233) is amended--
(1) in subsection (g)(1)(A)--
(A) in the first sentence, by striking ``or
employee'' and inserting ``employee, or (subject to
subsection (k)(4)) volunteer practitioner''; and
(B) in the second sentence, by inserting ``and
subsection (k)(4)'' after ``subject to paragraph (5)'';
and
(2) in each of subsections (g), (i), (j), (l), and (m), by
striking the term ``employee, or contractor'' each place such
term appears and inserting ``employee, volunteer practitioner,
or contractor'';
(3) in subsection (g)(1)(H), by striking the term ``employee,
and contractor'' each place such term appears and inserting
``employee, volunteer practitioner, and contractor'';
(4) in subsection (l), by striking the term ``employee, or
any contractor'' and inserting ``employee, volunteer
practitioner, or contractor''; and
(5) in subsections (h)(3) and (k), by striking the term
``employees, or contractors'' each place such term appears and
inserting ``employees, volunteer practitioners, or
contractors''.
(b) Applicability; Definition.--Section 224(k) (42 U.S.C. 233(k)) is
amended by adding at the end the following paragraph:
``(4)(A) Subsections (g) through (m) apply with respect to volunteer
practitioners beginning with the first fiscal year for which an
appropriations Act provides that amounts in the fund under paragraph
(2) are available with respect to such practitioners.
``(B) For purposes of subsections (g) through (m), the term
`volunteer practitioner' means a practitioner who, with respect to an
entity described in subsection (g)(4), meets the following conditions:
``(i) The practitioner is a licensed physician, a licensed
clinical psychologist, or other licensed or certified health
care practitioner.
``(ii) At the request of such entity, the practitioner
provides services to patients of the entity, at a site at which
the entity operates or at a site designated by the entity. The
weekly number of hours of services provided to the patients by
the practitioner is not a factor with respect to meeting
conditions under this subparagraph.
``(iii) The practitioner does not for the provision of such
services receive any compensation from such patients, from the
entity, or from third-party payors (including reimbursement
under any insurance policy or health plan, or under any Federal
or State health benefits program).''.
SEC. 2584. REPORT TO CONGRESS ON THE CURRENT STATE OF PARASITIC
DISEASES THAT HAVE BEEN OVERLOOKED AMONG THE
POOREST AMERICANS.
Not later than 12 months after the date of the enactment of this Act,
the Secretary of Health and Human Services shall report to Congress on
the epidemiology of, impact of, and appropriate funding required to
address neglected diseases of poverty, including neglected parasitic
diseases identified as Chagas Disease, cysticercosis, toxocariasis,
toxoplasmosis, trichomoniasis, the soil-transmitted helminths, and
others. The report should provide the information necessary to enhance
health policy to accurately evaluate and address the threat of these
diseases.
SEC. 2585. STUDY OF IMPACT OF OPTOMETRISTS ON ACCESS TO HEALTH CARE AND
ON AVAILABILITY OF SUPPORT UNDER FEDERAL HEALTH
PROGRAMS FOR OPTOMETRY.
(a) In General.--The Secretary of Health and Human Services (in this
section referred to as the ``Secretary'') shall conduct a study with
respect to optometrists and optometry to determine--
(1) whether there is a current and projected role for, and
the impact of, optometrists in increasing access to primary eye
and vision care to underserved, rural, and senior populations;
(2) the role and impact of optometrists in the early
diagnosis and treatment of glaucoma, cataract, diabetes, and
other conditions;
(3) whether there is a need for optometrists to be recognized
and supported as primary care providers;
(4) whether there is an existence of, and the extent of, any
barriers to recruitment and participation of underrepresented
minorities in optometry, including the potential role played by
the lack of eligibility of optometrists, optometry students,
and facilities for certain Federal health programs; and
(5) the scope of Federal support for clinical optometric
education and options for enhancing that support--
(A) to address barriers to underrepresented minority
recruitment and participation in optometry; and
(B) to improve access to primary eye and vision care,
especially in underserved and rural areas.
(b) Comment on Matters Studied.--In carrying out the study under
subsection (a), the Secretary shall seek the comments of appropriate
public and private entities.
(c) Report to Congress.--Not later than 18 months after the date of
the enactment of this Act, the Secretary shall submit to the Congress a
report containing--
(1) the results of the study under subsection (a);
(2) a summary of comments received from public and private
entities under subsection (b); and
(3) recommendations for such legislation and administrative
action as the Secretary determines to be appropriate regarding
the issues studied under subsection (a).
Purpose and Summary
The purpose of H.R. 3200, the ``America's Affordable Health
Choices Act of 2009'', is to provide affordable, quality health
care for all Americans and to reduce the growth in health care
costs.
It does that in a manner consistent with President Obama's
principles for health reform: building on what works in today's
healthcare system while repairing aspects that are broken. It
provides for comprehensive reform in three key areas:
Affordable Health Care Choices
Medicare and Medicaid Improvements
Public Health and Workforce Development
AFFORDABLE HEALTH CARE CHOICES
H.R. 3200 reforms the health system by ensuring more
affordable health care choices for all Americans. It provides
for:
Strong insurance market reforms: Pre-existing
condition exclusions are prohibited; guarantee issue and
renewal is required of all health insurance; and discrimination
in coverage and premium rating based on health status, gender,
or any other personal characteristics is prohibited. Premiums
can vary only by geographic area and by age, with a limit of
2:1 variation in rate variation by age. There are limits on the
maximum out-of-pocket payments for covered benefits, and no
annual or lifetime limits on benefits.
A new national health insurance exchange:
Individuals and small groups can purchase health benefits, with
a choice among private insurers and a new public option
competing on a level playing field.
Affordability: Medicaid coverage expansions and
new sliding scale affordability credits make premiums and cost
sharing more affordable for those with income below 400% of the
federal poverty level.
Shared responsibility among individuals, employers
and government: Individuals are required to have health
coverage; employers (except for small employers) are required
to either offer qualified health benefits or make a
contribution toward the costs of health care; and new insurance
reforms and oversight by the federal and state governments
create a marketplace to foster choice and competition, while
ensuring that coverage is affordable for those who need
assistance.
MEDICARE AND MEDICAID IMPROVEMENTS
H.R. 3200 improves and strengthens Medicare and Medicaid,
provides for substantial savings and fosters long-term delivery
system reforms through those programs. It provides for:
Modernization of Medicare: Major delivery system
reforms include innovative concepts such as accountable care
organizations, medical homes, and bundling of acute and post-
acute care services. Payment incentives decrease preventable
hospital readmissions. Physician payments are improved, with a
complete reform of the sustainable growth rate formula
(eliminating the prospect of immediate, deep cuts in physician
payments), along with payment improvements for primary care
services.
Benefit improvements: The Medicare Part D ``donut
hole'' is phased out, financed by re-imposing rebates on the
drugs purchased for individuals eligible for both Medicare and
Medicaid; cost-sharing on preventive services is eliminated,
and the low income subsidy programs in Medicare improved.
Fraud and abuse protections: New tools are
provided to combat waste, fraud, and abuse in Medicare and
Medicaid, as well as in the new public option.
Payment accuracy: Overpayments to Medicare
Advantage plans are phased out, and payment systems and updates
are made more accurate for providers in Medicare, following the
recommendations of the Medicare Payment Advisory Commission and
the President's budget. In total, the changes in Medicare will
put the program on a much more solid financial growth pattern
in the future and extend the life of the Medicare Hospital
Insurance Trust Fund by five years.
Medicaid improvements: In addition to the Medicaid
coverage expansion, primary care payments are phased up to
Medicare levels to enhance beneficiary access to services, and
recommended preventive services are covered without cost-
sharing.
PUBLIC HEALTH AND WORKFORCE DEVELOPMENT
H.R. 3200 addresses critical health care access, public
health, and enhancements in the health care workforce. It
provides for:
Community health centers: A significant expansion
in community health centers to foster access to needed
services.
Workforce investments: Increased funding for the
National Health Service Corps, and for training for primary
care physicians, nurses, and public health professionals, with
special attention to workforce diversity and the needs of
health care shortage areas.
Preventive services: Improvements in research and
adoption of policy improvements in both clinical and community
preventive services, including elimination of cost-sharing on
recommended preventive services.
Public health and wellness: Investments in state,
territorial, and local public health infrastructure.
Background and Need for Legislation
Rising costs, declining insurance coverage and suboptimal
quality are evident in the U.S. healthcare system. National
healthcare spending now is approximately $2.4 trillion, or
about 17% of the gross domestic product (GDP). The U.S. Census
Bureau estimates that more than 45.7 million people were
uninsured in 2007, representing more than one-seventh of the
population. Although the United States spends substantially
more on health care per person than other industrialized
countries, it scores only average or somewhat worse on many
quality-of-care indicators.
HEALTH CARE COSTS
Escalating healthcare costs are a significant public policy
concern and key driver of calls to reform the healthcare
system. The United States spends a large and growing share of
national income on health care. In 2008, national health
spending was approximately $2.4 trillion and accounted for
nearly 17% of GDP. We spend substantially more than other
developed countries on health care, both per capita and as a
share of GDP. That strains the budgets of families, business,
and government.
Health insurance coverage is expensive and premiums have
been growing rapidly. For private-sector employer plans in
2008, the average premium for self-only and family coverage was
$4,386 and $12,298, respectively. Moreover, from 1996 to 2006,
health insurance premiums grew a cumulative 107% for self-only
coverage and 130% for family coverage. In contrast, workers'
earnings have grown more slowly. For example, over the same
time period, the average weekly earnings of private-sector
workers increased by 47%.
To attract and maintain a qualified workforce, many
businesses provide health benefits for their employees. As the
cost of insurance rises, employers face a growing challenge
paying for health benefits while managing labor costs to
succeed in a competitive market. Given that health insurance
premiums have been rising and employers on average pay a
majority of those costs, the amount that employers pay for
health insurance has been increasing both absolutely and as a
share of labor costs. For example, in 1996, private-sector
employers contributed an average of $1,650 towards the premium
for self-only coverage. By 2006, that average had grown to
$3,330; a 102% increase. In response to such conditions, some
employers offer insurance to fewer workers or stop offering it
altogether; ask employees to pay more for coverage; and reduce
benefits.
In addition, health care costs place significant pressure
on the federal and state budgets--both directly, through
spending on Medicare, Medicaid, and other programs, and
indirectly, through tax expenditures for health insurance and
expenses. The Congressional Budget Office (CBO) expects federal
outlays for Medicare and Medicaid to exceed $700 billion in
FY2009, representing about 5% of GDP. CBO projects that federal
spending on Medicare and Medicaid combined will grow from
roughly 5% of GDP today to almost 10% by 2035 and to more than
17% by 2080.
Even prior to the recent economic downturn, the Medicaid
program's financing represented a growing share of federal and
state budgets. The weakening economy is likely to exacerbate
the issue. A poor economy affects how much money states can
dedicate to the program while at the same time has the
potential to vastly increase the number of individuals who meet
the income eligibility thresholds that make them eligible for
coverage.
Underlying health care cost growth is a health care
delivery system in the United States that is highly fragmented,
with this fragmentation oftentimes reflected in a lack of
coordinated, timely, effective, or efficient care. The system
for delivering health services has arisen incrementally and has
been shaped by a range of factors, including financing
mechanisms and patterns in the supply and distribution of
resources such as health care providers.
In its June 2009 report to Congress, the Medicare Payment
Advisory Commission (MedPAC) concluded that fundamental changes
are needed in health care delivery in the United States, and in
Medicare. The Commission recommended Medicare reforms that
would, among other things, increase value, promote
accountability and care coordination, change incentives to
encourage efficiency and high quality, and set more accurate
payment rates.
In calling for action, the Council of Economic Advisors
reported in June 2009 that genuine health reform that
ultimately slowed the annual growth rate in health care costs
by just 1.5 percentage points annually would:
Increase GDP by nearly 8% in 2030;
Increase income for a typical family of four
by nearly $10,000 by 2030;
Prevent disastrous increases in the federal
budget deficit.
COVERAGE
Americans obtain health insurance in different settings and
through a variety of methods. Those aged 65 and older are
generally covered by the Medicare program, so most assessments
of coverage issues and options focus on the population under
age 65. For this population, the two dominant sources of
coverage are employment-based coverage and government programs,
largely Medicaid and the Children's Health Insurance Program
(CHIP). There is also a relatively small ``non-group'' or
individual health insurance market.
In 2007, approximately 177 million people had employment-
based health insurance. Employers who choose to offer health
coverage may either purchase insurance from a state-licensed
insurer or choose to self-fund health benefits for their
employees (most larger employers self-fund benefits).
Approximately 99% of large employers (200 or more workers)
offer health benefits to at least some of their employees.
Large employers are generally able to obtain lower premiums for
a given health insurance package than small employers and
individuals. The result is that the vast majority of large
firms typically can find and provide health insurance in the
private market, in contrast with small firms and individuals.
Less than half of all small employers (less than 50
employees) offer health insurance coverage to their employees.
These pools are generally considered to be less stable than
larger pools, as one or two employees moving in or out of the
pool (or developing an illness) would have a greater impact on
the average per-person cost of health care than they would in a
larger pool. Also, small groups lack the economies of scale and
leveraging ability available to large employers. Thus, small
employers face greater difficulties in obtaining health
insurance in the private market than large employers.
Other individuals obtain coverage on their own in the non-
group market. Depending on the applicable state laws,
individuals who purchase health insurance in the non-group
market may be rejected or face premiums that reflect their
health status, which can make premiums lower for the healthy
but higher for the sick. Even when these individuals are issued
a health insurance policy, the insurer may be allowed to
exclude coverage for pre-existing health conditions. Some
health insurers have undertaken so-called post-claims
underwriting practices, whereby the initial applications of
individuals are re-examined after a claim is filed. If errors
or omissions, even minor ones unrelated to the claim filed, are
discovered the individual may be subject to a denial of
coverage or a rescission of the policy.
In August 2008, the U.S. Census Bureau estimated that 45.7
million people had no health insurance in 2007 through
employers, individual policies or government programs. The
millions of uninsured, and underinsured, individuals in the
United States present significant challenges to public
policymakers and this lack of comprehensive coverage has served
as an impetus for reform for decades.
In calling for action, the Institute of Medicine (IOM) of
the National Academies reported in 2009 that:
Coverage is declining and will continue to
decline;
Health insurance is integral to personal
well-being and health--For people without health
insurance, there is a chasm between health care needs
and access to services, despite the availability of
some safety net services;
High levels of uninsured in communities may
undermine health care for the insured population.
Further, the University of Washington Medical School found
that a lack of health insurance causes more than 44,000 deaths
each year, after adjusting for age, gender, education,
employment status, smoking, and other factors. In addition, the
Council of Economic Advisors reported in June 2009 that
expanding insurance coverage to the uninsured would increase
net economic well-being by roughly $100 billion a year, or
about two-thirds of a percent of GDP.
QUALITY
Despite our spending far more than any other nation on
health care, the U.S. health care system is characterized by
systemic quality shortcomings.
In a 1999 study, the IOM reported that between 44,000 and
98,000 people die each year due to preventable medical errors
at a cost of between 17 and 29 billion dollars per year.
Serious adverse medication events are estimated to occur in up
to 15% of hospitalized patients and more than 100,000 deaths
are attributed annually to such reactions.
With respect to the problems of overuse, misuse, and
underuse of health care services, a study conducted by the
Midwest Business Group on Health in 2003 found that
approximately ``30 percent of all direct health care outlays
are the result of poor-quality care, consisting primarily of
overuse, misuse and waste.'' Another study found that as many
as 20% to 30% of patients received contraindicated care. A 2007
RAND study found that only 46.5% of children receive care
recommended by evidence-based guidelines and a similar RAND
study conducted in 2003 concluded that adults receive only 55%
of indicated care. Taken together, these findings evidence
significant shortfalls in the quality of care provided in the
United States.
Over the past decade, there have been numerous efforts to
improve quality of care in the United States that have engaged
a wide range of stakeholders. These efforts have generally
focused on improving and refining metrics for measuring the
quality of care delivered in a number of settings; publicly
reporting comparative information on quality performance; and,
in some cases, using metrics as the basis for payment policies
to demand provider accountability (value-based purchasing).
Despite observable progress, the most recent National
Healthcare Quality Report (2008) indicated that health care
quality is suboptimal and continues to improve at a slow pace.
Among the challenges to making further improvements are
disagreements about the utility or appropriateness of some
measures (including concerns about how the public might
interpret them), the fragmented nature of the American health
care system, and barriers to access for some groups that
complicate the work of providers.
In calling for action at the Committee's hearing in June,
2009, the Secretary of Health and Human Services, Kathleen
Sebelius, testified:
Despite the best efforts of business purchasers and
private quality improvement initiatives and the
development of standards, both government and private,
recent reports indicate that the quality of care has
actually declined in recent years. We will not be able
to achieve the quality we need without the major
reforms the President seeks. It will take a
comprehensive approach to provide the leverage needed
to improve care.
HEALTH SERVICES DELIVERY REFORM
The health reform debate has embraced a number of proposals
to improve the delivery of health care services as the vehicle
for improving value in care. MedPAC's call for fundamental
delivery reform through Medicare is noted above. Further, the
call for delivery reforms include initiatives to improve the
health care workforce; to encourage individuals to adopt
healthier lifestyles; and to change the way that physicians and
other providers treat and manage disease.
Policymakers have considered leveraging federal dollars to
selectively augment health care resources and improve the
functioning of the delivery system, targeting areas such as
emergency care, pain management, and the support of various
programs, clinics, and centers. Finally, the need for reliable,
comprehensive, and robust health data, and the federal
government's role in ensuring access to this data, has been an
important component of efforts that aim to reform the delivery
system.
PAYMENT FOR HEALTH CARE SERVICES
The inefficiencies resulting from fee-for-service payment
arrangements in American health care are well documented. Most
common in payment for physician and practitioner services, fee-
for-service rewards the provision of a high volume of services
without regard to the value of each service to a patient's
health or a patient's preferences. Overtreatment can be harmful
to a patient's health and leads to increased health spending
for the patient, businesses, and employers. Fee-for-service
also does not encourage physicians and other professionals to
collaborate to manage a patient's health needs over time.
Proposals have been offered to reform and replace fee-for-
service payments in Medicare and private health insurance.
Reformed payment methods focus on encouraging care coordination
and the provision of high-quality, rather than high-volume,
care.
In testimony before the Committee, chairman of MedPAC Glenn
Hackbarth noted:
The health care delivery system we see today is not a
true system: Care coordination is rare, specialist care
is favored over primary care, quality of care is often
poor, and costs are high and increasing at an
unsustainable rate. Part of the problem is that
Medicare's fee-for-service (FFS) payment systems reward
more care, and more complex care, without regard to the
value of that care. In addition, Medicare's payment
systems create separate payment ``silos'' (e.g.,
inpatient hospitals, physicians, post-acute care
providers) and do not encourage coordination among
providers within a silo or across the silos. We must
address those limitations--creating new payment methods
that will reward efficient use of our limited resources
and encourage the effective integration of care.
WORKFORCE
The health workforce consists of a number of providers
including physicians, physician assistants, nurses--including
nurse practitioners, nurse-midwives, registered nurses,
licensed practical or vocational nurses--pharmacists, dentists,
and allied health professionals, such as audiologists and
nutritionists. There are also a number of direct care workers
who provide health and custodial services to the
institutionalized population, and public health workers who
work in government agencies and state and local health
departments.
Policymakers and experts have expressed concerns about the
size, specialty mix, and geographic distribution of the
healthcare workforce. Although quantifying the size of these
healthcare provider shortages is a difficult endeavor, there is
agreement that certain geographic areas, such as inner cities
and rural areas, experience significant healthcare provider
shortages. For example, HHS estimates that an additional 7,000
physicians are needed in health professions shortage areas.
Shortages of specific healthcare providers such as primary care
physicians--physicians trained in the fields of family
medicine, general internal medicine, and pediatric medicine--
and nurses also exist at present. There is also broad consensus
among experts and advisory groups that there will be further
healthcare provider shortages in the future. For example, the
Health Resources and Services Administration (HRSA)--the agency
that administers the majority of health workforce programs--
estimated that by 2020 there will be shortages in a number of
physician specialties and nearly 67,000 too few primary care
physicians. Additionally, a federal advisory group on the
nursing workforce estimates that as of 2000 there was a 6%
shortage of nurses and that this shortage is expected to grow
to 20% in 2020.
The federal government has a long-standing role in
supporting workforce-related programs. Much of this support is
through grants, contracts, and loan programs authorized in the
Public Health Service Act (PHSA). PHSA Title III authorizes the
National Health Service Corps, which provides scholarship and
loan repayment to practitioners who agree to provide care in
medically underserved areas. PHSA Title VII supports the
training of health professionals, such as physicians, dentists,
physician assistants, and public health workers, through
various grants, contracts, and loan programs. PHSA Title VII
also includes programs to encourage diversity in the healthcare
workforce. PHSA Title VIII authorizes several programs to
support nursing workforce development including grant,
contract, scholarship, and loan programs to train nurses,
support nursing faculty development, and increase diversity in
the nursing workforce.
Another major source of federal workforce support is
through federal support of medical residency and fellowship
training. Specifically, Medicare, through Graduate Medical
Education (GME) payments to hospitals, provides more than $9
billion to educate and train about 90,000 residents, and the
U.S. Department of Veterans Affairs sponsors and funds
residency training.
Beyond these programs, the federal government supports the
healthcare workforce in a variety of other ways. For example,
Medicaid funds residency training, the armed forces offers
residencies for enlisted physicians, and the U.S. Department of
Education supports federally subsidized student loan programs
to encourage students to enter health professions.
In calling for action at the Subcommittee on Health's
hearing in March 2009, Dr. Jeffrey Harris, President of the
American College of Physicians, testified:
A fundamental goal of delivery system reform should
be to recognize and support the value of primary care
in improving outcomes; reducing preventable
overutilization of emergency rooms, hospitals and
testing facilities; and achieving overall cost savings.
WELLNESS AND PREVENTION
In the context of health, ``prevention'' may refer to a
range of activities, from a plan for a more walkable community
to an immunization, to a colonoscopy, to a diabetes management
program. Prevention activities span a continuum of stages often
referred to as primary, secondary and tertiary prevention.
Primary prevention measures are those that prevent the risk of
illness or injury entirely, or at a very early stage. These
include public health (i.e. population-based) measures such as
anti-smoking campaigns and nutrition and exercise guidelines.
Secondary measures detect health problems at an early stage,
when they are most amenable to cure. These include clinical
preventive services such as cancer screenings. Tertiary
measures are remedial, mitigating the effects of an illness or
injury once a problem has occurred. Chronic disease management
programs are sometimes referred to as tertiary prevention
measures. Workplace ``wellness'' programs may incorporate
activities at each stage of the prevention continuum.
There is increasing concern that the prevalence of chronic
diseases in the United States is on the rise, and that this
development contributes both to a growing burden of illness
among individuals, and to challenges in curbing cost growth in
health care. According to the Centers for Disease Control and
Prevention (CDC):
Chronic diseases--such as heart disease, cancer, and
diabetes--are the leading causes of death and
disability in the United States. Chronic diseases
account for 70% of all deaths in the U.S., which is 1.7
million each year. These diseases also cause major
limitations in daily living for almost 1 out of 10
Americans or about 25 million people. Although chronic
diseases are among the most common and costly health
problems, they are also among the most preventable.
Adopting healthy behaviors such as eating nutritious
foods, being physically active and avoiding tobacco use
can prevent or control the devastating effects of these
diseases.
Efforts to reform the nation's health system often include
discussion of the role of prevention in reducing the burden of
chronic diseases. Current federal law addresses prevention in
several ways, including through (1) coverage of certain
clinical preventive services under Medicare and Medicaid; (2)
community-based research, disease prevention, and health
promotion programs, which may be funded through federal grants;
(3) support of evidence reviews to determine whether specific
clinical and community prevention interventions are effective;
and (4) regulation of certain employer-provided wellness
programs in order to strike a balance between flexibility and
compliance with current federal privacy, civil rights, and
other laws.
Many chronic diseases such as obesity and heart disease are
worsened by unhealthy behaviors, and may not be amenable to
successful management or cure unless such behaviors can be
addressed. The federal government's role in encouraging healthy
behaviors is varied, and includes developing and disseminating
information for public health and medical professionals and the
general public. This includes the work of the U.S. Preventive
Services Task Force that is administered by the Agency for
Healthcare Research and Quality and that provides
recommendations about which preventive services (e.g. cancer
screenings) should be incorporated into primary care practice.
Through a variety of programs, the federal government also
provides funding and technical assistance to state, local, and
tribal health authorities and others to support community, or
population-based, prevention activities. In addition, the CDC
supports the Task Force on Community Preventive Services, which
evaluates the effectiveness of primary prevention measures, and
recommends the use of those interventions shown to be
effective. For example, work by the Task Force has identified a
number of population-based strategies that are effective in
reducing tobacco use, promoting physical activity, and
improving diabetes management, among many others.
HHS Secretary Sebelius, at the Committee on Energy and
Commerce's June 2009 hearing, called for comprehensive action
on prevention and wellness:
We must make important investments in prevention and
wellness. The old adage is true: an ounce of prevention
truly is worth a pound of cure. But for too long, we've
sunk all our resources into cures and short-changed
prevention. Preventing disease and controlling its
effects over time must be the foundation of our health
care system.
HEALTH DATA COLLECTION
Currently a wide range of public and private data systems
are used to monitor the nation's health, access to care, and
cost and quality of that care. Key federal tracking initiatives
include HealthyPeople 2010 (which tracks health promotion and
disease prevention), Health U.S. (which tracks the health
status of the nation), and the National Healthcare Quality and
National Healthcare Disparities Reports (which track the
quality of health care in the United States and disparities
related to quality of, and access to, health care).
Each of these efforts draws from a combination of
administrative data, vital records, population-based data,
provider-based data, surveillance data, and special studies.
For example, 190 data systems are used to track HealthyPeople
2010 objectives. Many, but not all, of these data systems and
sources are sponsored by the Department of Health and Human
Services, but others (such as population estimates used to
calculate rates or data on specific populations such as Native
Americans) are supported by other federal agencies (such as the
Census Bureau or the Indian Health Service). Private and global
data sources comprise other measures in the nation's health
tracking efforts. For example, comparative international data
may come from the World Health Organization or the Organization
for Economic Cooperation and Development while pharmaceutical
data or data on the managed care population may come from
private sources.
There are a large and growing number of public and private
data sources that help inform our understanding of health,
health care, and the potential effects of proposed policies. At
present time, there is no central source of information at HHS
or elsewhere, and no central repository for health data. While
there are a number of efforts to coordinate federal data (such
as interagency working groups or coordinating efforts through
the Paperwork Reduction Act) and efforts to standardize the
collection and reporting of data (through OMB data standards
and the efforts of advisory groups such as the National
Committee on Vital and Health Statistics), achieving full
coordination at the national level remains a challenge.
In calling for action at the Subcommittee on Health's
hearing in June, 2009, Jeffrey Levi of the Trust for America's
Health testified on the need for better use of information and
data:
As we enter a reformed health care system, harnessing
the power of health information technology for public
health purposes as well as health care is going to be
essential. Assuring that the American people have a
true sense of our progress . . . will require a
commitment to collecting, analyzing, and releasing in
an accessible manner, a full range of data about our
nation's health.
Legislative History
H.R. 3200 was introduced on July 14, 2009, by Committee on
Energy and Commerce Chairman Emeritus Dingell, Chairman Waxman,
Subcommittee on Health Chairman Pallone, as well as Chairman
Rangel and Subcommittee Chairman Stark of the Committee on Ways
and Means, and Chairman Miller of California and Subcommittee
Chairman Andrews from the Committee on Education and Labor.
H.R. 3200 was referred primarily to the Committee on Energy and
Commerce, and in addition to the Committees on Ways and Means,
Education and Labor, Oversight and Government Reform, and the
Budget.
During the 110th Congress, there were 17 hearings held by
the Subcommittee on Health on issues relating to healthcare
access and problems of those who are uninsured. These hearings
also explored areas of health delivery systems, cost
containment, and protecting health coverage during an economic
downturn.
In the first session of the 111th Congress, the
Subcommittee on Health held five days of oversight hearings
focused on making health care work for American families.
Hearings were held on Tuesday, March 10, 2009; Tuesday, March
17, 2009; Tuesday, March 24, 2009; Tuesday, March 31, 2009; and
Thursday, April 2, 2009.
A Discussion Draft of comprehensive health reform
legislation was circulated by the Committee to the Members of
the Committee and the public on June 19, 2009. The same
Discussion Draft was also issued by the Committee on Ways and
Means and the Committee on Education and Labor.
The Committee on Energy and Commerce and its Subcommittee
on Health held three days of legislative hearings on the
Discussion Draft. Hearings by the Subcommittee on Health were
held on Tuesday, June 23, 2009; Wednesday, June 24, 2009; and
Thursday, June 25, 2009. The full Committee held a hearing on
Wednesday, June 24, 2009, to receive testimony from the
Secretary of Health and Human Services, the Hon. Kathleen
Sebelius.
Committee Consideration
The Committee on Energy and Commerce met in open markup
session for five days to consider amendments to H.R. 3200. The
Committee met on July 16, 17, 20, 30, and 31, 2009. The
Committee adopted 78 amendments to the legislation. H.R. 3200
was ordered favorably reported to the House, amended, by a roll
call vote of 31 to 28.
Committee Votes
Clause 3(b) of rule XIII of the Rules of the House of
Representatives requires the Committee to list the record votes
on the motion to report legislation and amendments and motions
thereto. The Committee agreed to a motion by Mr. Dingell to
order H.R. 3200 favorably reported to the House, amended, by a
record vote of 31 yeas and 28 nays. The following is the
recorded votes taken during Committee consideration, including
the names of those Members voting for and against:
Committee Oversight Findings and Recommendations
In compliance with clause 3(c)(1) of rule XIII and clause
2(b)(1) of rule X of the Rules of the House of Representatives,
the Committee's oversight findings and recommendations are
reflected in the body of this report.
New Budget Authority and Congressional Budget Office Estimate
With respect to the requirements of clause 3(c)(2) of House
rule XIII and section 308(a) of the Congressional Budget Act of
1974 and with respect to requirements of clause 3(c)(3) of
House rule XIII and section 402 of the Congressional Budget Act
of 1974, the Committee anticipates that a CBO cost estimate
letter on H.R. 3200 will address these issues when the bill
proceeds to consideration on the House floor. CBO is unable to
provide a cost estimate prior to the reconciliation of the
versions of the bill as amended and reported by the three
committees of jurisdiction.
Statement of General Performance Goals and Objectives
In accordance with clause 3(c) of House rule XIII, the
Committee finds that the goal of H.R. 3200 is to increase
access to affordable quality health coverage and contain costs.
Constitutional Authority Statement
Pursuant to clause 3(d)(1) of rule XIII of the Rules of the
House of Representatives, the Committee finds that the
constitutional authority for H.R. 3200 is provided in clauses
1, 3, and 18 of Article I, section 8 of the United States
Constitution.
Earmarks and Tax and Tariff Benefits
H.R. 3200 does not contain any congressional earmarks,
limited tax benefits, or limited tariff benefits as defined in
clause 9 of rule XXI of the Rules of the House of
Representatives.
Advisory Committee Statement
The Committee finds that the legislation establishes or
authorizes the establishment of advisory committees within the
definition of 5 U.S.C. App., Section 5(b). Section 123 of the
bill establishes a Health Benefits Advisory Committee. The
Committee finds this committee is needed to make
recommendations on covered benefits and essential, enhanced,
and premium plans. Section 1191 establishes a Telehealth
Advisory Committee. The Committee finds this committee is
needed to advise the Secretary of Health and Human Services on
policies of the Centers for Medicare and Medicaid Services
regarding telehealth services. Section 1401 establishes a
Comparative Effectiveness Research Commission, which the
Committee finds is necessary to oversee and evaluate the
activities of the Center for Comparative Effectiveness Research
established by the bill.
In addition, section 2261 establishes an Advisory Committee
on Health Workforce Evaluation and Assessment. The Committee
finds this entity is needed to make recommendations to the
Secretary of Health and Human Services regarding
classifications of the health workforce; standardized
methodologies and procedures to enumerate the health workforce;
the supply, diversity, and geographic distribution of the
health workforce; retention of the health workforce; and
policies to carry out these recommendations. Section 2310
establishes a Task Force on Clinical Preventive Services, which
the Committee finds is necessary to assist the Secretary of
Health and Human Services in the review of scientific evidence
related to costs, benefits, effectiveness, and appropriateness
of clinical preventive services, gaps in such services, and
other issues relating to clinical preventive services. Section
2310 also establishes a Task Force on Community Preventive
Services, which the Committee finds is necessary to assist the
Secretary of Health and Human Services in the review of
scientific evidence related to costs, benefits, effectiveness,
and appropriateness of community preventive services, gaps in
such services, and other issues relating to community
preventive services. Section 2552 establishes the Interagency
Pain Research Coordinating Committee. The Committee finds this
entity is needed to coordinate all efforts within the
Department of Health and Human Services and other federal
agencies that relate to pain research.
Applicability of Law to the Legislative Branch
Section 102(b)(3) of Public Law 104-1, the Congressional
Accountability Act, requires a description of the application
of this bill to the legislative branch. The Committee has
determined that the bill would apply to the legislative branch
and its employees in the same way it would apply to employers
and employees in the private sector.
Federal Mandates Statement
Section 423 of the Congressional Budget and Impoundment Act
(as amended by section 101(a)(2) of the Unfunded Mandates
Reform Act, P.L. 104-4) requires a statement of whether the
provisions of the reported bill include unfunded mandates. The
Committee anticipates that this issue will be addressed in a
CBO cost estimate letter for the bill when it proceeds to
consideration on the House floor.
Committee Cost Estimate
Clause 3(d) of rule XIII of the Rules of the House of
Representatives requires an estimate and comparison of the
costs that would be incurred in carrying out H.R. 3200. The
Committee anticipates that a CBO cost estimate letter will
address these issues when the bill proceeds to consideration on
the House floor.
Section-by-Section Analysis of the Legislation
Sec. 1. Short Title; Table of Divisions, Titles, and Subtitles
The short title may be cited as the America's Affordable
Health Choices Act of 2009 . The section also provides a table
of contents for the divisions, titles, and subtitles of the
bill. This Act is divided into divisions, titles, and subtitles
as follows:
DIVISION A--AFFORDABLE HEALTH CARE CHOICES
Sec. 100. Purpose; Table of Contents of Division; General Definitions
Purpose
The purpose of this division is to provide affordable,
quality health care for all Americans and reduce the growth in
health care spending. This division achieves this purpose by
building on what works in today's health care system, while
repairing the aspects that are broken by:
Enacting strong insurance market reforms;
Creating a new Health Insurance Exchange, with
a public health insurance option alongside private
plans;
Including sliding scale affordability credits;
and
Initiating shared responsibility among
workers, employers, and the government.
This division institutes health delivery system reforms
both to increase quality and to reduce growth in health
spending so that health care becomes more affordable for
businesses, families, and government.
General Definitions (Created within this Act)
Acceptable Coverage.--a qualified health benefit
plan coverage, coverage under a grandfathered health insurance
coverage or current group health plan, Medicare Part A,
Medicaid, Military Health System, Veteran's Health Care Program
(VA), and other coverage the Secretary of HHS in coordination
with the Health Choices Commissioner sees fit.
Basic Plan.--a plan that offers the essential
benefits package's minimum requirements to be a qualified
health benefits plan approximately 70% of the actuarial value
of the benefits provided.
Cost-sharing.--includes deductibles, coinsurance,
copayments, and similar charges but does not include premiums
or any network payment differential for covered services or
spending for non-covered services.
Employment-Based Health Plan.--the term given to
group health plans (as defined in section 733(a)(1) of ERISA as
an employee welfare benefit plan to the extent that plan
provides medical care to employees or their dependents, either
directly, through insurance or otherwise)--and is comprised of
federal and state government plans, tribal plans and church
plans.
Enhanced Plan.--a plan that offers, in addition to
the level of benefits under a basic plan, a lower level of
cost-sharing equivalent to approximately 85% of the actuarial
value of the benefits provided.
Essential Benefits Package.--health benefits
coverage, consistent with the standards set forth by the
Secretary no later than 18 months after enactment of this Act.
Health Benefits Plan.--health insurance coverage
and a group health plan, including the public health insurance
option.
Health Insurance Exchange.--created by this bill
to facilitate access of individuals and employers, through a
transparent process, to a variety of choices of affordable,
quality health insurance coverage, including a public health
insurance option.
Premium Plan.--a plan that offers, in addition to
the level of benefits under a basic plan, a lower level of
cost-sharing equivalent to approximately 95% of the actuarial
value of the benefits provided.
Premium Plus Plan.--a premium plan that also
offers additional benefits, such as oral health and vision
care, all of which is approved by the Commissioner.
Qualified Health Benefits Plan (QHBP).--a health
benefits plan that meets the requirements set forth in Title I
(by the Secretary) including the public health insurance option
and cooperatives.
QHBP Offering Entity.--an entity can be any of the
following: a health benefits plan (that is a group health plan)
in which the employer is the main source of financing, health
insurance coverage which the insurance issuer is offering the
coverage (to include cooperatives), the public health insurance
option, a non-federal government plan established by the state
or political subdivision of a state, and a federal government
plan.
Public Health Insurance Option.--a public plan
(only available through the Health Insurance Exchange) with
payment rates negotiated by the Secretary. The public option
would be required to offer basic, enhanced, and premium plans,
and would be allowed to offer premium-plus plans.
Service Area, Premium Rating Area.--with respect
to health insurance coverage: (1) if not within the Health
Insurance Exchange, an area established by a QHBP offering
entity of such coverage in accordance with applicable state law
or (2) within the Health Insurance Exchange, an area
established by such entity in accordance with state law and
applicable rules set forth by the Commissioner for Exchange-
participating health benefits plans.
State.--the 50 states and the District of
Columbia.
Y1, Y2, ETC.--are numbered terms that mean 2013,
2014, and subsequent years.
TITLE I--PROTECTIONS AND STANDARDS FOR QUALIFIED HEALTH BENEFITS PLANS
Subtitle A--General Standards
Sec. 101. Requirements reforming health insurance marketplace
Current Law
Regulation of the private health insurance market is
primarily done at the state level. State regulatory authority
is broad in scope and includes requirements related to the
issuance and renewal of coverage, benefits, rating, consumer
protections, and other issues. Federal regulation of the
private market is more narrow in scope and applicable mostly to
employer-sponsored health insurance (i.e., through the Employee
Retirement Income Security Act of 1974 (ERISA)) and through
established federal minimum standards (i.e., through the
Genetic Information Nondiscrimination Act of 2008 and the Paul
Wellstone and Pete Domenici Mental Health Parity and Addiction
Equity Act of 2008, etc.).
Proposed Law
This provision would require Qualified Health Benefits
Plans (QHBPs) to meet the new federal health insurance
standards specified in subtitles B (relating to affordable
coverage), C (relating to essential benefits) and D (relating
to consumer protection) of Title I. The section also provides
terminology for the phrases ``enrollment in employment-based
health plans'' and ``individual and group health insurance
coverage.''
Sec. 102. Protecting the choice to keep current coverage
Current Law
See description under Section 101.
Proposed Law
``Grandfathered health insurance coverage'' would be
defined as individual health insurance coverage that is in
effect before the first day of Y1, as long as the insurance
carrier does not (1) enroll new individuals on or after the
first day of Y1 (would not affect subsequent enrollment of a
dependent); (2) change any terms or conditions of the
individual coverage, except as required by law; and (3) vary
the percentage increase in premiums for a risk group of
enrollees without changing the premium for all enrollees in the
same risk group at the same rate, as specified by the
Commissioner. The Commissioner would establish a 5-year grace
period beginning Y1 for existing group health plans to
transition to the new federal health insurance standards
applied to QHBPs. Limited benefits plans specified in the
provision, such as dental only, vision only, flexible spending
arrangements, and others, are unaffected by these reforms and
may continue to be sold to new applicants irrespective of other
reforms.
Individual health insurance coverage that is not
grandfathered may only be offered after the first day of Y1 as
an Exchange plan. Excepted benefits (e.g., accident or
disability insurance) could be offered as long as they are
offered and priced separately from health insurance coverage.
For purposes of the individual mandate (established under
title III of Division A), an individual would be required to
have ``acceptable coverage.'' In order for an individual health
insurance policy to be considered acceptable coverage, the
policy would be either grandfathered health insurance coverage,
in effect prior to Y1, or offered through the Exchange
(established under title II of Division A). Group health
coverage provided during the grace period would be considered
acceptable coverage.
Nothing in Division A of this bill would prevent the
offering of stand-alone dental and vision plans under state
law. The requirements of qualified health benefits plans would
not apply to a stand-alone plan that was offered and priced
separately from a qualified health benefits plan.
Subtitle B--Standards Guaranteeing Access to Affordable Coverage
Sec. 111. Prohibiting pre-existing condition exclusions
Current Law
The Health Insurance Portability and Accountability Act of
1996 (HIPAA), which amended ERISA, limits the duration that
issuers in the group market may exclude coverage for pre-
existing health conditions for ``HIPAA eligible'' individuals,
among other provisions. Group plans may impose pre-existing
condition exclusions for no longer than 12 months (18 months in
the case of a late enrollee), and must decrease that exclusion
period by the number of months an enrollee had prior
``creditable coverage.'' HIPAA outright prohibits issuers in
the individual market from excluding coverage for pre-existing
conditions for certain HIPAA eligible individuals.
All states require health issuers to reduce the period of
time when coverage for pre-existing health conditions may be
excluded, in compliance with HIPAA. As of January 2009 in the
small group market, 21 states had pre-existing condition
exclusion rules that provided consumer protection above the
federal standard. And, as of December 2008, 42 states limit the
period of time when coverage for pre-existing health conditions
may be excluded for non-HIPAA eligible enrollees in the
individual market.
Proposed Law
This provision would prohibit a qualified health benefits
plan from excluding coverage for pre-existing health
conditions, or otherwise limit or condition such coverage with
respect to an individual or dependent based on any health
status-related factors. Such factors include health status,
medical condition (including both physical and mental
illnesses), claims experience, receipt of health care, medical
history, genetic information, evidence of insurability
(including conditions arising out of acts of domestic violence)
and disability.
Sec. 112. Guaranteed issue and renewal for insured plans
Current Law
HIPAA requires that coverage sold to small groups (2-50
employees) must be sold on a guaranteed issue basis. That is,
the issuer must accept every small employer that applies for
coverage. (Guaranteed issue rules do not address premiums.)
HIPAA also guarantees that each issuer in the individual market
make at least two policies available (``guaranteed
availability'') to all HIPAA eligible individuals. In addition,
HIPAA guarantees renewal or continuation of group coverage at
the option of the plan sponsor (e.g., employer) and individual
coverage at the option of the individual, with some exceptions.
Insurers may not renew coverage under specified circumstances,
such as nonpayment of premiums or fraud.
All states require issuers to offer policies to firms with
2-50 workers on a guaranteed issue basis, in compliance with
HIPAA. As of January 2009 in the small group market, 13 states
also require issuers to offer policies on a guaranteed issue
basis to self-employed ``groups of one.'' And, as of December
2008, 15 states require issuers in the individual market to
offer some or all of their insurance products on a guaranteed
issue basis to non-HIPAA eligible individuals.
Proposed Law
This provision would require issuers to offer all health
insurance coverage on a guaranteed issue and renewal basis
beginning in Y1, whether offered through the Exchange
(established under subtitle A of Title II), through any
employment-based health plan, or otherwise. Rescissions of
coverage would be prohibited, except in cases of fraud.
Sec. 113. Insurance rating rules
Current Law
There are no federal rating rules applicable to the private
health insurance market. However, many states currently impose
rating rules on insurance carriers in the small group and
individual markets. Existing state rating rules restrict an
insurer's ability to price insurance policies according to the
risk of the person or group seeking coverage, and vary
considerably from state to state. Such restrictions may specify
the case characteristics (or risk factors) that may or may not
be considered when setting a premium, such as age. The spectrum
of existing state rating limitations ranges from pure community
rating, to adjusted (or modified) community rating to rate
bands. Some states have no limits on rating practices which
permits insurance companies to charge unlimited amounts. Pure
community rating means that premiums cannot vary based on any
characteristic related to a person's or group's risk, including
health. Adjusted community rating means that premiums cannot
vary based on health, but may vary based on other key risk
factors, such as gender or industry of work. Rate bands allow
premium variation based on health and/or age, but such
variation is limited according to a range specified by the
state. For each characteristic, the state typically specifies
the amount of allowable variation. As of January 2009 in the
small group market, one state has pure community rating rules,
eleven have adjusted community rating rules, and 35 have rate
bands. As of December 2008 in the individual market, two states
have pure community rating rules, five have adjusted community
rating rules, and eleven have rate bands.
There are no federally-established rating areas in the
private health insurance market. However, some states have
enacted rating rules that include geographic location as a
factor on which premiums may vary. In these cases, the state
has established rating areas. Typically, states use counties or
zip codes to define those areas.
Proposed Law
This provision would impose a new federal floor on rating
rules for qualified health benefits plans. QHBP premiums would
at most vary by age (by no more than a 2:1 ratio within age
categories specified by the Commissioner (established under
section 141)), premium rating area (as permitted by state
regulators or, in the case of an Exchange plan, as specified by
the Commissioner), and family enrollment (as specified under
state law and consistent with Commissioner rules).
The Commissioner, in coordination with the Secretaries of
Health and Human Services (HHS) and Labor, would conduct a
study of the large group market to examine (1) characteristics
of employers who purchase fully-insured health insurance
products and employers who self-fund health benefits, including
characteristics related to bearing risk and solvency, and (2)
the extent to which rating rules cause adverse selection in the
large group market or encourage small and mid-size employers to
self-insure health benefits. The Commissioner would submit this
report to Congress and the applicable agencies no later than 18
months after enactment, and include any recommendations to
ensure that the law does not provide incentives for small and
mid-size employers to self-insure or create adverse selection
in the risk pools of large group insurers and self-insured
employers.
Subsection (b) deals with a specific issue about
calculating the actuarial value of insurance coverage of
abortion services in plans that choose to cover them. This
provision is discussed in detail below, in the section titled
``Abortion-Related Language in Division A.''
Sec. 114. Nondiscrimination in benefits
Current Law
HIPAA established federal rules regarding non-
discrimination based on health status-related factors. Group
issuers are prohibited from establishing rules for eligibility
and premium contributions based on health status-related
factors. Those factors include health status, medical condition
(including both physical and mental illnesses), claims
experience, receipt of health care, medical history, genetic
information, evidence of insurability (including conditions
arising out of acts of domestic violence) and disability. In
addition, the Genetic Information Nondiscrimination Act of 2008
prohibits issuers in the individual health insurance market
from establishing eligibility rules (including continued
eligibility) based on an individual's genetic information. The
Mental Health Parity Act of 1996, as amended, establishes
parity by prohibiting the placement of a dollar limit (either
annual or aggregate lifetime) on mental health benefits that is
less than such a limit for medical/surgical benefits for groups
with more than 50 employees.
Proposed Law
This provision would require QHBPs to comply with new
nondiscrimination standards regarding health benefits or
benefit structures established by the Commissioner, building on
existing federal nondiscrimination rules in ERISA, the Public
Health Service Act (PHSA), and the Internal Revenue Code of
1986. These standards would apply to plans offered to
individuals and groups of all sizes in QHBPs, not just groups
with over 50 employees. This provision would apply existing
mental health parity rules regardless of whether coverage is
offered in the individual or group market and size of employer.
Sec. 115. Ensuring adequacy of provider networks
Current Law
HIPAA established special rules for plans that develop a
network of providers. It allows small group issuers to (1)
limit the employers that apply for coverage to those firms with
eligible individuals who live or work in the network service
area, and (2) deny coverage to small employers if the issuer
demonstrates (if required) to the state that it has limited
provider capacity due to obligations to existing enrollees and
it is applying this decision uniformly without regard to claims
experience or health status-related factors. HIPAA also
prohibits a small group issuer that has denied coverage in any
service area to offer small group coverage in that area for 180
days after the denial.
Proposed Law
This provision would require QHBPs that use provider
networks to meet provider network standards that may be
established by the Commissioner to ensure the adequacy of
networks, and transparency in the cost-sharing differences
between in- and out-of-network coverage. The term ``provider
network'' means the providers with respect to covered benefits,
treatments, and services available under a health benefit plan.
Sec. 116. Ensuring value and lower premiums
Current Law
Medical loss ratio is the share of total premium revenue
spent on medical claims. Medigap insurance policies are private
supplemental health care policies that Medicare beneficiaries
can purchase to help cover some items, services, and cost
sharing not covered under Medicare. Medigap plans are required
to have a minimum medical loss ratio of 65% for individual
policies and 75% for group policies. In addition, some states
impose medical loss ratios or related requirements on insurers
in the individual and/or small group health insurance markets.
As of June 2008, minimum ratios required by states ranged from
55% to 80%.
Proposed Law
This provision would require QHBPs to comply with a medical
loss ratio standard to be determined by the Commissioner. For
any QHBP that does not meet such a standard, it would be
required to provide rebates to enrollees, in a manner specified
by the Commissioner, in sufficient amounts to meet such a loss
ratio. To establish the medical loss ratio standard, the
Commissioner would build on the definition and methodology,
developed by the HHS Secretary under Section 161, for
determining how to calculate such a ratio. The methodology
would set the highest ratio possible to ensure adequate QHBP
participation, competition both in and out of the Exchange, and
value for consumers so that their premium payments are used
predominately for medical claims.
Subtitle C--Standards Guaranteeing Access to Essential Benefits
Sec. 121. Coverage of essential benefits package
Current Law
There are very limited federal benefit mandates for health
insurance. These standards were added to HIPAA and are
described in the discussion of Section 122. There are more than
2,000 state-level benefit mandates that vary across the
country.
Proposed Law
This provision would require a QHBP to cover at least an
``essential benefit package.'' QHBPs could be offered in or
outside of an Exchange. QHBPs offered outside of an Exchange
would be allowed to offer additional benefits beyond those
specified in the essential benefits package. For QHBPs offered
through the Exchange, a plan offering a premium-plus level of
benefits (established under Section 203) could also provide
additional benefits.
The requirements under Division A would not affect the
offering of limited-purpose or ``excepted'' benefit plans,
including policies covering dental or vision treatment, long-
term care, workers' compensation, and other similar benefits,
if such benefit plans are offered under a separate policy,
contract, or certificate of insurance.
A QHBP would not be allowed to impose coverage restrictions
(except cost sharing) unrelated to the clinical appropriateness
of the health care items and services.
Sec. 122. Essential benefit package defined
Current Law
There are very few federally mandated benefits. The laws
that provide guidance are found in the Employee Retirement
Income Security Act (ERISA covers employer-sponsored plans),
the Public Health Service Act (PHSA covers insurance plans and
state and local government plans), and the Internal Revenue
Code (IRC covers church plans in certain circumstances). There
is no federal requirement that employers offer health
insurance, or that any plans that are offered cover any
specific benefits. However, the mandates that do exist require
that if a plan (governed by ERISA, PHSA, or IRC) covers a
particular service that is addressed in the statutes, then that
benefit must be designed in a certain way. Those mandates
include:
The Paul Wellstone and Pete Domenici Mental Health
Parity and Addiction Equity Act of 2008 (MHPA) (P.L. 110-343)
requires a large group health plan to offer parity in mental
health and substance use disorder benefits and medical and
surgical benefits with regard to annual and lifetime limits,
financial requirements and treatment limitations, but does not
require a plan to cover mental health benefits.
The Newborns' and Mothers' Health Protection Act
of 1996 (NMHPA) (P.L. 104-204) requires plans that offer
maternity coverage to pay for at least a 48-hour hospital stay
following childbirth (96-hour stay in the case of a cesarean
section).
The Women's Health and Cancer Rights Act of 1998
(P.L. 105-277) contains protections for patients who elect
breast reconstruction in connection with a mastectomy. For plan
participants and beneficiaries receiving benefits in connection
with a mastectomy, plans offering coverage for a mastectomy
must also cover reconstructive surgery and other benefits
related to a mastectomy.
The Genetic Information Nondiscrimination Act of
2008 (GINA) (P.L. 110-233) prohibits discrimination based on
genetic information by health insurers and employers. Broadly,
GINA prohibits health insurers from engaging in three
practices: (1) using genetic information about an individual to
adjust a group plan's premiums, or, in the case of individual
plans, to deny coverage, adjust premiums, or impose a pre-
existing condition exclusion; (2) requiring or requesting
genetic testing; and (3) requesting, requiring, or purchasing
genetic information for underwriting purposes. It also
prohibits employers from making hiring or firing decisions
based on genetic information.
Michelle's Law (P.L. 110-381) ensures that
dependent post secondary education students who take a
medically necessary leave of absence do not lose health
insurance coverage. The law provides that a group health plan
may not terminate a college student's health coverage simply
because the student takes a medically necessary leave of
absence from school or changes to part-time status. The leave
of absence must be medically necessary, begin while the student
is suffering from a serious illness or injury and would
otherwise result in a loss of coverage.
Although current federal law provides only a limited number
of service and coverage mandates, it does provide some guidance
toward the definition of preventive services for use by public
programs and private insurance. The U.S. Preventive Services
Task Force (USPSTF), administered by the Agency for Healthcare
Research and Quality (AHRQ), reviews scientific evidence and
makes recommendations to the health care community regarding
the use of clinical preventive services, based on evidence of
effectiveness and any harm associated with specific services.
The USPSTF grades services as ``A'' through ``D,'' or notes
that there is insufficient evidence to support a
recommendation. Clinical services graded ``A'' or ``B'' by the
USPSTF are recommended for use in clinical practice.
Similarly, the Advisory Committee on Immunization Practices
(ACIP), administered by the Centers for Disease Control and
Prevention (CDC), reviews scientific evidence and makes
recommendations to the Secretary and the CDC Director for the
routine administration of vaccines to children, adolescents,
and adults in the U.S. civilian population. The ACIP is not
explicitly authorized; rather, it is based in general
authorities of the Secretary in Titles II and III of the PHSA.
``Actuarial value'' is a summary measure of a health
insurance plan's benefit generosity. It is expressed as the
percentage of medical expenses estimated to be paid by the
insurer for a standard population and set of allowed charges.
Two plans that have the same actuarial value are ``actuarially
equivalent.'' Because these are summary measures, two plans
that are actuarially equivalent may not provide the same
benefits for any two individuals. State health insurance
regulations may include requirements expressed in terms of
actuarial value.
Proposed Law
This provision would require the essential benefits package
to cover specified items and services, limit cost sharing,
prohibit annual and lifetime limits on covered services, ensure
the adequacy of provider networks, and be equivalent (as
certified by the Office of the Actuary of the Centers for
Medicare and Medicaid Services) to the average prevailing
employer-sponsored coverage.
The essential benefits package would be required to cover
the following items and services:
Hospitalization;
Outpatient hospital and clinic services,
including emergency department services;
Services of physicians and other health
professionals;
Services, equipment, and supplies incident
to the services of a physician or health professional
in appropriate settings;
Prescription drugs;
Rehabilitative and ``habilitative'' services
(i.e., services to maintain or prevent the
deterioration of the physical, intellectual, emotional,
and social functioning of developmentally delayed
individuals);
Mental health and substance use disorder
services, including behavioral health treatments;
Preventive services, include those graded
``A'' or ``B'' by the Task Force on Clinical and
Preventive Services, as established by this Act, and
those vaccines recommended by the Director of the CDC;
Maternity care; and
Well-baby and well-child care; treatment of
a congenital or developmental deformity, disease, or
injury; and oral health, vision, and hearing services,
equipment, and supplies for those under age 21.
A qualified health benefits plan offering entity has the
option of subcontracting with other entities to provide select
benefits as is often the case currently, such as dental,
vision, and mental health benefits.
Mental health and substance use disorder services include
medically necessary and appropriate treatments, items and
services for disorders and conditions listed in the Diagnostic
and Statistical Manual of Mental Disorders (DSM) published by
the American Psychiatric Association.
Services recommended with a grade A or B grade by the Task
Force on Clinical Preventive Services (formerly the U.S.
Preventive Services Task Force) and vaccines recommended for
use by the Director of the Centers for Disease Control and
Prevention constitute a floor for preventive services in the
essential benefits package. The Health Benefits Advisory
Committee has discretion to also consider recommendations of
specialty medical associations, patient advocacy groups, and
scientific societies in making recommendations to the Secretary
of covered treatments, items and services within the essential
benefits package.
The essential benefits package would be subject to various
requirements concerning cost-sharing. The package would be
required to provide preventive items and services without cost-
sharing (including well-baby and well-child care). The annual
out-of-pocket limit in Y1 would be $5,000 for an individual and
$10,000 for a family. These limits would be annually adjusted
for inflation using the Consumer Price Index for all Urban
Consumers (CPI-U). The Secretary could consider establishing a
lower limit on cost-sharing for prescription drugs that would
be included within the global cost-sharing cap. All out-of-
pocket spending on prescription drugs would count toward both
the lower, drug-specific limit and the global limit on all
cost-sharing. The drug-specific cap could be helpful for
chronically ill patients that rely on medications to remain
healthy and avoid hospitalizations and other acute health care
services. The Secretary in setting a drug-specific limit could
do so at a level that will support medication adherence.
To the extent possible, the Benefits Advisory Committee and
the Secretary of HHS would establish cost-sharing levels using
copayments (a flat dollar fee) and not coinsurance (a
percentage fee). Cost-sharing for the Essential Benefits
Package would result in coverage equal to approximately 70% of
the actuarial value of the benefits if there were no cost-
sharing imposed.
This provision would also prohibit the requirement of
abortion services as a minimum benefit in any plan. Each plan
is to decide voluntarily on whether abortion is a covered
benefit; in the case of the public option, the Secretary is to
make that decision. This provision is discussed in detail below
in the section titled ``Abortion-Related Language in Division
A.''
Adults 21 and over would not be required to receive
separately priced stand-alone vision-only or dental-only
coverage (as defined in Section 102(c)(3)).
Sec. 123. Health Benefits Advisory Committee
Current Law
No provision.
Proposed Law
A Health Benefits Advisory Committee would be established
to recommend covered benefits and cost-sharing parameters and
the essential, enhanced, and premium plans. The Committee would
be chaired by the Surgeon General. The Committee membership
would be comprised of:
Nine members, appointed by the President,
who are neither federal employees nor officers;
Nine members, appointed by the Comptroller
General, who are neither federal employees nor
officers; and
An even number, up to eight members,
appointed by the President, who are federal employees
and officers.
The initial appointments would be made within 60 days of
enactment. Each Committee member would serve a three-year term,
except the terms of the initial appointments would be adjusted
to provide for staggered years of appointment. The members
would reflect the interests of the many diverse groups of
stakeholders so that no single interest would unduly influence
the Committee's recommendations. At a minimum, Committee
membership would reflect physicians and other health care
providers, consumer representatives, employers, labor, health
insurance issuers, experts in health care delivery, and experts
in health disparities, and government agencies. At least one
Committee member would be a practicing physician or health
professional, and another member would be an expert on
children's health. Finally, at least 25% of the Committee
members would have to be health care practitioners who
practiced in a rural area for at least the five years preceding
the appointment.
The Committee's recommendations to the Secretary on the
essential benefits package (as defined in Section 122), cost-
sharing levels for the enhanced plans and premium plans (as
defined in Section 203), and periodic updates of the package
would be required to incorporate innovation in health care. The
Committee members would also be required to consider how the
package would reduce health disparities, and would allow for
public input as part of developing its recommendations. The
Committee's initial benefit recommendations must be made to the
Secretary within one year of enactment.
In developing standards for the basic, enhanced and premium
plans, the Committee would be required to calculate cost-
sharing such that the enhanced plan would have benefits that
are actuarially equivalent to about 85% of the actuarial value
of the benefits provided in the essential benefits package, and
the premium plans would have benefits that are actuarially
equivalent to about 95% of the actuarial value of the benefits
provided in the essential benefits package.
Committee members would serve without pay, but would
receive federal travel expenses, including per diem expenses.
In addition, the Committee would be subject to the Federal
Advisory Committee Act (which provides sunshine and
transparency over advisory committee actions).
The Secretary would be required to publish all
recommendations developed pursuant to this Section in the
Federal Register and on the HHS website.
Sec. 124. Process for adoption of recommendations; adoption of benefit
standards
Current Law
No provision.
Proposed Law
This section proposes a timeline under which the Secretary
must choose whether to adopt the recommendations of the
Committee established under section 123 of this bill. Within 45
days of receiving the Committee's recommendations regarding the
essential benefits package, the Secretary would be required
either to adopt the benefit standards as written or not adopt
the benefit standards. If the Secretary does not wish to adopt
the recommendations, the Secretary shall notify the Committee
of the reasons for this decision, and provide an opportunity
for the Committee to revise and resubmit its recommendations.
The Secretary would be required to adopt an initial set of
benefit standards within 18 months of enactment. The Secretary
would be required to publish all determinations under this
section in the Federal Register. The Secretary would be
required to periodically update the benefit standards. However,
an essential benefits package that does not meet the essential
benefits requirements specified in section 122 could not be
adopted.
Sec. 125. Prohibition of discrimination in health care services based
on religious or spiritual content
Current Law
No provision.
Proposed Law
The Commissioner and insurance issuers offering health
insurance coverage through the Health Insurance Exchange shall
not discriminate in approving or covering a health care service
based on its religious or spiritual content if the services are
deductible as an eligible medical expense, as defined in the
Internal Revenue Code.
Subtitle D--Additional Consumer Protections
Sec. 131. Requiring fair marketing practices by health insurers
Current Law
States have established fair marketing standards to
regulate insurers' marketing activities.
Proposed Law
This provision would require the Commissioner to establish
uniform marketing standards for QHBPs.
Sec. 132. Requiring fair grievance and appeals mechanisms
Current Law
ERISA does not require an employer to offer health
benefits, but does mandate compliance to certain standards if
an employer chooses to offer health benefits, such as
procedures for appealing denied benefit claims. In addition, as
of February 2008, 44 states and the District of Columbia
mandate the independent review of benefit denials by an entity
outside of the health plan (``external review'').
Proposed Law
This provision would require QHBPs to provide for timely
grievance and appeals mechanisms as established by the
Commissioner consistent with sections 139 through 139B.
Sec. 133. Requiring information transparency and plan disclosure
Current Law
ERISA requires applicable health plans (as well as other
``welfare benefit'' plans) to disclose and report certain plan
information to enrollees and regulators. For example, plan
administrators must provide to enrollees a written summary plan
description (SPD) that contains the terms of the plan and the
benefits offered, including any material modifications, and the
SPD must be written in a manner that can be understood by the
average enrollee. Certain plans must file an annual report with
the Department of Labor, containing information about the
operation, funding, assets, and investments of those plans.
Proposed Law
This provision would require QHBPs to comply with
disclosure standards established by the Commissioner concerning
plan terms and conditions, claims payment policies, plan
finances, claims denials, and other information as determined
appropriate by the Commissioner. The Commissioner would require
such disclosure to be provided in plain language. QHBPs would
be required to comply with standards established by the
Commissioner to ensure transparency to a provider regarding
reimbursements between the plan and such health care provider.
A change in a QHBP could not be made without reasonable and
timely advance notice to enrollees about the change.
The purpose of the pharmacy benefit managers transparency
provision is to provide the Commissioner and QHBPs additional
information on several aspects of the performance of pharmacy
benefit managers: the spread between the price PBMs pay to
pharmacies and the ultimate cost to the PBM of drugs; the
extent to which PBMs are successful at switching patients to
less costly generic drugs; the extent and reasons for switching
patients to more expensive drugs; and the ability of PBMs to
obtain--and pass through to QHPBs--discounts, rebates, and
price concessions from drug manufacturers. Under the provision,
a QHBP would be allowed to contract with a pharmacy benefit
manager (PBM) to manage prescription drug coverage offered
under the health plan, or control costs related to such
coverage, only if as a condition of the contract the PBM is
required to annually provide to the Commissioner and QHBP, in a
form and manner to be determined by the Commissioner, certain
information on the performance of the PBM under the contract,
including the volume of prescriptions filled; aggregate average
payments made to pharmacists by the PBM, and paid to the PBM by
the QHBP, per prescription for mail order and retail sales;
discounts, rebates, and price concessions received from drug
manufacturers; volume of generic drugs dispensed; number of
instances when enrollees switched from a less expensive
prescribed drug to a more expensive prescription and the
rationale for such switches, and other information. Information
disclosed by a PBM to the Commissioner and QHBP would be
considered confidential, and the disclosure of information in a
form which discloses the identity of a specific PBM or a
specific retailer, manufacturer, or wholesaler would be
prohibited from disclosure by the Commissioner or QHBP except
for specified purposes. The intent of these confidentiality
provisions is to provide the same general level of
confidentiality for this information as is given to Medicaid
drug rebate data reported by manufactures under Section 1927 of
the Social Security Act. The Commissioner would be allowed to
publish industry-wide aggregate or average information to be
used by the Commissioner, by QHBPs, and by members of the
public in assessing the overall impact of PBMs on prescription
drug prices and spending.
Sec. 134. Application to qualified health benefits plans not offered
through the Health Insurance Exchange
Current Law
No provision.
Proposed Law
The previous disclosure and other standards would apply to
QHBPs offered outside of the Exchange only to the extent
specified by the Commissioner.
Sec. 135. Timely payment of claims
Current Law
Under Medicare Advantage (MA), private health plans are
paid a per-person amount to provide all Medicare-covered
benefits (except hospice) to beneficiaries who enroll in their
plans. MA plans include health maintenance organizations (HMOs)
and private fee-for-service (PFFS) plans, among other plan
types. MA PFFS plans--that generally do not currently contract
with providers--are required to pay 95% of ``clean claims''
within 30 days of receipt. The Centers for Medicare and
Medicaid Services (CMS) defines a clean claim as a claim that
has no defect or impropriety, and is submitted with all the
required documentation. The 30-day rule also applies to claims
submitted to any MA organization by a provider who does not
have a written contract with the plan. MA organizations are
required to pay interest on clean claims that are not paid
within 30 days. All other claims from non-contracted providers
must be paid within 60 days. MA organizations that contract
with providers (i.e., HMOs and PPOs) must include a prompt
payment provision in their contracts.
Proposed Law
This provision would require QHBPs to comply with the
prompt pay requirements applicable to Medicare Advantage plans.
Sec. 136. Standardized rules for coordination and subrogation of
benefits
Current Law
While there are no federal statutes specifying primary and
secondary payment rules for multiple insurers in the private
market, Section 1862(b) of the Social Security Act authorizes
the Medicare Secondary Payer (MSP) program, which identifies
specific conditions under which another party has primary
responsibility for payment and Medicare is only responsible for
qualified secondary payments. The statute authorizes several
methods to identify cases when an insurer other than Medicare
is the primary payer and to facilitate recoveries when
incorrect Medicare payments have been made. Under certain
conditions, the law makes Medicare the secondary payer to
insurance plans and programs for beneficiaries covered through
(1) a group health plan based on either their own or a spouse's
current employment; (2) auto and other liability insurance; (3)
no-fault liability insurance; and (4) workers' compensation
situations, including the Black Lung program. Additionally, the
Medicare statutes exclude Medicare coverage for items and
services paid for directly or indirectly by a government
entity, subject to certain limitations. This includes the
Department of Veterans Affairs, among others.
Proposed Law
The Commissioner would establish standards for the
coordination of benefits and reimbursement of payments in cases
involving individual and multiple plan coverage.
Sec. 137. Application of administrative simplification
Current Law
To support the growth of electronic record keeping and
claims processing, HIPAA's Administrative Simplification
provisions instructed the Secretary to adopt electronic format
and data standards for several routine administrative and
financial transactions between health care providers and health
plans/payers. The standards apply to health care providers (who
transmit any health information in electronic form in
connection with a HIPAA-specified transaction), health plans,
and health care clearinghouses.
Proposed Law
This provision would require QHBP-offering entities (as
defined in the bill) to comply with existing and new
administrative simplification standards under Title 11 of the
Social Security Act and adopted under Section 163 (discussed
below).
Sec. 138. Information on end-of-life planning
Current Law
No provision.
Proposed Law
This provision would require QHBP offering entities to
provide for the dissemination of information related to end-of-
life planning to individuals seeking enrollment in Exchange-
participating plans. The QHBP would be prohibited from
promoting suicide, assisted suicide, or the active hastening of
death. Moreover, the information presented would not presume
the withdrawal of treatment and would be required to include
end-of-life planning information that would maintain all or
most medical interventions. Nothing in this provision would be
construed to (1) require an individual to complete an advanced
directive, physician's order for life sustaining treatment, or
other end-of-life planning document; (2) require an individual
to consent to restrictions on the amount, duration, or scope of
medical benefits otherwise covered under a QHBP; or (3)
encourage the hastening of death or the promotion of assisted
suicide. An ``advance directive'' would be defined to include a
living will, a comfort care order, or a durable power of
attorney for health care.
Sec. 139. Utilization review activities
Current Law
Section 503 of ERISA requires every employee benefit plan
to ``provide adequate notice in writing to every participant or
beneficiary whose claim for benefits under the plan has been
denied, setting forth the specific reasons for such denial,
written in a manner calculated to be understood by the
participant'' and to ``afford a reasonable opportunity to any
participant whose claim for benefits has been denied for a full
and fair review by the appropriate named fiduciary of the
decision denying the claim.'' Regulations accompanying this
section of ERISA set out specific periods of time for private
employment-based plans to evaluate a claim and inform an
individual of its decision. While these limits do not govern
when the benefits must be paid or provided, plans are required
to pay or provide benefits within a reasonable time after a
claim is approved.
Urgent care claims must be decided as soon as possible,
taking into account the medical needs of the patient, but no
later than 72 hours after the plan receives the claim. The plan
must inform an individual within 24 hours if more information
is needed; and they have no less than 48 hours to respond. Then
the plan must decide the claim within 48 hours after the
missing information is supplied or the time to supply it has
elapsed. The plan must provide notice that a claim has been
granted or denied before the end of the time allotted for the
decision.
Pre-service claims must be decided within a reasonable
period of time appropriate to the medical circumstances, but no
later than 15 days after the plan has received the claim. The
plan may extend the time period up to an additional 15 days if,
for reasons beyond the plan's control, the decision cannot be
made within the first 15 days. If more information is
requested, the individual has at least 45 days to supply it.
The plan then must decide the claim no later than 15 days after
they are supplied with the additional information or after the
period of time allowed to supply additional information ends,
whichever comes first.
Post-service health claims must be decided within a
reasonable period of time, but not later than 30 days after the
plan has received the claim. If, because of reasons beyond the
plan's control, more time is needed to review a request, the
plan may extend the time period up to an additional 15 days.
However, the plan administrator has to let the individual know
before the end of the first 30-day period, explaining the
reason for the delay, requesting any additional information
needed, and advising when a final decision is expected. If more
information is requested, the individual has at least 45 days
to supply it. The claim then must be decided no later than 15
days after it has been supplied with the additional information
or the period of time given by the plan to do so ends,
whichever comes first. The plan must give notice that a claim
has been denied in whole or in part before the end of the time
allotted for the decision.
Proposed Law
A QHBP and a QHBP offering entity that offers a plan would
be required to conduct utilization review (UR) activities
meeting the requirements of this section. UR could be
contracted out. Those activities include procedures to monitor
or evaluate the use of coverage, clinical necessity,
appropriateness, efficacy, or efficiency of healthcare
services, procedures or settings, and include prospective
review, concurrent review, second opinions, case management,
discharge planning, and retrospective review. The UR program
would include written clinical review criteria, based on valid
clinical evidence, directed specifically at meeting the needs
of at-risk populations and covered individuals with chronic
conditions or severe illnesses. Once a service has been
specifically pre-authorized for an enrollee, it could not be
changed by a retrospective review. UR programs must be
administered by qualified health care professionals who oversee
review decisions.
The UR program would be conducted by trained personnel, who
could not be offered compensation to encourage claims denials,
and could not be conducted by the practitioner who provided
services to the individual in question, among other
restrictions. UR activities involving prior authorization of
services would be made as soon as possible in accordance with
the medical exigencies of the case, but no later than 14 days
after the request and no later than 3 business days after the
date of receipt of information necessary to make a
determination. An extension could be requested for additional
information, within 5 business days of receiving the initial
request. The deadline would then be extended to 14 days after
receiving the additional information, but no later than 28 days
after the request for prior authorization. For expedited cases
(where the individual's life, health, or ability to regain
maximum function was in jeopardy, or for continuity of care)
the deadline would be 72 hours after the request. No prior
authorization would be required for emergency services.
For concurrent review of ongoing care, the decision must be
provided no later than 1 business day after the date of receipt
of necessary information, with sufficient time for an appeal
before the service is reduced or eliminated. Plans would not be
required to provide coverage that exceeded their limitations.
In the case of UR for previously provided services, the
decision would have to be provided within 30 days of the date
of receipt of necessary information, but no later than 60 days
after the request.
Failure by a QHBP or QHBP entity to make a timely
determination would be treated as a claims denial. Denials
would have to be provided in writing, along with the reasons,
instructions on how to initiate an appeal, and the
availability, upon request, of the clinical criteria used, and
other information. Claims for benefits would mean any request
for coverage, for eligibility, or payment for items or services
under a QHBP.
Sec. 139A. Internal appeals procedures
Current Law
Under ERISA regulations, an individual covered by a private
employment-based health plan has at least 180 days to file an
appeal following an adverse benefit determination. The plan
must provide claimants, on request and free of charge, copies
of documents, records, and other information relevant to the
claim for benefits. The plan also must identify, upon request,
any medical or vocational expert whose advice was obtained by
the plan.
On appeal, claims must be reviewed by someone new who looks
at all of the information submitted and consults with qualified
medical professionals if a medical judgment is involved. This
reviewer cannot be a subordinate of the person who made the
initial decision and must give no consideration to that
decision.
Plans have specific periods of time within which to review
an appeal, depending on the type of claim. Urgent care claims
must be reviewed as soon as possible, taking into account the
medical needs of the patient, but not later than 72 hours after
the plan receives a request to review a denied claim. Pre-
service claims must be reviewed within a reasonable period of
time appropriate to the medical circumstances, but not later
than 30 days after the plan receives a request to review a
denied claim. Post-service claims must be reviewed within a
reasonable period of time, but not later than 60 days after the
plan receives a request to review a denied claim.
There are two exceptions to these time limits. In general,
single-employer collectively bargained plans may use a
collectively bargained grievance process for their claims
appeal procedure if it has provisions on filing, determination,
and review of benefit claims. Multi-employer collectively
bargained plans are given special timeframes to allow them to
schedule reviews on appeal of post-service claims and
disability claims for the regular quarterly meetings of their
boards of trustees.
Plans can require two levels of review of a denied health
claim to finish the plan's claims process. If two levels of
review are required, the maximum time for each review generally
is half of the time limit permitted for one review.
Once the decision on a claim is made following review, the
plan must provide to the claimant a written or electronic
notification of the decision. The notice must be in plain
language that can be understood by participants in the plan. It
must include all the specific reasons for the denial of the
claim on appeal, refer the individual to the plan provisions on
which the decision is based, provide information on any
additional voluntary levels of appeal, explain the right to
receive documents that are relevant to the benefit claim free
of charge, and describe rights to seek judicial review of the
plan's decision.
Proposed Law
Each QHBP and each QHPB offering entity that offers a plan
would be required to provide adequate written notice to
individuals (participants, beneficiaries and enrollees) who are
denied a claim for benefits. The notice would include specific
reasons for the denial and rights to further review or appeal.
Individuals would have no less than 180 days to file for a full
and fair review. Reviews of denied claims would be made by a
physician (for cases involving a medical judgment) or a
specialist (in the case of limited scope coverage) who is
selected by the plan and did not make the initial denial. The
QHBP offering entity would be required to complete the review
and either affirm, reverse or modify the original denial. If
the decision did not reverse the denial, the plan or issuer
would transmit a written notice stating the reason for the
decision, including a description of rights to any further
appeal. Failure to issue such a decision by the deadline would
be treated as final decision denying the claim.
Generally, the deadline would be 14 days after the date of
receipt of the request for internal review. An extension for
additional necessary information would be allowed if the
requestor was notified within 5 business days. The deadline
would then be extended to 14 days after receiving the
additional information, but no later than 28 days after the
request for internal review. For expedited cases (where the
individual's life, health, or ability to regain maximum
function was in jeopardy, or for continuity of care) the
deadline would be 72 hours after the request, or for ongoing
care, before the end of the approved period of care. A plan or
entity could waive its right for internal review, and in such
cases the individual could proceed directly to any applicable
external appeals process.
Sec. 139B. External appeals procedures
Current Law
No specific provision in federal law. As of February 2008,
however, 44 States and the District of Columbia mandate the
independent review of benefit denials by an entity outside of
the health plan (``external review'').
Proposed Law
A QHBP and a QHPB entity would be required to provide for
an external appeals process. An externally appealable decision
would be defined as a denial of claims based in whole or in
part on a decision that the item or service is not medically
necessary or appropriate, is investigational or experimental,
or in which the decision as to whether the benefit is covered
involved a medical judgment. It would also include a failure to
meet the applicable deadline for internal review. It would not
include specific exclusions or express limitations on the
amount, duration or scope of coverage that do not involve
medical judgment, or a decision regarding whether an individual
is a participant beneficiary or enrollee under the plan. A plan
or entity may require that external review only be conducted
after a final decision is made on internal review (except in
cases where the internal review decision is not made within
necessary deadlines). A filing fee may be required, of no more
than $25, except in cases where the individuals certify to the
Secretary that they cannot afford the fee. The fee would be
refunded if the external appeal entity reverses or modifies the
denial.
The external appeal process would be conducted under a
contract between the plan or issuer and one or more qualified
external appeal entities. Procedures would be implemented to
ensure that the external appeal entity did not have incentives
to make biased decisions. There would be a sample audit of
decisions. The Secretary would establish other terms and
conditions. A state could designate an entity to provide
external review activities.
The standards for external review would include at least
the following: (1) fair, de novo determinations; (2)
determinations of whether the decision was in accordance with
the medical needs of the patient; (3) consideration of language
in the plan or coverage documents relating to the definition of
terms, such as medical necessity; and (4) evidence from the
internal review, any personal health and medical information
supplied by the individual, the opinion of the treating
physician or health care professional. The external entity
could also take into consideration other information such as
results of studies and professional consensus. The external
appeals entity would determine whether the claim was externally
appealable and whether the decision should be expedited.
Each party could submit information. The decision would be
made no later than 21 days after the date (or 72 hours for
expedited review) of the request for an external appeal, and
written in layperson language. The appeals entity would also
inform the participant of any rights, including review by
courts. If the decision was to reverse or modify the denial,
the plan would be required to authorize benefits, take action
to provide benefits in a timely manner, and submit information
documenting compliance.
External appeals entities would have to be independent, use
a panel of at least 3 clinical peers, have sufficient medical
legal and other expertise, and meet other requirements. The
entity must be certified, and periodically recertified, as
specified by the bill. Reviewers exercising due care would not
be criminally or civilly liable for performance of their
duties.
The decision by the external appeals entity would be
binding on the plan. If the plan did not follow the decision,
it would be subject to a civil money penalty of up to $1,000
per day, until it adhered to the decision. An additional civil
monetary penalty could be assessed against a person acting in
the capacity of authorizing benefits determined by an external
review entity for any pattern or practice of repeated refusal
to authorize such benefits or for any pattern or practice of
repeated violations of requirements of this section. The
penalty would not exceed the lesser of 25% of the aggregate
value of denied benefits or $500,000.
This Act would not alter or eliminate any cause of action
or legal rights or remedies of participants, beneficiaries,
enrollees, and others under state or federal law. The
provisions of this section would apply to all acceptable
coverage in the same manner as such provisions apply with
respect to QHBPs.
Subtitle E--Governance
Sec. 141. Health Choices Administration; Health Choices Commissioner
Current Law
No provision.
Proposed Law
This provision would establish an independent agency in the
executive branch of the United States called the Health Choices
Administration (``Administration''). The Administration would
be headed by a Health Choices Commissioner (``Commissioner''),
who would be appointed by the President, with advice and
consent of the Senate. Section 702 of the Social Security Act
(detailing compensation, terms, general powers, rule-making,
and delegation as applied to the Commissioner of Social
Security and the Social Security Administration) would apply to
the Commissioner.
Sec. 142. Duties and authority of Commissioner
Current Law
No provision.
Proposed Law
This provision would make the Commissioner responsible for
carrying out the following functions:
Qualified Plan Standards.--Establishing QHBP
standards, including the enforcement of such standards in
coordination with state insurance regulators and the
Secretaries of Labor and the Treasury.
Health Insurance Exchange.--Establishing and
operating the Health Insurance Exchange.
Individual Affordability Credits.--Administering
individual affordability credits, including the determination
of eligibility for such credits.
Promoting Accountability.--Undertaking activities
in accordance with this section to promote accountability of
QHBP offering entities in meeting federal health insurance
requirements, regardless of whether such accountability is with
respect to qualified health benefit plans offered through or
outside the Health Insurance Exchange.
Compliance Examination and Audits.--Coordinating
with states to conduct audits of qualified health benefits
plans compliance with federal requirements. These audits could
include random compliance audits and targeted audits in
response to complaints or other suspected non-compliance.
Recoupment of Costs in Connection with Examination
and Audits.--Authorizing the Commissioner to recoup from
qualified health benefits plans reimbursement for costs of such
examinations and audit of such QHBP offering entities.
Data Collection.--Collecting data for the purposes
of carrying out the Commissioner's duties, including promoting
quality and value, protecting consumers, and addressing
disparities in health and health care; the Commissioner may
share such data with Secretary of Health and Human Services.
Sanctions Authority.--Providing any of the
following remedies (in addition to any other authorized by law)
in coordination with state insurance regulators and the
Secretary of Labor if it is determined that a QHBP offering
entity violates a requirement:
1. Civil money penalties of not more than the amount
applicable under similar circumstances for similar
violations under Medicare;
2. Suspension of plan enrollment of individuals under
such plan after the date the Commissioner notifies the
entity of a decision until rectification of violation;
3. In the case of an Exchange-participating health
benefits plan, suspension of payment under the Health
Insurance Exchange for individuals enrolled in the plan
after the date the Commissioner notifies the entity of
such decision and until corrective action is taken; or
4. Work with state insurance regulators to terminate
plans for repeated failure by the QHBP offering entity
to meet this title's requirements.
Standard Definitions of Insurance and Medical
Terms.--Providing the development of standards for defining
terms used in health insurance coverage, including insurance-
related terms.
Efficiency in Administration.--Issuing regulations
for the effective and efficient administration of the Health
Insurance Exchange and affordability credits including:
1. The determination of eligibility for affordability
credits.
2. The use of personnel to carry out the duties of
the Commissioner.
Sec. 143. Consultation and coordination
Current Law
No provision.
Proposed Law
The Commissioner, as appropriate, would be required to
consult with, at a minimum, the National Association of
Insurance Commissioners (including for purposes of using model
guidelines), state attorneys general, and state insurance
regulators concerning the standards and enforcement for insured
qualified health benefits plans described in this title.
Concurrently, the Commissioner would be required to consult
with, at a minimum, Indian tribes and tribal organizations,
appropriate federal agencies, and appropriate state agencies
concerning affordability credits and the offering of Exchange-
participating health benefits plans to Medicaid eligible
individuals.
The Commissioner would be required to work in coordination
with existing federal and state entities to the maximum extent
feasible and in a manner preventing conflicts of interest.
Concurrently, the Commissioner would seek to achieve uniform
standards that sufficiently protect consumers in a manner that
does not unreasonably affect employers and insurers.
Sec. 144. Health Insurance Ombudsman
Current Law
The Department of Health and Human Services houses various
complaint handling and client-assistance ombudsmen:
Food and Drug Administration (FDA) Ombudsman.--
Reviews marketing or investigational applications; provides
information on import or export issues, ensures a fair hearing
of claims of unfair or unequal treatment; also determines the
jurisdiction of a product.
Long-Term Care Ombudsman.--Mandated by Older
Americans Act of 1965, consists of 1,000 paid individuals and
14,000 volunteers who identify, investigate, and resolve
complaints made by, or on the behalf, of residents. They have a
blend of federal and state oversight.
Medicare Beneficiary Ombudsman.--Created by the
Medicare Prescription Drug, Improvement, and Modernization Act
of 2003 (P.L. 108-173), is intended to ensure those eligible
for Medicare have reliable and current information about their
benefits, rights and protections under the Medicare program,
and the procedures for getting problems and disputes resolved.
The Ombudsman is to aid Medicare recipients in filing appeals
if their insurance did not pay proper amounts for their medical
services or those services were denied.
Specialized Jurisdictional Ombudsmen.--The FDA
also has four additional ombudsmen who serve as the points of
contact for specific public complaints connected to the subject
of their jurisdiction. They are located at the Center for
Biologics Evaluation and Research, Center for Drug Evaluation
and Research, Center for Devices and Radiological Health, and
Center for Veterinary Medicine. If any of the above cannot
resolve or rectify a complaint, the issue is then sent to the
FDA Office of Ombudsman.
State Health Insurance Ombudsman.--Several states
(including VT, MN, and IL) have created State health insurance
ombudsmen, with the core responsibilities of rectifying
concerns encompassing access to care, billing problems, and
access to health insurance. The Ombudsman provides information
on state and federal programs that may be available, explains
continuation rights under an existing health plan, provides
help on how to shop for health insurance, and assists in
appealing decisions made by their health insurance.
Proposed Law
The Commissioner would appoint within the Health Choices
Administration a Qualified Health Benefits Ombudsman (with
experience and expertise in the fields of health care and
education). The Ombudsman would be required to perform the
following duties:
Receive and provide assistance with complaints,
grievances, and requests for information submitted by
individuals. The assistance would be provided more specifically
in instances such as helping individuals determine relevant
information for an appeal, assisting with any problems arising
from disenrollment, choosing a qualified health benefits plan
in which to enroll, and presenting information relevant to
affordability credits.
Submit annual reports to Congress and the
Commissioner describing the activities of the Ombudsman,
including recommendations for improvement in the Administration
of this Division, as determined appropriate. The Ombudsman
would not serve as an advocate for any increases in payments or
new coverage of services, but would identify issues and
problems in payment or coverage policies.
Subtitle F--Relation to Other Requirements; Miscellaneous
Sec. 151. Relation to other requirements
Coverage Not Offered Through Exchange.--The requirements of
this provision would not supersede specified federal and state
laws with respect to the health insurance coverage not offered
through the Health Insurance Exchange (whether or not offered
in connection with an employment-based health plan). Such laws
encompass applicable requirements under the Public Health
Service Act for certain group health plans and state and local
employee requirements for health insurance coverage, group
health plan standards and requirements under ERISA, or other
applicable federal or state laws. Nothing in this subsection
would prevent application of state laws creating private rights
of action with remedies or affect the application preemption
(under Section 514 of ERISA).
Coverage Offered Through the Exchange.--The requirements
under this title would not supersede any requirements relating
to genetic information nondiscrimination and mental health for
such health insurance coverage (as long as those related do not
prevent the application of requirements detailed in this
division; as determined by the Commissioner). Concurrently,
individual rights and remedies under state laws would apply.
Nothing detailed in this paragraph would be construed as
preventing the application of rights and remedies under state
laws with respect to any referred requirement.
Sec. 152. Prohibiting discrimination in health care
Current Law
HIPAA established federal rules regarding nondiscrimination
based on health status-related factors. It prohibits group
issuers from establishing rules for eligibility and premium
contributions based on health status-related factors. Those
factors include health status, medical condition (including
both physical and mental illnesses), claims experience, receipt
of health care, medical history, genetic information, evidence
of insurability (including conditions arising out of acts of
domestic violence) and disability. In addition, the Genetic
Information Nondiscrimination Act of 2008 (GINA, P.L. 110-233)
prohibits issuers in the individual health insurance market
from establishing eligibility rules (including continued
eligibility) based on an individual's genetic information. The
Mental Health Parity Act of 1996, as amended, establishes
parity in treatment limitations, financial requirements
including annual or lifetime limits between mental health and
substance use disorder benefits and medical and surgical
benefits.
Proposed Law
Unless explicitly permitted within this Act and subsequent
related regulations, all health care and related services
(including insurance coverage and public health activities)
covered by this Act would be provided regardless of personal
characteristics extraneous to the provision of high quality
health care or related services. Within 18 months of enactment,
the Secretary would be required to ensure that all health care
and related services would be provided without regard for
extraneous personal characteristics.
Sec. 153. Whistleblower protection
No employer may discharge (or otherwise discriminate
against) any employee with respect to his compensation, terms,
conditions, or other privileges of employment because the
employee (or an individual acting at the request of the
employee):
Provides or causes to provide to the employer,
federal government, the attorney general of a relevant state,
information relating to any violation of, or any act or
omission the employee reasonably believes to be a violation of
any provision, order, rule, or regulation promulgated under
this Act.
Testifies or is about to testify in a proceeding
concerning such violation.
Assists, participates or is about to assist or
participate in such a proceeding.
Objects to, or refuses to participate in any
activity, policy, practice, or assigned task that the employee
reasonably believes to be in violation of any provision, order,
rule or regulation promulgated under this Act.
Enforcement Action.--An employee covered by this section
who alleges discrimination by an employer in violation may
bring an action governed by the rules, procedures, legal burden
of proof, and remedies detailed in section 40(b) of the
Consumer Product Safety Act.
Employer Defined.--The term employer in this section means
any person (including one or more individuals, partnerships,
associations, corporations, trusts, professional membership
organization including a certification, disciplinary, or other
professional body, unincorporated organizations,
nongovernmental organizations, or trustees) engaged in profit
or nonprofit business or industry whose activities are governed
by this Act, and any agent, contractor, subcontractor, grantee,
or consultant of such person.
Rule of Construction.--The rule of construction set forth
concerning employee protections in the United States Code would
apply to this section.
Sec. 154. Construction regarding collective bargaining
Nothing in this division would be construed to alter or
supersede any statutory authority (or other obligation) to
engage in collective bargaining over the terms and conditions
of employment related to health care.
Sec. 155. Severability
If any provision of this Act, or the application thereof
toward any person or circumstance, is held unconstitutional,
the application of the remaining provisions would not be
affected.
Sec. 156. Application of State and Federal laws regarding abortion
Current Law
The performance of abortions is regulated by both state and
federal laws.
Proposed Law
This provision would ensure that state laws regarding the
prohibition or requirement of coverage or funding for
abortions, and state laws involving abortion-related procedural
requirements are not preempted. The provision similarly
provides that federal conscience protection and abortion-
related antidiscrimination laws would not be affected by the
bill. The rights and obligations of employees and employers
under title VII of the Civil Rights Act of 1964 would also not
be affected by the bill.
This provision is discussed in detail below in the section
entitled ``Abortion-Related Language in Division A.''
Sec. 157. Non-discrimination on abortion and respect for rights of
conscience
Current Law
Under Section 245 of the Public Health Service Act,
federal, state, and local governments are prohibited from
discriminating against health care entities that refuse to
undergo abortion training, provide such training, perform
abortions, or provide referrals for the relevant training for
abortions. Under the so-called Weldon Amendment, which has been
included in the annual appropriations measure for the
Departments of Labor, Health and Human Services (HHS), and
Education since 2004, appropriated funds may not be made
available to a federal agency or program, or to a state or
local government, that subjects any institutional or individual
health care entity to discrimination on the basis that the
entity does not provide, pay for, provide coverage of, or refer
for abortions.
Proposed Law
This provision would prohibit a federal agency or program,
or state or local government that receives federal financial
assistance under the bill, from subjecting any individual or
institutional health care entity to discrimination on the basis
that the health care entity does not provide, pay for, provide
coverage of, or refer for abortions. The provision would also
prohibit a federal agency or program, or state or local
government that receives federal financial assistance under the
bill from requiring any health plan created or regulated under
the bill to subject any individual or institutional health care
entity to discrimination on the basis that the health care
entity does not provide, pay for, provide coverage of, or refer
for abortions. The HHS Office of Civil Rights would be
designated to receive and coordinate the investigation of such
complaints. This provision is discussed in detail below in the
section titled ``Abortion-Related Language in Division A.''
Subtitle G--Early Investments
Sec. 161. Ensuring value and lower premiums
Current Law
Medical loss ratio is the share of total premium revenue
spent on medical claims. Some states impose medical loss ratios
or related requirements on insurers in the individual and/or
small group health insurance markets. As of June 2008, minimum
ratios required by states ranged from 55% to 80%. In addition,
Medigap insurance policies are private supplemental health care
policies that Medicare beneficiaries can purchase to help cover
some items, services, and cost sharing not covered under
Medicare. Medigap plans are required to have a minimum medical
loss ratio of 65% for individual policies and 75% for group
policies.
Proposed Law
Each health insurance issuer that offers health insurance
coverage in the small or large group market would be required
to provide rebates to enrollees if the coverage provided had a
medical loss ratio below a level specified by the Secretary,
for any plan year. The amount of the rebate would be sufficient
to meet such loss ratio. The methodology would be set at the
highest level medical loss ratio possible designed to ensure
adequate participation by issuers, competition in the health
insurance market, and value for consumers so that their
premiums would be used for services. The Secretary would
establish a uniform definition and a methodology for
determining medical loss ratio, taking into account special
circumstances of plans such as size, type, and longevity of the
plan. These same provisions would also apply to health
insurance coverage offered in the individual market. This
provision would be effective for plan years beginning on or
after January 1, 2011.
Sec. 162. Ending health insurance rescission abuse
Current Law
In the individual health insurance market, HIPAA guarantees
renewal or continuation of individual health coverage at the
option of the individual, except under specified circumstances.
Those circumstances include nonpayment of premiums, fraud
(including intentional misrepresentation of material fact) on
the part of the enrollee, plan termination of coverage in the
individual market, movement of enrollee outside of the network
service area, or enrollee membership in an association ending
(in the case of association sponsored coverage).
Proposed Law
This provision would clarify that the existing guaranteed
renewability rules under HIPAA include prohibition of
rescissions. An issuer would be allowed to rescind policies
only upon clear and convincing evidence of fraud. No later than
July 1, 2010, the Secretary would issue guidance on
implementing this requirement. In order for a rescission to
take effect, the issuer would be required to provide notice to
the enrollee of the proposed rescission and give that enrollee
the opportunity for a review of the determination by an
independent, external third party under procedures specified by
the Secretary. The health coverage for an enrollee who requests
such a review would remain in effect until the third party
determines such coverage may be rescinded under Secretarial
guidance. The requirements related to external review would
apply on and after October 1, 2010 to all health insurance
coverage, regardless of date of issue.
Sec. 163. Ending health insurance denials and delays of necessary
treatment for children with deformities
Current Law
See description under Section 122.
Proposed Law
This provision would require issuers of group coverage and
individual coverage that includes coverage for surgical
benefits to provide coverage for outpatient and inpatient
diagnosis and treatment of a child's congenital or
developmental deformity, disease, or injury. Any such coverage
would be subject to pre-authorization or pre-certification as
required under the health plan, and include any surgical
treatment deemed by the treating physician as medically
necessary to approximate a normal appearance. The provision
would define treatment and make conforming amendments. These
requirements would apply to group health plans for plan years
beginning on or after January 1, 2010, and to individual health
plans offered, sold, issued, renewed, in effect or operated on
or after January 1, 2010.
Sec. 164. Administrative simplification
Current Law
HIPAA's Administrative Simplification provisions required
the Secretary to adopt electronic format and data standards for
nine specified administrative and financial transactions,
including those related to enrollment in a health plan,
eligibility for a plan, and health care payment and remittance.
In addition, HIPAA directed the Secretary to adopt a standard
for transferring standard data elements among health plans for
the coordination of benefits and the sequential processing of
claims. In 2000, CMS issued an initial set of standards for
seven of the nine specified transactions and for the
coordination of benefits. As required under HIPAA, CMS
published an updated version of the standards in early 2009.
The compliance date for implementing those updated standards is
January 1, 2012.
In September 2005, CMS published a proposed rule on a
standard for electronic health care claims attachments, one of
the two remaining transactions standards required to be
adopted. A claims attachment transaction is used to request and
supply additional data necessary to adjudicate a claim and
typically includes specific clinical information that a plan
needs in order to decide whether a service should be covered.
This type of transaction is a key bridge between administrative
transactions and clinical data. The claims attachment standard
has yet to be finalized.
HIPAA's Administrative Simplification provisions also
instructed the Secretary to develop security standards to
safeguard electronic health information from unauthorized
access, use, and disclosure, and to issue standards to protect
the privacy of patient information. The HIPAA privacy rule,
which took effect in 2003, established a set of patient rights,
including the right of access to one's medical information, and
placed certain limitations of when and how health plans and
health care providers may use and disclose patient information.
The Health Information Technology for Economic and Clinical
Health (HITECH) Act, enacted earlier this year as part of the
Recovery Act, included a series of privacy and security
provisions that amended and expanded the current HIPAA
requirements. The HIPAA Administrative Simplification standards
do not apply to the use and disclosure of information by
financial institutions that are responsible for authorizing,
processing, clearing, billing, transferring or collecting
payments for premiums or health care.
Proposed Law
This provision would amend the HIPAA Administrative
Simplification provisions by adding a new section requiring the
Secretary, within two years of implementation of the updated
HIPAA electronic transactions standards (i.e., by January
2014), to adopt an additional set of financial and
administrative transactions standards to help clarify,
complete, and expand the existing requirements. The goal would
be for the standards to be unique (with no conflicting or
redundant standards), authoritative, and comprehensive,
requiring minimal augmentation by paper transactions. In
addition, the standards would describe all data elements in
unambiguous terms and not permit optional fields. They would
enable real-time (or near real-time) determination of a
patient's financial responsibility at the point of service and
adjudication of claims, and harmonize all common data elements
across transactions standards. Finally, the standards would
have to support electronic funds transfers as well as timely
and transparent claim and denial management processes, enable
providers to quickly and efficiently enroll with a health plan
so as to conduct other electronic transactions, and provide for
other requirements related to administrative simplification as
identified by the Secretary.
In developing the standards, the Secretary would be
required to build upon existing and planned standards and
regularly update the new standards. Within six months of
enactment, the Secretary would be required to submit to
Congress a plan for implementing and enforcing the new
standards within five years of enactment. The plan would have
to include a timetable for developing and regularly updating
the new standards, implementation programs to help rural and
other providers, an estimate of the funding needed to ensure
timely completion of the implementation plan, and an
enforcement process including timely investigation of
complaints, random audits, and a fair and reasonable appeals
process. The Secretary would have to ensure that all data
collected pursuant to the new standards meets the HIPAA privacy
and security requirements, as modified by the HITECH Act.
The provision would require the Secretary, within one year
of enactment, to issue a final rule to establish a standard for
health claims attachment transactions. It also would clarify
that the HIPAA standards do not apply to the use and disclosure
of information by financial institutions that process payments
unless they are business associates of health plans and
healthcare providers.
Sec. 165. Expansion of electronic transactions in Medicare
Current Law
Generally, Medicare statute prohibits payment to providers
for Part A and B claims that are not submitted electronically.
However, the Secretary is required to allow providers to submit
paper claims if they have no method for submitting claims
electronically or if they meet the definition of a small
provider or supplier. ``A'' small provider is defined as a
provider with fewer than 25 full-time employees or a physician,
practitioner, facility, or supplier with fewer than 10 full-
time employees. The Secretary also has the discretion to waive
the electronic claims submission requirement in unusual cases
that it deems appropriate.
Proposed Law
By January 1, 2015, the Secretary would be prohibited from
paying Medicare Part A and B claims that are not submitted
through electronic funds transfer or in electronic form as
specified in ASC X12 835 Health Care Payment and Remittance
Advice or subsequent standards. The exemption for providers
that have no method for submitting claims electronically, for
small providers or suppliers, and for unusual cases deemed
appropriate by the Secretary would remain in effect.
Sec. 166. Reinsurance program for retirees
Current Law
No provision in current law. Average per capita health
spending among the near elderly (55- to 64-year-olds) in 2004
was $7,787, or 50% more than spending among 45- to 54-year-olds
($5,210), and more than double that of 19- to 44-year olds
($3,370). These spending levels carry over into health
insurance costs for these age groups. In the non-group market,
average premiums for the near elderly were nearly $1,200 more
than 45- to 54-year-olds and triple that for 25- to 34-year
olds. The near elderly were more likely than their younger
adult counterparts to spend more than 10% of their after-tax
income on health care and health insurance premiums.
Proposed Law
No later than 90 days after enactment, the Secretary would
establish a temporary reinsurance program, to provide
reimbursement to assist participating employment-based plans
with the cost of providing health benefits to eligible retirees
who are 55 and older and their dependents, including eligible
and surviving spouses. Health benefits would be required to
include medical, surgical, hospital, prescription drug, and
other benefits determined by the Secretary. An eligible
employment-based plan would submit an application to the
Secretary, as required. A participating employment-based
program would submit claims for reimbursement to the Secretary,
documenting the actual cost of items and services for each
claim. Each claim would be based on the actual amount expended
by the participant. The participating employment-based plan
would take into account any negotiated price concessions, such
as discounts, subsides, and rebates. The cost of deductibles
and cost-sharing would be included in the cost of the claim,
along with the amounts paid by the plan. For any valid claim,
the Secretary would reimburse the plan for 80% of the portion
of costs above $15,000 and below $90,000. This amount would be
adjusted annually based on the percent increase in the medical
care component of the Consumer Price Index, rounded to the
nearest multiple of $1,000. Amounts paid to a participating
employment-based plan would be used to lower cost directly to
participants and beneficiaries in the form of premiums, co-
payments, deductible, co-insurance, or other out-of-pocket
costs, but would not be used to reduce the costs of an employer
maintaining the employment-based plan. The Secretary would
establish an appeals process for denied claims, procedures to
protect against fraud, waste, and abuse, and would conduct
annual audits of claims date.
The Retiree Reserve Trust Fund would be established
consisting of such amounts as appropriated or credited to the
Fund to enable the Secretary to carry out the reinsurance
program. The Secretary could request such sums as necessary to
carry out this section, not to exceed $10 billion. Amounts
appropriated and outlays from such appropriation would not be
taken into account for purpose of any budget enforcement
procedures, thus exempting the Fund from the framework of the
budget resolution and the points of order which enforce that
framework. The Secretary would have the authority to stop
taking applications or take other steps to reduce expenditures
to ensure that expenditures did not exceed available funds.
Sec. 167. Limitations on pre-existing condition exclusions in group
health plans and health insurance coverage in the group and
individual markets in advance of applicability of new
prohibition of pre-existing condition exclusions
Current Law
See description under Section 111.
Proposed Law
This provision would decrease the amount of time that
issuers of group coverage would be allowed to exclude coverage
for pre-existing health conditions, in advance of the effective
date of the wholesale prohibition against any such coverage
exclusions (established under Section 111). It would allow
group health plans to impose pre-existing condition exclusions
for no longer than 3 months (9 months in the case of a late
enrollee). Also, it would allow issuers to review only the past
30-day period for evidence of a pre-existing health condition,
as opposed to the current look-back period of six months.
Such changes would apply to group health plans beginning
after the first six months following enactment. In the case of
a collective bargaining agreement, such changes would apply
either at the date on which the last collective bargaining
agreement ends or three years after enactment, whichever is
earlier.
This provision also would prohibit coverage exclusions for
pre-existing health conditions in the individual health
insurance market, except to the extent that such exclusions
could be applied consistent with the rules relating to group
coverage, in advance of the effective date of the wholesale
prohibition against any such coverage exclusions. It would
specify the circumstances under which an issuer of individual
coverage may impose a pre-existing health condition exclusion,
and limit the duration of such exclusions to a maximum of three
months. These changes would apply to individual coverage
offered, sold, issued, renewed, in effect, or operated
beginning after the first six months following enactment.
These rules imposed on group and individual coverage would
cease to apply once such plans become subject to the
requirements under Section 111 that prohibit any exclusions for
pre-existing health conditions.
TITLE II--HEALTH INSURANCE EXCHANGE AND RELATED PROVISIONS
Subtitle A--Health Insurance Exchange
Current Law
No provision in federal law. The Health Insurance Exchange
proposal, however, has some components that are similar to the
Massachusetts Connector as an intermediary that assists
individuals in acquiring health insurance.
Proposed Law
Sec. 201. Establishment of Health Insurance Exchange; outline of
duties; definitions
A Health Insurance Exchange (``Exchange'') would be
established to facilitate access of individuals and employers
to a variety of choices of affordable, quality health insurance
coverage, including a public health insurance option. The
Exchange would exist within the Health Choices Administration
under the direction of the Health Choices Commissioner
(described above in Sections 141 and 142). As described in
greater detail in the following sections, regarding the
Exchange, the Commissioner would (1) establish standards for,
accept bids from, and negotiate and enter into contracts with
entities seeking to offer qualified health benefits plans
(QHBPs) through the Exchange, (2) facilitate outreach and
enrollment of Exchange-eligible individuals and employers, and
(3) conduct appropriate activities related to the Exchange,
including establishment of a risk pooling mechanism and
consumer protections.
Sec. 202. Exchange-eligible individuals and employers
Beginning in Y1, all individuals generally would be
eligible to obtain coverage through the Exchange, unless they
were enrolled in the following:
a group plan through a full-time employee
(including a self-employed person with at least one
employee) for which the employer makes an adequate
contribution (described below in Section 312);
Medicare;
Medicaid (except in certain cases, discussed
below).
Those enrolled in Tricare and veterans healthcare are
eligible to obtain coverage through the Exchange. Regarding
Medicaid, individuals could still participate in the Exchange
if their Medicaid eligibility was related to COBRA continuation
coverage, tuberculosis, or breast or cervical cancer. As
described in greater detail in Section 1701, Medicaid would be
expanded to cover individuals up to 133?% FPL who are not
eligible under current state Medicaid programs--called ``non-
traditional Medicaid eligible individuals'' per Section 205. A
non-traditional Medicaid eligible individual could be Exchange-
eligible if the individual was enrolled in a qualified health
benefits plan, grandfathered health insurance coverage, or
current group health plan during the six months before the
individual became a non-traditional Medicaid eligible
individual. During the period in which such an individual had
chosen to enroll in an Exchange plan, the individual would be
ineligible for regular Medicaid.
Except for the Medicaid exception described above,
individuals would lose eligibility for Exchange coverage once
they become eligible for Medicare Part A, Medicaid (although in
this case, the Commissioner could permit continued Exchange
eligibility for such limited time as the Commissioner
determines it is administratively feasible and consistent with
minimizing disruption in the individual's access to health
care), and other circumstances as the Commissioner provides.
Besides those cases, once individuals enroll in an Exchange
plan, they would continue to be eligible until they are no
longer enrolled.
Exchange-eligible employers could meet the requirements of
the employer responsibility (Section 312) by offering and
contributing adequately toward employees' enrollment through
the Exchange. Those employees would be able to choose any of
the available Exchange plans. Once employers are Exchange
eligible and enroll their employees through the Exchange, they
would continue to be Exchange eligible, unless they decided to
then offer their own qualified health benefits plan(s).
In Y1, only employers with 10 or fewer employees would be
Exchange-eligible. In Y2, employers with 20 or fewer employees
would be Exchange-eligible. Beginning in Y3, the Commissioner
could permit larger employers to participate in the Exchange.
These additional employers could be phased in or made eligible
based on the number of full-time employees or other
considerations the Commissioner deems appropriate. Employer and
other employment-related definitions would be defined by the
Commissioner.
The Commissioner would have the authority to establish
rules to deal with special situations with regard to uninsured
individuals participating as Exchange-eligible individuals and
employers, such as transition periods for individuals and
employers who gain, or lose, Exchange-eligible participation
status, and to establish grace periods for premium payment.
The Commissioner would be required to provide for periodic
surveys of Exchange-eligible individuals and employers
concerning their satisfaction with the Exchange and its plans.
The Commissioner would conduct an Exchange Access Study--a
study of access to the Health Insurance Exchange for
individuals and for employers, including individuals such as
Medicaid recipients and employers who are not eligible and
enrolled in Exchange plans. The goal of the study would be to
determine if there are significant groups and types of
individuals and employers who are not Exchange eligible but who
would have improved benefits and affordability if made
eligible. The study also would examine the terms, conditions,
and affordability of group health coverage offered by employers
and QHBP-offering insurers outside of the Exchange compared to
Exchange-participating health benefits plans, as well as the
affordability test standard for access of certain employed
individuals to coverage in the Health Insurance Exchange. The
Commissioner would submit the study to Congress by January 1 of
Y3, Y6, and thereafter, and would include in the report
recommendations regarding changes in standards for Exchange
eligibility for individuals and employers.
This section shall not be construed as affecting any
authority under title 38 of the U.S. Code, Veterans benefits,
or Chapter 55 of title 10 of the U.S. Code, Armed Forces.
By December 31, 2011, the Secretary would submit a report
to Congress comparing the benefit package offered in 2011 for
an average Children's Health Insurance Program (CHIP) plan to
the benefit standards adopted for the essential benefits
package and the affordability credits discussed under Subtitle
C. No child eligible for CHIP coverage could be enrolled in an
Exchange plan until the Secretary has certified, based on the
report and any resulting changes (if any), that QHBP coverage
meeting the essential benefits package is at least comparable
to average CHIP coverage available in 2011.
Sec. 203. Benefits package levels
The Commissioner would specify the benefits to be made
available under Exchange plans during each plan year,
consistent with this section and sections 121-134 above. The
Commissioner could not enter into a contract with an entity
wanting to offer coverage through the Exchange in a service
area(s), unless the following requirements are met:
The entity offers one Basic plan in a service
area.
If the entity offers a Basic plan in a service
area, the entity may offer one Enhanced plan for the service
area.
If the entity offers an Enhanced plan in a service
area, the entity may offer one Premium plan for the area.
If the entity offers a Premium plan for a service
area, the entity may offer one or more Premium-Plus plans for
the area.
All such plans could be offered under a single contract
with the Commissioner.
Consistent with the standards in sections 101-164 above,
the Commissioner would also establish standards for the three
primary levels of Exchange plans--Basic, Enhanced, and
Premium--and for additional benefits that may be offered in
Premium-Plus plans. Besides offering the essential benefits
package (Section 122 above) for a QHBP, Basic plan benefit
packages would be modified to provide for reduced cost-sharing
for individuals eligible for the ``affordability cost-sharing
credit,'' described below in Section 244. Excluding the credit,
the benefit package of a Basic plan would have an actuarial
value representing payment for approximately 70% of all the
covered items and services in the essential benefits package
(Section 122 above). Enhanced plans would have lower cost-
sharing than Basic plans, representing approximately 85% of the
actuarial value of all the covered items and services in the
essential benefits package. Premium plans would have lower
cost-sharing than Enhanced plans, representing approximately
95% of the actuarial value of all the covered items and
services in the essential benefits package. Premium-Plus plans
would be Premium plans that also provide additional benefits
not otherwise covered approved by the Commissioner, such as
adult oral health and adult vision care. The portion of the
premium that is attributable to such additional benefits would
be separately specified.
The Commissioner would establish a permissible range of
variation of cost-sharing for the Basic, Enhanced, and Premium
plans. Such variation would permit variations up to 10% in
cost-sharing within specific benefit categories (Section 122);
for example, with respect to a standard that provides for 20%
coinsurance, the permissible variation would be between 18% and
22% coinsurance. This would not prohibit a greater differential
in cost sharing between different benefit categories or benefit
tiers within a category such as between generic drugs and brand
name drugs.
If a state requires health insurers to offer benefits
beyond the essential benefits package, such requirements would
continue to apply to Exchange plans, but only if the state has
entered into an arrangement satisfactory to the Commissioner to
reimburse the Commissioner for the amount of any resulting net
increase in affordability premium credits (Section 243).
The Commissioner would assure that in each premium rating
area of the Exchange, at least one Exchange plan provides
coverage of both abortions for which federal funds appropriated
for the Department of Health and Human Services are permitted
and abortions for which such funds are not permitted under the
Hyde Amendment. The Commissioner would also assure that in each
premium rating area of the Exchange, at least one Exchange plan
does not provide coverage of elective abortions. If a qualified
health benefits plan did provide coverage of elective
abortions, it would have to provide assurances to the
Commissioner that affordability credits were not used to pay
for such abortions, and only premium amounts attributable to
the actuarial value described in section 113(b) were used for
such purpose. This section is discussed in detail below in the
section titled ``Abortion-Related Language in Division A.''
Sec. 204. Contracts for the offering of Exchange-participating health
benefits plans
The Commissioner would establish standards, described
below, for Exchange-participating entities and their health
benefits plans. The Commissioner would certify entities and
plans if the standards are met. The Commissioner would solicit
and review bids from QHBP-offering entities for offering
Exchange plans, negotiate with the entities, and enter into
contracts with the entities for offering plans through the
Exchange under terms negotiated between the Exchange and the
entities.
The Federal Acquisition Regulation (the principal set of
rules that govern the contracting process for the federal
government) would not apply to contracts between the
Commissioner and QHBP-offering entities for offering Exchange
plans.
The standards for Exchange-participating entities would
consist of the following requirements:
The entity must be licensed to offer health
insurance coverage under state law for each state in which it
offers coverage.
The entity must provide for reporting data/
information specified by the Commissioner, including
information necessary to administer the risk pooling mechanism
in Section 206 and information to address disparities in health
and health care.
The entity must provide for implementation of the
affordability credits provided for enrollees (described in
Sections 241-246 below).
The entity must accept all applicable enrollment
via the Exchange, subject to such exceptions (such as capacity
limitations) in accordance with the federal requirements for
QHBPs (discussed under Title I), and would notify the
Commissioner if it projects or anticipates reaching a capacity
that would result in a limitation in enrollment.
The entity must participate in the pooling
mechanism as established by the Commissioner (described in
Section 206 below).
Regarding the Basic plan offered by the entity,
the entity must contract for outpatient services with certain
federally supported health care providers. The Commissioner
would also specify how this requirement would apply to Health
Maintenance Organizations (HMOs).
The entity must provide culturally and
linguistically appropriate communication and health services.
The entity must comply with other applicable
requirements of this title specified by the Commissioner, which
would include standards regarding billing and collection
practices for premiums and grace periods and which may include
standards to ensure that the entity does not use coercive
practices to force providers not to contract with other
entities offering coverage through the Exchange.
For the contracting process, entities' bids would have to
contain the information required by the Commissioner. Contracts
would last at least one year, but could be automatically
renewed in the absence of notice of termination by either
party. The contract would provide that if the Commissioner
determines that a plan's provider network is not adequate, then
the cost-sharing charged to a person who received out-of-
network care would be the same as if the care had been provided
in-network.
In coordination with state insurance regulators, the
Commissioner would establish processes to oversee, monitor, and
enforce applicable requirements on Exchange-participating
entities and QHBPs, including plan marketing. In conjunction
with state insurance regulators, the Commissioner would
establish a process for individuals and employers to file
complaints concerning violations. The Commissioner could
terminate a contract with an entity if it fails to comply with
the requirements of this title; the Commissioner could also
impose one or more intermediate sanctions.
Any determination by the Commissioner to terminate a
contract would be made in accordance with formal investigation
and compliance procedures established by the Commissioner under
which (a) the Commissioner provides the entity with the
reasonable opportunity to develop and implement a corrective
action plan to correct the deficiencies that were the basis of
the Commissioner's determination; and (b) the Commissioner
provides the entity with reasonable notice and opportunity for
hearing (including the right to appeal an initial decision)
before terminating the contract. However, these procedures need
not apply if the Commissioner determined that a delay in
termination would pose an imminent and serious risk to the
health of individuals enrolled under the plan.
Exchange plans would be prohibited from discriminating
against any individual health care provider or health care
facility because of its willingness or unwillingness to
provide, pay for, provide coverage of, or refer for abortions.
This provision is discussed in detail below in the section
titled ``Abortion-Related Language in Division A.''
Sec. 205. Outreach and enrollment of Exchange-eligible individuals and
employers in Exchange-participating health benefits plan
Outreach. The Commissioner would conduct outreach
activities to inform and educate individuals and employers
about the Exchange and its participating health plans. Such
outreach would include outreach specific to vulnerable
populations, such as children, individuals with disabilities,
individuals with mental illness, and individuals with other
cognitive impairments.
The Commissioner could work with other entities, such as
community-based, non-profit organizations with experience
working with people who are low-income, uninsured, or from
diverse communities. The Commissioner may support and contract
with community-based non-profits to provide these services. The
Commissioner's required outreach activities would include the
following:
broadly disseminate information on Exchange-
participating plans, provided in a comparative manner
and including information on benefits, premiums, cost-
sharing, quality, provider networks, and consumer
satisfaction;
provide assistance to Exchange-eligible
individuals and employers via a toll-free telephone
hotline and an Internet website;
develop and disseminate information to
Exchange-eligible enrollees on their rights and
responsibilities;
assist Exchange-eligible individuals in
selecting plans and obtaining benefits; and
ensure the information is developed using
plain language (described in Section 133 above).
Enrollment. The Commissioner would be required to make
timely determinations of whether individuals and employers are
eligible for Exchange coverage and to establish and carry out
an enrollment process, including at community locations.
Enrollment would be permitted by mail, telephone,
electronically, or in person.
Open enrollment for individuals and employers to enroll in
an Exchange plan and affordability credits (described in
Sections 241-245 below) would be at least 30 days and would be
during September through November of each year before benefits
would begin, or such other time that would maximize the
timeliness of income verification. However, the Commissioner
would also provide for special enrollment periods to take into
account special circumstances of individuals and employers,
such as an individual who loses acceptable coverage,
experiences a change in marital or other dependent status,
moves outside the plan's service area, or experiences a
significant change in income. The Commissioner, potentially
with other appropriate entities, would be required to broadly
disseminate information on the enrollment process, including
before each enrollment period.
The Commissioner would establish a process to automatically
enroll the following individuals into an appropriate Exchange
plan (potentially involving a random assignment or some other
form of assignment that takes into account the health care
providers used by the individual, or such other relevant
factors specified by the Commissioner):
Those who have applied for affordability
credits, been determined eligible, have not opted out
from receiving such credit, and do not enroll in
another Exchange plan; and
Those enrolled in an Exchange plan that is
terminated who do not enroll in another Exchange plan.
Under the enrollment process, individuals enrolled in an
Exchange plan would pay such plans directly, not through the
Commissioner or the Exchange.
Special provisions apply to newborns born in the United
States without acceptable coverage at birth. Until other
acceptable coverage begins, the child would be considered a
non-traditional Medicaid-eligible individual (for whom the
state would be paid 100% federal reimbursement) and would be
deemed as having elected Medicaid coverage. This coverage would
end no later than the end of the month 60 days after the
child's birth; at the end of that period, if the child still
does not have acceptable coverage, the child is deemed a
traditional Medicaid-eligible individual, for whom the state
receives the regular Medicaid federal matching rate.
As of the day before the first day of Y1, CHIP-eligible
children, including targeted low-income children in a Medicaid-
expansion CHIP program, would be deemed to be Exchange
eligible. The Commissioner would notify each state in Y1
whether the Exchange could support enrollment of these
children.
A ``traditional Medicaid eligible individual'' is a
Medicaid-eligible individual excluding (1) those who are
eligible because of the expansion of Medicaid in Section 1701
of this legislation to individuals up to 133\1/3\% FPL and (2)
a childless adult who would not otherwise be classified as
categorically needy (as per current Medicaid statute, Section
1902(a)(10)(A)) or medically needy (as per current Medicaid
statute, Section 1902(a)(10)(C)) as in effect as of the day
before the date of enactment of this Act. A ``non-traditional
Medicaid-eligible individual'' is a Medicaid-eligible
individual who is not a traditional Medicaid-eligible
individual. Section 202 of the legislation includes provisions
so that a non-traditional Medicaid eligible individual could be
Exchange-eligible if the individual was enrolled in a qualified
health benefits plan, grandfathered health insurance coverage,
or current group health plan during the six months before the
individual became a non-traditional Medicaid eligible
individual. Under this section, the Commissioner would provide
these individuals with the option to enroll in Medicaid rather
than an Exchange plan and to change that election during open
enrollment periods described earlier in this section.
An Exchange-eligible individual could apply for a Medicaid-
eligibility determination. If the individual is determined to
be eligible, the Commissioner would provide for the
individual's enrollment under the state Medicaid plan in
accordance with the Medicaid memorandum of understanding. In
the case of such an enrollment, the state would provide for the
same periodic redetermination of eligibility under Medicaid
that would apply if the individual had directly applied to the
state Medicaid agency. The legislation would require the
Commissioner, in consultation with the HHS Secretary, to enter
into a memorandum of understanding with each state with respect
to coordinating enrollment of individuals in Exchange plans and
under state Medicaid programs, and to otherwise coordinate the
implementation of these provisions with respect to the Medicaid
program. This memorandum would permit the exchange of
information consistent with limitations specified in Medicaid
statute with respect to providing safeguards that restrict the
use or disclosure of information concerning applicants and
recipients to purposes directly connected with the
administration of the state Medicaid plan, and at state's
option, the exchange of information necessary to verify
eligibility for other federal programs (e.g., for free and
reduced price school lunches). None of these provisions could
be construed as permitting such memorandum to modify or vitiate
any requirement of a state Medicaid plan.
In carrying out this section, the Commissioner would
establish effective methods for communicating in plain language
and a culturally and linguistically appropriate manner.
Nothing in this division could be construed to affect the
role of enrollment agents and brokers under state law,
including with regard to the enrollment of individuals and
employers in QHBPs, including the public health insurance
option. This section preserves the ability of agents and
brokers to assist employers and individuals in selecting health
insurance available through an exchange and to enroll
individuals and employers in qualified health benefits plans,
including Exchange-participating health benefits plans and the
public health insurance option, under terms determined between
the agents and brokers and the plan. ``[E]nrollment agents or
brokers'' include individuals and private health exchanges
licensed as agents or brokers under state law to sell health
insurance. Persons or employers enrolling in qualified health
benefits plans through agents and brokers should not be
discriminated against by HHS, the Health Choices
Administration, and the Internal Revenue Service; including
individuals accessing affordability credits or fulfilling their
obligations under section 401 or employers fulfilling their
obligations under Section 312 of this Act.
Sec. 206. Other functions
The Commissioner would be required to coordinate the
distribution of affordability premium and cost-sharing credits
(described below in Sections 243-244) to the Exchange plans.
The Commissioner would also be required to establish a risk-
pooling mechanism, to adjust premium payments to Exchange plans
to take into account (in a manner specified by the
Commissioner) the differences in the risk characteristics of
individuals and employers enrolled under the Exchange plans.
An Office of the Special Inspector General for the Exchange
would be established, headed by a Special Inspector General
appointed by the President and confirmed by the Senate. The
Special Inspector General's nomination would be made as soon as
practicable after the establishment of the Exchange.
The duties of the Special Inspector General would consist
of the following:
Conduct, supervise, and coordinate audits,
evaluations and investigations of the Health Insurance
Exchange to protect the integrity of the Exchange as
well as the health and welfare of participants in the
Exchange;
Report both to the Commissioner and to the
Congress regarding program and management problems and
recommendations to correct them;
Related to the duties above, have other
duties described as applying to the Special Inspector
General of the Troubled Asset Relief Program (TARP),
per paragraphs (2) and (3) of Section 121 of P.L. 110-
343; and
In carrying out these duties, have the
authorities of inspectors general in Section 6 of the
Inspector General Act of 1978.
Other provisions of the TARP Special Inspector General
would also be applied, regarding the basis of the Special
Inspector General's appointment, how s/he might be removed,
his/her salary, and available personnel, facilities and other
resources.
Not later than one year after the confirmation of the
Special Inspector General, and annually thereafter, the Special
Inspector General would submit to the appropriate committees of
Congress a report summarizing the activities of the Special
Inspector General during the one year period ending on the date
the report is submitted.
The Office of the Special Inspector General would terminate
five years after the date of the enactment of this Act.
Sec. 207. Health Insurance Exchange Trust Fund
A ``Health Insurance Exchange Trust Fund'' would be created
within the U.S. Treasury, consisting of such amounts as may be
appropriated or credited to the fund. The Commissioner would
pay from the Trust Fund amounts as determined necessary to make
payments to operate the Exchange, including affordability
credits.
Dedicated payments to the Trust Fund would include the
following:
taxes on individuals not obtaining
acceptable coverage (Section 401);
taxes on employers electing to not provide
health benefits (Section 412); and
excise tax on employers who fail to satisfy
health coverage participation requirements (Section
411).
Such additional sums as necessary would be appropriated.
General provisions in the Internal Revenue Code regarding
federal government trust funds would apply.
Sec. 208. Optional operation of State-based health insurance exchanges
If a state (or group of states, subject to the
Commissioner's approval) applied to the Commissioner for
approval of a state-based Health Insurance Exchange, and if the
Commissioner approves such state-based Exchange, then the
state-based Exchange would operate instead of the federal
Exchange in that state(s).
The Commissioner could not approve a state-based Exchange
unless the following requirements were met (and would be
required to approve it if the conditions were met):
The state-based Exchange must demonstrate the
capacity to and provide assurances satisfactory to the
Commissioner that it could carry out the functions specified
for the federal Exchange in the state(s) including:
negotiating and contracting with qualified
plans;
enrolling Exchange-eligible individuals and
employers in plans;
establishing sufficient local offices to
meet the needs of Exchange-eligible individuals and
employers;
administering premium and cost-sharing
credits (described below in Sections 241-246) using the
same methodologies, and at least the same income
verification methods, as would otherwise apply and at a
cost to the federal government that is not greater than
what would otherwise apply; and
enforcement activities consistent with
federal requirements.
There is no more than one Exchange in operation in
any one state.
The state provides assurances satisfactory to the
Commissioner that approval of such an Exchange would not result
in any net increase in expenditures to the federal government.
The state provides for reporting of such
information as the Commissioner determines and assurances
satisfactory to the Commissioner that it will vigorously
enforce violations of applicable requirements.
Such other requirements as the Commissioner may
specify.
If a state was operating an ``Exchange'' prior to January
1, 2010, and sought to operate a state-based Exchange under
this section, the Commissioner would presume the Exchange meets
the required standards. The Commissioner would be required to
establish a process to work with such a state, but could
determine, after working with the state, that the state does
not comply with such standards.
A state-based Exchange could, at the option of the state,
and only after providing timely and reasonable notice to the
Commissioner, cease operation. In this case, the federal
Exchange would be operational in the state(s).
The Commissioner could terminate the approval (for some or
all functions) of a state-based Exchange if the Commissioner
determined that it no longer met the requirements listed above
or was no longer capable of carrying out such functions. In
lieu of terminating the state-based Exchange's approval, the
Commissioner could temporarily assume some or all functions of
the state-based Exchange until the Commissioner determined that
it met the applicable requirements and was capable of carrying
out those functions. The ceasing or termination of a state-
based Exchange would be effective in such time and manner as
the Commissioner would specify.
Enforcement authorities of the Commissioner would be
retained by the Commissioner. The Commissioner could specify
functions of the federal Exchange that may not be performed by
a state-based Exchange or that could be performed by both the
Commissioner and the state-based Exchange.
In the case of a state-based Exchange, except as the
Commissioner may otherwise specify, any references to the
``Exchange'' or to the ``Commissioner'' in the area in which
the state-based Exchange operates would be deemed a reference
to the state-based Exchange and the head of that Exchange.
In the case of a state-based Exchange, funding assistance
would be provided for its operation in the form of a matching
grant, with a state share of expenditures required.
This provision would also enable a state to receive an
incentive payment if it enacts and implements an alternative
medical liability law that complies with the bill. The
Secretary would determine that a state law is compliant if she
is satisfied that the State has enacted and is currently
implementing the law, and finds the law to be ``effective.'' To
determine the effectiveness of a law, the Secretary would
consider whether it makes the medical liability system more
reliable through the prevention of or prompt and fair
resolution of disputes, it encourages the disclosure of health
care errors, and it maintains access to affordable liability
insurance. The state law would be required to provide for an
``early offer'' system, a ``certificate of merit'' program, or
a combination of both. In general, an early offer system
permits a defendant to offer to a claimant within 180 days
after a claim is filed, periodic payment of the claimant's
economic losses. If an early offer is not made, the injured
party can proceed with a normal tort claim for both economic
and noneconomic damages. However, if an early offer is made and
the claimant declines the offer, both the standard of
misconduct and standard of proof are raised. A certificate of
merit program requires claimants, when a medical malpractice
suit is first filed, to include testimony from a qualified
medical expert that establishes that there is merit to the
claim. A state that receives an incentive payment would have to
use it to improve health care in the state. The Secretary may
provide technical assistance to those states that apply for or
are awarded an incentive payment. Not later than one year after
the date of enactment, the Secretary shall submit to Congress
an annual report on the progress states have made in adopting
and implementing alternative medical liability laws that comply
with this provision.
Sec. 209. Limitation on premium increases under Exchange-participating
health benefits plans
This provision would limit Exchange plans' premium
increases to 150% of annual medical inflation, unless the plan
receives one of two exceptions (none of which would preempt
existing State prior-approval laws): (1) the plan must offer
additional benefits required by the Commissioner, or (2) the
plan demonstrates to the Commissioner (or, if determined
appropriate by the Commissioner, the State insurance
commissioner) that the premium limitation would threaten its
financial viability or its ability to provide timely benefits
to plan participants.
Subtitle B--Public Health Insurance Option
Sec. 221. Establishment and administration of a public health insurance
option as an Exchange-qualified health benefits plan
Current Law
There is no federal public option available for the non-
disabled population under age 65. Medicare is an example of a
federal public health insurance program for the aged and
disabled. Under Medicare, Congress and the Department of Health
and Human Services (HHS), Centers for Medicare and Medicaid
Services (CMS) determine many parameters of the program
including eligibility rules, financing (including determination
of payroll taxes, and premiums), required benefits, payments to
health care providers, and cost-sharing amounts. However, even
within this public plan, CMS subcontracts with private
companies to carry out much of the administration of the
program.
Proposed Law
The provision would require the Secretary of Health and
Human Services (Secretary) to provide for the offering of a
public health insurance option through the Exchange starting
Y1. The Secretary would be required to ensure that the public
option provided choice, competition, and stability of
affordable, high-quality coverage throughout the United States.
The Secretary's primary responsibility would be to create a
low-cost plan without compromising quality or access to care.
The public option would only be available through the
Health Insurance Exchange. The public option would be required
to comply with requirements applicable to Exchange-
participating health benefit plans, including requirements
related to benefits, benefit levels, provider networks,
notices, consumer protections, and cost sharing. The public
option would be required to offer Basic, Enhanced, and Premium
plans, and would be allowed to offer Premium-Plus plans.
The Secretary would be allowed to enter into contracts for
the administration of the public option in the same manner as
the Secretary is allowed to enter into contracts for the
administration of the Medicare program. These administrative
functions include, subject to restrictions, determination of
payment amounts, making payments, beneficiary education and
assistance, provider consultative services, communication with
providers, and provider education and technical assistance.
This includes contracting with appropriate non-profit entities,
including Medicare's Quality Improvement Organizations, quality
improvement entities created under Section 2401 of this Act, or
other appropriate organizations, to assist providers to improve
their performance. The provision would prohibit contracts that
involve the transfer of insurance risk.
The Secretary would be required to establish an office of
the ombudsman for the public health insurance option which
would have duties similar to those of the Medicare Beneficiary
Ombudsman.
The Secretary would be required to collect data necessary
to establish premiums and payment rates and for other purposes,
including improving quality and reducing racial, ethnic, and
other disparities in health and health care.
With respect to the public health insurance option, the
Secretary would be treated as an entity offering a Quality
Health Benefit Plan through the Exchange.
The provisions relating to access to federal courts for
enforcement of rights under Medicare would apply to the public
option and individuals enrolled under the public option in the
same manner that they apply to Medicare and Medicare
beneficiaries.
Sec. 222. Premiums and financing
The Secretary would be required to establish
geographically-adjusted premiums for the public option in a
manner that complies with the premium rules established by the
Commissioner for Exchange-participating health benefit plans
and at a level sufficient to fully finance the cost of health
benefits and administration for the public option. Premiums
would be required to include an appropriate amount for a
contingency margin of not less than 90 days of estimated
claims. Starting in 2015, the Secretary would be required to
solicit recommendations from the American Academy of Actuaries
prior to setting the amount of the contingency margin.
The provision would establish an account in the Treasury
for receipts and disbursements attributable to the public
option, including start-up funding. The start-up funding would
be equal to the sum of $2 billion for the establishment of the
public option, and such sums as may be necessary to cover 90
days worth of reserves based on projected enrollment. These
amounts would be authorized to be appropriated to the Secretary
out of any funds in the Treasury not otherwise appropriated.
The Secretary would be required to provide for repayment of the
start-up funding in an amortized manner over a 10-year period
starting in Y1. The provision specifies that nothing in this
section could be construed as authorizing any additional
appropriations to the account, other than amounts otherwise
provided with respect to other Exchange-participating plans. As
under the Medicare Advantage program, states could not impose a
premium tax or similar tax with respect to the public option.
In no case shall the public health insurance option receive any
Federal funds for purposes of insolvency in any manner similar
to the manner in which entities receive Federal funding under
the Troubled Assets Relief Program.
Sec. 223. Payment rates for items and services
The Secretary would be required to establish payment rates
for services and health care providers under the public option
consistent with the modernized payment initiatives and payment
reforms specified in Section 224.
The Secretary would be required to negotiate rates in a
manner that resulted in payment rates not lower, in aggregate,
than rates under Medicare and not higher, in aggregate, than
the average rates paid by other qualified health benefits plan
offering entities for services and health care providers. The
provision specifies that nothing would prevent the use of
innovative payment methodologies such as those described in
Section 224 in connection with the negotiation of payment
rates. As introduced and reported, H.R. 3200 would allow the
Secretary discretion to establish a prescription drug
formulary, and use other methods, including those used by
private sector pharmacy benefit managers, to reduce
prescription drug costs under the public health insurance
option, and the Committee expects that the Secretary would
implement such a formulary. Section 223(a)(4), as added by the
Committee, would require that the Secretary establish a
particular formulary for prescription drugs under the public
health insurance option. Health care providers participating in
Medicare would be participating providers in the public health
insurance option unless they opted out in a process established
by the Secretary. Not later than 18 months before the first day
of 2013, the Secretary would be required to promulgate rules
for the opt out process. Under the opt out process, (a)
providers would be provided at least a 1-year period prior to
the first day of 2013 to opt out, (b) no provider would be
penalized for opting out, (c) the Secretary would be required
to include information on how providers participating in
Medicare who choose to opt out of participating in the public
option may opt back in, and (d) there would be an annual
enrollment period in which providers may decide whether to
participate in the public option.
The provision would prohibit administrative or judicial
review of a payment or methodology established under this
section, or Section 244 on modernized payment initiatives and
delivery system reform.
Sec. 224. Modernized payment initiatives and delivery system reform
Beginning in the first year of the public option, the
Secretary would be given the authority to use innovative
payment mechanisms and policies to determine payments for items
and services under the public option. The payment mechanisms
and policies may include the following: patient-centered
medical home, other care management payments, accountable care
organizations, value-based purchasing, bundling of services,
differential payment rates, performance or utilization based
payments, partial capitation, and direct contracting with
providers. The Secretary would be required to design and
implement the payment mechanisms and policies in a way that
promotes care that is integrated, patient-centered, efficient
and of quality, and that seeks to either (a) improve health
outcomes, (b) reduce health disparities, (c) address geographic
variation in the provision of health services, (d) prevent or
manage chronic illness, or (e) provide efficient and affordable
care. To the extent allowed under the rules for Exchange-
participating plans, the provision would allow cost-sharing and
payment rates under the public option to be modified to
encourage the use of services that promote health and value.
The Secretary shall monitor and evaluate the progress and
payment of delivery system reforms under this section and shall
seek to implement such reforms on as large a geographic scale
as practical and economical in so much that the Secretary finds
such reforms are successful in improving quality and reducing
costs. The Secretary may delay the implementation of such
reforms in a geographic area in which such implementation would
place the public health insurance option at a competitive
disadvantage. The Secretary may also prioritize such a reform
in a high cost geographic area in order to reduce total program
costs or to promote high value care. The provision specifies
that nothing in the subtitle would prevent the Secretary from
varying payments based on different payment structure models
for different geographic areas.
Sec. 225. Provider participation
Current Law
No provision.
Proposed Law
The Secretary would be required to establish conditions of
participation for health care providers under the public
option. The Secretary would be prohibited from allowing a
health care provider to participate unless appropriately
licensed or certified under state law. A health care provider
that was excluded from participation in a federal health care
program (as defined in Section 1128(f) of the Social Security
Act), would be prohibited from participating under the public
option.
Sec. 226. Application of fraud and abuse provisions
Current Law
Title XVIII of the SSA, the Medicare statutes, requires
activities that prevent, detect, investigate, and prosecute
health care fraud and abuse. In general, initiatives designed
to fight fraud, waste, and abuse are considered program
integrity activities. Program integrity is considered a
component of the effective and efficient administration of
government programs, which are entrusted with ensuring that
taxpayer dollars are spent wisely. Efforts to ensure Medicare
program integrity encompass a wide range of activities and
require coordination among multiple private and public
entities. This includes processes directed at reducing payment
errors to Medicare providers, as well as activities to prevent,
detect, investigate, and ultimately prosecute health care fraud
and abuse.
Proposed Law
The provisions of law (other than criminal law) identified
by the Secretary by regulation, in consultation with the
Inspector General, that impose sanctions with respect to waste,
fraud, and abuse under Medicare would also apply to the public
health insurance option. The Secretary shall not be given
discretion as to whether criminal laws apply, but rather
criminal laws apply regardless of the Secretary.
Sec. 227. Application of HIPAA insurance requirements
Current Law
HIPAA established federal rules regarding insurance in the
individual and group markets. These include rules on non-
discrimination based on health status-related factors, pre-
existing condition exclusions, provisions on renewal and
termination of coverage, the Genetic Information
Nondiscrimination Act of 2008, the Mental Health Parity Act of
1996, as amended and other requirements.
Proposed Law
The requirements of the Public Health Service Act sections
2701 to 2792 apply to the public health insurance option in the
same manner they apply to health insurance coverage offered by
a health issuer in the individual market.
Sec. 228. Application of health information privacy, security, and
electronic transaction requirements
Current Law
HIPAA established federal privacy and security rules in
1996. In addition, it established rules for standardized
electronic transactions such as eligibility and claims payment.
Proposed Law
Part C of title XI of the Social Security Act applies to
the public health insurance option in the same manner it
applies to health insurance coverage offered by a health issuer
in the individual market.
Sec. 229. Enrollment in public health insurance option is voluntary
The provision would clarify that enrollment in the public
health insurance option is voluntary and nothing in the
division would require anyone to enroll in it.
Subtitle C--Individual Affordability Credits
Sec. 241. Availability through Health Insurance Exchange
Current Law
No provision.
Proposed Law
This provision would provide premium and cost-sharing
credits to ``affordable credit eligible individuals'' (defined
in Section 242) for certain individuals enrolled in coverage
through the Exchange. The Commissioner would pay each QHBP
participating in the Exchange the aggregate amount of credits
for all eligible individuals enrolled in that plan.
An Exchange-eligible individual could apply to the
Commissioner, through the Exchange or another entity under an
arrangement made with the Commissioner, in a form and manner
specified by the Commissioner. The Commissioner, through the
Health Insurance Exchange or through another public entity
under an arrangement made with the Commissioner, would make a
determination as to eligibility of an individual for
affordability credits. The Commissioner would establish a
process whereby, on the basis of information otherwise
available, individuals may be deemed eligible for credits. The
Commissioner would also establish effective methods that ensure
that individuals with limited English proficiency are able to
apply for affordability credits.
If the Commissioner determines that a state Medicaid agency
has the capacity to make a determination of eligibility for
affordability credits under the same standards as used by the
Commissioner under the Medicaid memorandum of understanding
(described above in Section 205), the state Medicaid agency is
authorized to conduct such determinations for any Exchange-
eligible individual who requests such a determination, and the
Commissioner would reimburse the state Medicaid agency for the
costs of conducting such determinations.
In addition, there would be a Medicaid screen-and-enroll
obligation, that when individuals apply for affordability
credits, a determination would be made as to whether they are
eligible for Medicaid. If they are determined eligible for
Medicaid, the Commissioner, through the Medicaid memorandum of
understanding, would provide for their enrollment under the
state Medicaid plan, and the state would provide for the same
periodic redetermination of eligibility under Medicaid as would
otherwise apply.
During the first two years of implementation, credits would
be allowed for coverage under a Basic plan only. Beginning in
the third year, credits would be allowed for coverage under
Enhanced or Premium plans by a process established by the
Commissioner. The individual would be responsible for any
difference between the premium for an Enhanced or Premium plan
and the credit amount based on a Basic plan applicable to that
enrollee.
Under subsection (c)(3) an affordability credit is
specifically prohibited from being used for payment for
abortion services. This provision is discussed in detail below
in the section titled ``Abortion-Related Language in Division
A.''
The Commissioner would be authorized to request from the
Treasury Secretary information that may be required to carry
out this subtitle (regarding individual affordability credits),
consistent with existing rules regarding confidentiality and
disclosure of tax return information. Individuals who are
eligible to receive credits would not receive them in the form
of cash payments.
Sec. 242. Affordable credit eligible individual
This provision would define an ``affordable credit eligible
individual'' as an individual who (1) is lawfully present in a
state in the United States (other than a nonimmigrant, with
some exceptions), (2) is enrolled in an Exchange plan and is
not enrolled through an employer plan that meets the employer
responsibility to contribute toward employee and dependent
coverage (described below in Section 312), (3) has family
income below 400% FPL, and (4) who is not a Medicaid-eligible
individual (other than some exceptions described above in
Section 202). Family members who are eligible for credits will
be treated as a single affordable credit eligible individual.
Credits would not be available to full-time employees of an
employer offering coverage consistent with the employer
contribution rules described in Section 312. The Commissioner
would make exceptions to this rule for divorced or separated
individuals, or dependents of employees who would otherwise be
eligible for credits. Exceptions would also be made, beginning
in Y2, for full-time employees whose premium costs under a
group health plan exceed 12% of family income.
Income would be defined as ``modified adjusted gross
income'' (MAGI), per the new section 59B of the Internal
Revenue Code, added in Section 401. The Commissioner would
conduct a study to examine the application of income disregards
for the purposes of the affordability credits. The Commissioner
would submit a report to Congress of such a study, including
recommendations as the Commissioner determines appropriate.
Affordability credits would not be treated as a federal means-
tested public benefit for eligibility purposes for qualified
aliens under the Personal Responsibility and Work Opportunity
Reconciliation Act of 1996.
In the introduced bill, employers with payrolls under
$250,000 were exempt from the employer responsibility
requirements, and those with payrolls between $250,000 and
$400,000 had phased in responsibility requirements. The
Committee adopted an amendment that reflects the Committee's
view that this employer responsibility exemption should apply
to employers with payrolls under $500,000 instead of $250,000,
with phased-in responsibility for those with payrolls between
$500,000 and $750,000 instead of $250,000 and $400,000.
Sec. 243. Affordable premium credit
This section would establish the rules for determining the
amount of the premium credit provided to eligible individuals
enrolled in an Exchange plan. The ``affordability premium
credit'' would be an amount equal to the lesser of (1) the
amount by which the enrollee's premium exceeds a specified
level that is considered affordable (``affordable premium
amount''), or (2) the amount by which the ``reference premium''
(the average premium of the three least expensive Basic plans
in the individual's premium rating area) exceeds the
``affordable premium amount''. In calculating the reference
premium, the Commissioner may exclude plans with extremely
limited enrollments.
The affordable premium credit amount would be calculated on
a monthly basis, based on the following table, to limit
individuals' premium payments to a percentage of family income
(MAGI) relative to the poverty level, as specified in the table
below.
------------------------------------------------------------------------
Premium payment
limit, as a
Federal poverty level (FPL) percent of
income
------------------------------------------------------------------------
133% or less.......................................... 1.5
150%.................................................. 3
200%.................................................. 5.5
250%.................................................. 8
300%.................................................. 10
350%.................................................. 11
400%.................................................. 12
------------------------------------------------------------------------
The Commissioner would establish premium percentage limits
so that for individuals whose family income is between the
income tiers specified in the table, the percentage limits
would increase on a linear sliding scale. Beginning in 2014,
the Commissioner would adjust the percentages in the table so
that the percentage of premiums paid by the government versus
enrollees in each income tier remains the same as in 2013.
Every year, beginning before January 1, 2014, the Chief
Actuary of the Centers for Medicare and Medicaid Services (CMS)
would estimate the cost savings in the previous year from the
provisions listed below and would report the estimate to the
Commissioner, who would provide for an appropriate increase in
the table above so that those cost savings could be reflected
in increased affordability credits:
formulary provisions under the public option
(Section 223(a)(4));
pharmacy benefit managers (PBM) transparency
(Section 133(d));
accountable care organizations in Medicaid
(Section 1730);
administration simplifications (Sections
163-164);
limitations on Exchange plan premium
increases (Section 209); and
the authority of the Secretary to negotiate
lower Part D prescription drug prices (Section 1186).
Sec. 244. Affordability cost-sharing credit
The affordability cost-sharing credit under this section
would be available to those enrolled in an Exchange plan whose
income is less than 400% FPL. The Commissioner would specify
reductions in cost-sharing amounts and the annual limitation
(out-of-pocket maximum) on cost-sharing under a Basic plan so
that the average percentage of covered benefits paid by the
plan (as estimated by the Commissioner) is equal to the
percentages (actuarial values) in the table for each income
tier.
------------------------------------------------------------------------
Actuarial value
Federal poverty level (FPL) percentage
------------------------------------------------------------------------
150% or less........................................ 97
200%................................................ 93
250%................................................ 85
300%................................................ 78
350%................................................ 72
400%................................................ 70
------------------------------------------------------------------------
The Commissioner would provide payments to QHBP-offering
entities in an amount equivalent to the increased actuarial
value of benefits resulting from the cost-sharing reductions.
Sec. 245. Income determinations
This provision would use an individual's adjusted gross
income in the most recent taxable year for determination of a
credit under this subtitle. The Commissioner would take steps
as may be appropriate to ensure the accuracy of determinations
and redeterminations under this subtitle. The Commissioner
would request information from the Treasury Secretary as may be
permitted to verify income information submitted in
applications for credits. The Commissioner would establish
procedures for verification of income if no tax return is
available for the most recent completed tax year. The
Commissioner would establish special rules for cases when an
individual's income is expected (in a manner specified by the
Commissioner) to be significantly different from the income
submitted for application for and determination of a credit.
The Commissioner would establish rules under which an
individual would be required to inform the Commissioner when
there is a significant change in income. Such mechanism would
provide for guidelines that specify the circumstances that
qualify as a significant change, the verifiable information
required to document such a change, and the process for
submission of such information. If the Commissioner receives
new information from an individual regarding the family income
of the individual, the Commissioner would provide for a
redetermination of the individual's eligibility to be an
affordable credit eligible individual.
An individual who intentionally misrepresents family income
or fails to disclose to the Commissioner a significant change
in family income would be liable for repayment of any
improperly received credit and, in the case of intentional
misrepresentation, may be required to pay an additional penalty
as imposed by the Commissioner.
For a CHIP-eligible child deemed to be eligible for
coverage through the Exchange, during the first year of
implementation the Commissioner would establish rules under
which family income of the child is deemed to be no greater
than the family income of that child as most recently
determined by the State under CHIP. The Commissioner would
examine the feasibility and implication of adjusting the
application of the federal poverty level in this subtitle to
take into account geographic differences, in order to reflect
cost-of-living variations across the country. The Commissioner
would ensure that the study covers the territories (Puerto
Rico, U.S. Virgin Islands, Guam, Northern Mariana Islands and
any other territory or possession of the United States), paying
special attention to the disparity that exists among poverty
levels and the cost of living in the territories and the impact
of such disparities on efforts to expand health coverage and
ensure health care. The Commissioner would submit a report to
Congress, no later than the first day of the second year of
implementation, on such a study and make recommendations as
appropriate.
Sec. 246. No Federal payment for undocumented aliens
No credits are permitted for individuals who are not
lawfully present in the country. The Commissioner will have to
establish a process to enforce this federal requirement and
ensure no undocumented persons receive affordability credits.
Subtitle D--Health Insurance Cooperatives
Sec. 251. Establishment
Sec. 252. Start-up and solvency grants and loans
Sec. 253. Definitions
Current Law
Some states have laws and regulations applicable to a
specific type of multiple employer welfare arrangement (MEWA),
a health insurance cooperative, a non-profit arrangement which
allows small businesses to join as members and obtain health
benefits offered through the cooperative. While ERISA gives the
Department of Labor some authority to regulate MEWAs, States
are the primary regulators.
Proposed Law
This provision would require the Commissioner, in
consultation with the Treasury Secretary, to establish a
program to provide grants and loans for the establishment and
initial operation of health insurance cooperatives. The program
would be established within six months after enactment. Such
cooperatives would provide insurance through the Exchange
(established under Section 201) or state-based exchange
(established under Sec 208), but would not substitute for the
public health insurance option. A state is not required to
establish a health cooperative.
Within 36 months after enactment, the Commissioner may make
(1) loans to cooperatives to assist them with start-up costs,
and (2) grants to cooperatives to assist them in meeting
applicable state solvency requirements. The cooperative would
need to meet specified criteria in order to be awarded such a
grant or loan. Such criteria include the requirements that the
cooperative be run as a non-profit, member-run organization,
not be sponsored by the state, be licensed in the state which
it offers insurance, and other requirements. This provision
would allow cooperatives in different states to integrate their
administrative, insurance, and other functions. Cooperatives
that violate the terms of the grant and loan program and fails
to make corrections would be required to repay the total amount
received. This provision would authorize a total of $5 billion
in appropriations for the period of FY2010 to FY2014 for grants
and loans under this section.
With respect to cooperatives, the definition of a ``state''
would refer to the 50 states and the District of Columbia. And
the definition of a ``member'' would refer to an individual
who, after the cooperative offers health insurance, is enrolled
in such coverage.
TITLE III--SHARED RESPONSIBILITY
Subtitle--Individual Responsibility
Sec. 301. Individual responsibility
Current Law
No provision.
Proposed Law
The provision cross-references the shared responsibility
provisions of section 59B of the Code (as added by section 401
of the bill) which provides for a tax on individuals (or a
husband and wife in the case of a joint return) who do not
maintain coverage under acceptable health insurance for
themselves and each of their qualifying children. The provision
is effective for taxable years beginning after December 31,
2012.
Subtitle B--Health Coverage Participation Requirements
Part 1--Health Coverage Participation Requirements
Sec. 311. Health coverage participation requirements
Current Law
Currently, it is optional whether employers contribute to
the costs of health insurance for their employees' health
insurance. For employers who choose to offer coverage to their
employees, the cost to an employer of providing health coverage
for its employees, including the cost of employer contributions
towards health coverage premiums, is generally deductible as an
ordinary and necessary business expense for employee
compensation. In addition, compensation in the form of
employer-provided health insurance is not subject to payroll
taxes.
The Employee Retirement Income Security Act of 1974
(``ERISA'') preempts state law relating to certain employee
benefit plans, including employer-sponsored health plans. While
ERISA specifically provides that its preemption rule does not
exempt or relieve any person from any state law which regulates
insurance, ERISA also provides that an employee benefit plan is
not deemed to be engaged in the business of insurance for
purposes of any state law regulating insurance companies or
insurance contracts. As a result of this ERISA preemption,
self-insured employer-sponsored health plans need not provide
benefits that are mandated under state insurance law.
While ERISA does not require an employer to offer health
benefits, it does require compliance with certain rules if an
employer chooses to offer health benefits, such as compliance
with plan fiduciary standards, reporting and disclosure
requirements, and procedures for appealing denied benefit
claims. ERISA was amended (as well as the Public Health Service
Act\1\ and the Internal Revenue Code) in the Consolidated
Omnibus Budget Reconciliation Act of 1985 (``COBRA'') and the
Health Insurance Portability and Accountability Act of 1996
(``HIPAA''), adding other federal requirements for health
plans, including rules for health care continuation coverage,
limitations on exclusions from coverage based on preexisting
conditions, and a few benefit requirements such as minimum
hospital stay requirements for mothers following the birth of a
child.
---------------------------------------------------------------------------
\1\42 U.S.C. 6A.
---------------------------------------------------------------------------
Under Medicaid, states may establish ``premium assistance''
programs, which pay a Medicaid beneficiary's share of premiums
for employer-sponsored health coverage. Besides being available
to the beneficiary through his or her employer, the coverage
must be comprehensive and cost-effective for the State. A 2007
U.S. Department of Health and Human Services, Center for
Medicare and Medicaid Services analysis titled ``The State
Children's Health Insurance Program'' showed that 12 states had
Medicaid premium assistance programs as authorized under
current law.
Proposed Law
An employer has a responsibility requirement. To fulfill
the requirement, employers offering health benefit plans are
required to offer individual and family coverage under a
qualified health benefits plan (or under certain grandfathered
plans). They are required to make contributions to help
discharge the coverage costs of employees enrolled in the
employer-provided plan.
Beginning in the second year after the general effective
date of the market reforms of the bill, employers are required
to make contributions to the Health Insurance Exchange (the
``Exchange'') for employees who decline employer-provided
coverage and instead enroll in an Exchange-participating plan
pursuant to an affordability waiver. However, contributions are
not required if the employee declines coverage because the
employee is enrolled in family coverage in the Exchange as a
spouse or dependent of another insured. The provision is
effective for periods beginning after December 31, 2012.
Sec. 312. Employer responsibility to contribute towards employee and
dependant coverage
Employers that offer health benefit plans are required to
offer individual and family coverage under a qualified health
benefit plan (or certain grandfathered health insurance plans).
For a plan to be a ``qualified health benefits plan'' it needs
to meet certain minimum coverage requirements, minimum benefit
requirements, and has specific requirements such as a
prohibition on annual and lifetime limits, but it need not be
offered through the Exchange. They are required to make
contributions to help discharge the coverage costs of employees
(and their spouses and qualifying children, if any) enrolled in
the employer-provided plan.
For full time employees, the contribution amount is
required to be at least 72.5% of the lowest cost plan offered
by the employer which meets the requirements of the essential
benefits package. This employer contribution amount is 65% for
eligible employees electing family coverage. The essential
benefits bans annual or life time limits on covered health care
items or services and certain specified minimum services, it
has a set out of pocket maximum, it imposes certain
requirements as to network adequacy as determined by the Health
Choices Commissioner, and other protections.
For part-time employees, the contribution amount is a
fraction or prorated amount of the minimum contributions made
for full time employees, with such fraction being equal to a
ratio of the average weekly hours worked by the employee
compared to the minimum weekly hours specified by the Health
Choices Commissioner. The coverage offered to non full time
employees can be a less generous coverage package but the
coverage package must meet the essential benefits requirements
at a minimum.
An employer cannot satisfy the minimum contribution
requirement through a salary reduction arrangement with the
employee.
An employer that elects to offer health benefit plans must
provide each employee with a 30-day opt-out period after the
employee becomes eligible for employer-provided coverage in
which to either decline coverage entirely or affirmatively
enroll in a health plan. At the end of the 30-day period, if
the employee does not make an affirmative election with respect
to health coverage, the employer must automatically enroll the
employee for individual (not family) coverage in the employer-
sponsored health benefit plan with the lowest applicable
employee premium.
Employers are required, within a reasonable period before
the beginning of each plan year, to provide employees with
written notice of employees' rights and obligations relating to
automatic enrollment. The notice must be both comprehensive in
scope (for example, it must explain opt-out and affirmative
election rights) and easily understood by the average employee
to whom it pertains. Specifically, the notice must explain an
employee's right to make an affirmative election as to health
coverage rather than being automatically enrolled; and, if more
than one level of benefits or employee premium is offered by
the employer, the notice must explain in which level of
benefits and employee premium the employee will be
automatically enrolled absent an affirmative election.
Employers that offer health benefit plans are required to
provide the Health Choices Commissioner, and the Secretaries of
Labor, Health and Human Services, and the Treasury with
information required by the Health Choices Commissioner to
ascertain compliance with the provision's requirements.
The provision is effective for periods beginning after
December 31, 2012.
Sec. 313. Employer contributions in lieu of coverage
Beginning in 2014, employers are required to make
contributions to the Health Insurance Exchange for employees
who decline employer-provided coverage and instead enroll in an
Exchange-participating plan. The contribution amount is equal
to 8% of the average wages paid by the employer to its employee
during the time the employee was enrolled in the non-employer-
provided plan. However, contributions are not required if the
employee declines coverage because the employee is enrolled in
family coverage as a spouse or dependent of another insured.
Additionally, such contributions are not required if an
employee declines coverage for any reason and does not enroll
in the exchange, including receiving coverage through Medicare,
Medicaid, as a spouse or dependent of another's plan, or
chooses to not be covered.
Employers with annual payrolls not exceeding $250,000
during the preceding calendar year are not subject to the tax.
Employers with annual payrolls between $250,000 and $400,000
during the preceding calendar year are subject to a reduced
rate. Employer contributions are paid to the Health Choices
Commissioner and deposited into the Health Insurance Exchange
Trust Fund. The contributions are not tied to a particular
employee (i.e., the contribution does not subsidize an
employee's premium liability). This contribution requirement
parallels the payroll tax equal to 8% of wages that applies to
non-electing employers. The provision is effective for periods
beginning after December 31, 2012.
Sec. 314. Authority related to improper steering
The Health Choices Commissioner (in coordination with the
Secretaries of Labor, Health and Human Services, and the
Treasury) has the authority to set standards for determining
whether employers, in the course of offering coverage, are
undertaking any actions to affect the risk pool within the
Health Insurance Exchange by inducing sicker or older employees
to enroll in Exchange-participating health plans rather than in
employer-provided plans. An employer found to be violating
these standards is treated as not meeting the provision's
coverage requirements. The provision is effective for periods
beginning after December 31, 2012.
Part 2--Satisfaction of Health Coverage Participation Requirements
Sec. 323. Satisfaction of health coverage participation requirements
under the Public Health Service Act
Under the provision, employers are required to make an
affirmative election regarding whether to offer health benefit
plans to employees. Employers electing to offer health benefit
plans are required to have their plans meet certain minimum
coverage requirements. Employers electing to offer health
benefit plans are treated as having established and maintained
a group health plan for purposes of ERISA, and the provision's
health coverage participation requirements are deemed to be
part of the terms and conditions of the employer-provided plan.
The Secretary of Health and Human Services is required to
conduct periodic audits of a representative sampling of
employers and employer-provided group health plans in order to
discover noncompliance. The Secretary of Health and Human
Services must share findings of noncompliance with the
Secretary of the Treasury and the Health Choices Commissioner,
and must take timely enforcement action as appropriate to
achieve compliance.
Separate elections may be made with regard to full time
employees and those who are not full time employees. Coverage
offered each need not be equivalent, but both must be offered
coverage that meets the essential benefits package at a
minimum.
The Secretary of Health and Human Services (in coordination
with the Health Choices Commissioner) may terminate an
employer's election (and thus subject the employer to the
payroll tax imposed on employers that do not offer coverage) if
the Secretary determines that the employer was substantially
noncompliant with the health coverage participation
requirements. The Secretary is permitted to promulgate
regulations to carry out the provisions of these coverage
requirements, and may issue interim final rules as appropriate.
Employers who elect to provide coverage but whose health
benefit plans fail to meet the provision's minimum health
coverage participation requirements are subject to penalties of
$100 per day for each employee to whom the failure applies. The
provision permits the penalties to be assessed through an
excise tax or a civil penalty under the Public Health Service
Act. Penalties for any particular failure may not be
duplicated, however. The Secretary of Health and Human Services
is required to give advance written notification of failure to
employers prior to the assessment of a penalty.
The penalties do not apply to (1) periods during which an
employer used reasonable diligence but did not discover any
failures, and (2) failures that were corrected within 30 days
of discovery (but only if such failures were due to reasonable
cause and not willful neglect). Penalties imposed on employers
for unintentional failures (i.e., due to reasonable cause and
not willful neglect) are to be limited to the lesser of 10
percent of the aggregate amount paid or incurred by the
employer during the preceding taxable year for group health
plans, or $500,000.
The provision is effective for periods beginning after
December 31, 2012.
Sec. 324. Additional rules relating to health coverage participation
requirements
The Health Choices Commissioner and the Secretaries of
Labor, Health and Human Services, and the Treasury are required
to execute an interagency memorandum of understanding to ensure
coordination with respect to regulations, rulings,
interpretations, and enforcement of the employer responsibility
requirements relating to the offering of health insurance set
forth in the Code and the parallel provisions in ERISA and the
Public Health Service Act. The interagency memorandum must
provide that in the case of multiemployer group health plans
the health coverage participation requirements apply to the
plan sponsor and the contributing sponsors of the plan. A
multiemployer plan is a collectively bargained plan maintained
by more than one employer, usually within the same or related
industries, and a labor union. ERISA section 3(37). The
provision is effective for periods beginning after December 31,
2012.
Abortion-Related Language in Division A
Current Law
Abortion is widely covered by private insurance. One study
concluded that, of surveyed insurance plans, 87% covered
abortion services.\2\ Another study found that, of surveyed
insurance plans, 46% covered abortion services.\3\ A comparison
of the two studies examined the different methodologies used by
each (e.g., who was surveyed, definition of plans), and
concluded that, ``The actual answer is probably somewhere in
between, meaning that most Americans with employer-based
insurance currently have coverage for abortion.''\4\
---------------------------------------------------------------------------
\2\Sonfield, et al., ``U.S. Insurance Coverage of Contraceptives
and the Impact Of Contraceptive Coverage Mandates,'' Perspectives on
Sexual and Reproductive Health (2002) (available at http://
www.guttmacher.org/pubs/psrh/full/3607204.pdf).
\3\Claxton, et al., ``Employer Health Benefits: 2003,'' Kaiser
Family Foundation (2003) (available at http://www.kff.org/insurance/
upload/Kaiser-Family-Foundation-2003-Employer-Health-Benefits-Survey-
Full-Report.pdf).
\4\``Guttmacher Memo on Insurance Coverage of Abortion,''
Guttmacher Institute (July 22, 2009; updated Sept. 18, 2009) (available
at http://www.guttmacher.org/media/inthenews/2009/07/22/index.html).
---------------------------------------------------------------------------
Some states impose restrictions on what abortion services
private insurance may cover. Currently, four states restrict
insurance coverage only to instances in which pregnancy
endangers the life of the woman; in those states abortion
coverage is only available through a separate rider at
additional cost.\5\ Additional states impose restrictions on
insurance for public employees.\6\
---------------------------------------------------------------------------
\5\``State Policies in Brief: Restricting Insurance Coverage of
Abortion,'' Guttmacher Institute (Oct. 1, 2009) (available at http://
www.guttmacher.org/statecenter/spibs/spib_RICA.pdf).
\6\Ibid.
---------------------------------------------------------------------------
Federal health programs (including Medicaid) are prohibited
from using federal funds to pay for abortion services by an
amendment added annually since 1977 to the Labor/HHS/
Appropriations bill.\7\ That amendment (popularly known as the
``Hyde Amendment'') in its current form prohibits the use of
federal funds for any abortion unless the pregnancy is the
result of rape or incest or is life-endangering.\8\ The
amendment affirmatively adds, however, that it does not
prohibit the expenditure of private funds by a state, locality,
entity, or private person.\9\ Indeed, while federal funds may
not be used to provide abortion services through Medicaid,
seventeen states pay for all or most medically necessary
abortions with their own funds and another six states use state
funds to pay for a limited group of abortions beyond the Hyde
Amendment.\10\
---------------------------------------------------------------------------
\7\Shimabukuro ``Abortion: Legislative Response,'' CRS Report for
Congress (Apr. 10, 2009).
\8\Cf. Secs. 506 and 507 of H.R. 3293 (``An Act making
appropriations for the Departments of Labor, Health and Human Services,
and Education, and related agencies for the fiscal year ending
September 30, 2010, and for other purposes'')(111th Congress, 1st
Session)(2009) (available at http://thomas.loc.gov/cgi-bin/query/
C?c111:./temp/-c111gEfpRH).
\9\Sec. 507(b) of H.R. 3293 (``An Act making appropriations for the
Departments of Labor, Health and Human Services, and Education, and
related agencies for the fiscal year ending September 30, 2010, and for
other purposes'')(111th Congress, 1st Session)(2009) (available at
http://thomas.loc.gov/cgi-bin/query/C?c111:./temp/-c111gEfpRH).
\10\``State Policies in Brief: State Funding of Abortion Under
Medicaid,'' Guttmacher Institute (October 1, 2009) (available at http:/
/www.guttmacher.org/statecenter/spibs/spib_SFAM.pdf).
---------------------------------------------------------------------------
Proposed Law
The legislation makes no changes to the Hyde Amendment. All
funds appropriated through the Labor/HHS Appropriations bill
each year will continue to be covered by its restrictions, as
they have for more than 30 years. But, with the exception of
those programs in Division C, most funds in this legislation
are not to be subject to annual appropriations and will not be
subject to the Hyde Amendment. The bill as originally
introduced was silent on abortion services, providing only a
broad list of health benefit categories and leaving the
determination of specific benefits to the Health Benefits
Advisory Committee and the Secretary. If no changes had been
made to the bill, it would have been possible to construe the
legislation to allow federal funds to be used to pay for
abortion services.
For this reason, the Committee adopted an amendment offered
by Congresswoman Capps (and already popularly known as the
``Capps Amendment''). That amendment places a number of
restrictions on abortion in health reform, which are discussed
in detail below. Most notably, it prohibits the use of
Affordability Credits (the federal funds in the bill that
assist people to purchase health insurance) to pay for
abortions that are not allowed by the Hyde Amendment. It also
prohibits all parties with decision-making authority (i.e., the
Secretary of HHS, the Commissioner of the Exchange, and the
Benefits Advisory Committee) from requiring that abortion
coverage be made a minimum benefit in health insurance; the
decision whether or not to cover abortion is to be made
individually by each plan in the Exchange. A detailed
description follows.
Under the terms of the bill, abortion cannot be made a
required minimum benefit; the bill notes every party that might
have a role in such a decision (i.e., the Secretary, the
Benefits Advisory Committee, and the Commissioner of the
Exchange) and prohibits each from requiring that abortion
services be made a minimum benefit. Instead, each private
insurance plan is allowed to decide on its own whether to cover
abortion. In the case of the public option, the Secretary of
HHS must decide if abortion will be covered. As such decisions
are made, the Commissioner (who administers the workings of the
Insurance Exchange) must assure that every region has at least
one plan that covers abortion and one plan that does not. (It
should be noted that Commissioner may designate as the plan
that does not cover abortion a plan that covers all of the Hyde
exceptions (i.e., rape, incest, or life-endangerment), some of
the Hyde exceptions, or none of them.)
Plans (including the public option) that do choose to cover
abortion may not pay for abortions beyond those permitted by
the Hyde Amendment with federal funds; those permitted by the
Hyde Amendment may be paid for with Federal funds. Inasmuch as
the Hyde Amendment is an annual decision by the Congress as
part of its appropriations process and has, over its history,
varied in its exceptions,\11\ the bill does not incorporate the
statutory language of the Hyde Amendment. Rather, the bill
adopts by cross-reference the Hyde Amendment to the Labor/HHS
Appropriations legislation as it is in force in any future
year. Thus, if the Hyde Amendment were amended to return to its
original form (i.e., including an exception only for life-
endangerment but not for rape or incest), the allowable use of
federal funds in plans in the Exchange would automatically be
restricted in the same way. Conversely, if the Hyde Amendment
were amended to include a new exception (e.g., fetal
abnormality, an exception included in a number of state
laws\12\), then the allowable use of federal funds in plans in
the Exchange would automatically be expanded in the same way.
The Committee has made this cross-reference in an attempt to
keep the use of federal funds for abortions consistent across
programs: Medicaid and other appropriated programs will be
governed by the annual Hyde Amendment; inasmuch as many
beneficiaries will likely move from Medicaid to the Exchange
(or vice versa) during a year, the Committee believes insurance
coverage through the Exchange should be parallel to coverage in
Medicaid. If abortion restrictions change in Medicaid, it will
be simpler for the beneficiary, her health care providers, and
program administration if the restrictions in the Exchange are
automatically the same. The Committee emphasizes that this
cross-reference itself makes no change in the Hyde Amendment
itself or in its application to any federal funds.
---------------------------------------------------------------------------
\11\Shimabukuro, ``Abortion: Legislative Response,'' CRS Report for
Congress, p. 13 (Apr. 10, 2009).
\12\``State Policies in Brief: State Funding of Abortion Under
Medicaid,'' Guttmacher Institute, p. 2 (Oct. 1, 2009) (available at
http://www.guttmacher.org/statecenter/spibs/spib_SFAM.pdf).
---------------------------------------------------------------------------
Under the legislation, the Commissioner of the Exchange is
required to estimate the actuarial cost of abortion coverage
beyond that allowed under the Hyde Amendment under a basic
plan. In a routine actuarial estimate of health services, one
might consider the cost offsets of such coverage; for instance,
in the case of abortion, the estimator might calculate the
foregone insurance costs of labor, delivery, and postnatal
care. In this case, however, the legislation forbids the
Commissioner from taking such offsets into account. The
Committee has taken these extra steps to ensure that the full
estimated cost is one that is covered solely by private dollars
and that federal funds are not used to pay for abortion
services.
After the Commissioner has estimated the actuarial cost of
abortion coverage, those plans that have voluntarily chosen to
include such coverage (including the public option, if the
Secretary chooses to have it cover abortion) must segregate
sufficient policyholder premium dollars to pay for abortion
services beyond those allowed by the Hyde Amendment. As with
the Hyde Amendment, no federal funding (meaning no general
revenue funds, no taxpayer funds, no public dollars, etc.) may
be used for this purpose. Premium dollars, however, are money
that comes directly from the insured person and goes directly
to their insurance plan; the funds are not deposited in the
Treasury, they do not come through Washington, and they do not
pass through the tax system. It is factually, legally, and
theoretically wrong to characterize these funds as federal
funds. Similar prohibitions on the use of federal funds by an
agency have widespread precedent: For example, federal
contractors may not use federal funds to lobby, and religious
organizations receiving federal assistance for a secular
purpose may not use federal funds to promote religion. These
prohibitions are successfully and routinely carried out with
accounting procedures and audits by both the administering
agencies and, in some instances, the Government Accountability
Office.
The legislation also affirmatively states that the bill
does not preempt any state laws regarding abortion (including
parental consent, waiting periods, etc.). In considering the
applicability of other aspects of health reform to the
insurance that state and local governments provide to their
employees, the Committee specifically discussed the limitations
that some states have imposed on abortion coverage. The
Committee was explicit that these limitations will be preserved
under the legislation and that similar limitations and
restrictions are to be allowed to continue.
The legislation also explicitly continues a variety of laws
popularly known as Abortion Conscience Clauses (i.e.,
permission for providers to refuse to provide abortions and not
to be discriminated against on that basis).\13\ Some of these
laws are permanent (e.g., the Church Amendment, adopted in
1973); others are annual (e.g., the amendments to the Labor/HHS
Appropriations Acts, popularly known as the Weldon Amendment).
---------------------------------------------------------------------------
\13\For a discussion of such laws, see Shimabukuro, ``The History
and Effect of Abortion Conscience Clause Laws,'' CRS Report for
Congress (Apr. 7, 2009).
---------------------------------------------------------------------------
In addition to the Capps Amendment, which continues
existing Abortion Conscience Clauses that already exist, the
Committee also adopted another amendment, authored by
Congressman Stupak, to create a new conscience clause
specifically for this legislation. This provision would
prohibit any public entity (federal, state, or local) that
receives funding under this Act (or an amendment made by this
Act) from discriminating against a health care entity on the
basis of that entity's unwillingness to provide, pay for,
provide coverage for, or refer for abortions.
DIVISION B--MEDICARE AND MEDICAID IMPROVEMENTS
TITLE I--IMPROVING HEALTH CARE VALUE
Subtitle A--Provisions Relating to Medicare Part A
Part 1--Market Basket Updates
Part 2--Other Medicare Part A Provisions
Subtitle B--Provisions Related to Part B
Part 1--Physicians' Services
Sec. 1121. Sustainable growth rate reform
Current Law
Medicare payments for services of physicians and certain
non-physician practitioners are made on the basis of a fee
schedule. The fee schedule assigns relative values to services
that reflect physician work (i.e., time, skill, and intensity
it takes to provide the service), practice expenses, and
malpractice costs. The relative values are adjusted for
geographic variation in costs. The adjusted relative values are
then converted into a dollar payment amount by a conversion
factor. The law specifies a formula, commonly referred to as
the sustainable growth rate (SGR) system, for calculating the
annual update to the conversion factors and the resultant fees.
If cumulative physician expenditures are below the
expenditure target, then an annual update is calculated based
on several variables including the Medicare Economic Index
(MEI). (Created in 1975, the MEI is an inflation index similar
to the Consumer Price Index that includes the prices of inputs
required for the production of physician services including the
physician's time, the cost of hiring employees such as
technicians and clerical staff, rent, medical equipment,
supplies, and drugs.) However, when cumulative physician
expenditures exceed the expenditure target, the SGR system
reduces the annual update factor (and therefore, all physician
reimbursements under the fee schedule) to attempt to bring
cumulative expenditures in line with the target.
Reductions resulting from application of the SGR have been
frequently overridden by legislation. Section 101 of the
Medicare, Medicaid, and SCHIP Extension Act of 2007 (P. L. 110-
173, MMSEA) increased the update to the conversion factor for
Medicare physician payment by 0.5% compared with 2007 rates for
the first six months of 2008. The Medicare Improvements for
Patients and Providers Act of 2008 (MIPPA, P.L. 110-275)
extended the 0.5% increase in the physician fee schedule that
was set to expire on June 30, 2008, through the end of 2008 and
set the update to the conversion factor to 1.1% for 2009. The
conversion factor for 2010 and subsequent years will be
computed as if this modification had never applied, so unless
further legislation is passed, the update formula will require
a 21% reduction in physician fees beginning January 1, 2010 and
by additional amounts annually for at least several years
thereafter.
The calculation of the expenditure target has been
criticized for including items that are not reimbursed under
the Medicare physician fee schedule. Specifically, MedPAC and
various physician organizations have suggested removing Part B
drugs from the calculation of the baseline and growth targets.
In its proposed rule for payment for physicians' services in
2010, CMS proposed removing Part B drugs from those targets.
Proposed Law
For the past several years, Congress has failed to make
substantive changes to the SGR mechanism.
Since 2002, Congress has enacted a series of short-term
fixes that have avoided payment reductions called for by the
SGR, but failed to address the fundamental flaws with the
formula. Meanwhile, the projected budgetary cost of
comprehensive reform to the SGR has soared and the depth of
required payment rate reductions has deepened.
The Committee has long recognized that the current update
methodology is unsustainable and must be replaced. This
legislation makes needed reforms that reflect more realistic
allowances for growth in spending on physician services, while
still holding physicians accountable for overall spending on
the services they provide.
Instead of grouping all physician expenditures together in
the calculation of the annual update to the fee schedule under
the SGR system, the bill would establish separate target growth
rates for evaluation and management services and for all other
services. This will help counteract the historical
undervaluation of those services. The bill would also rebase
the SGR baseline to 2009 expenditures for calculating future
expenditure targets.
Future update adjustments would be calculated against a new
baseline; the allowed expenditures for 2009 would be the amount
of the actual expenditures for physicians' services during
2009. Instead of setting the expenditure target using physician
expenditures since April 1, 1996, increased according to the
SGR system, the proposal would rebase the physician expenditure
target using physician expenditures beginning January 1, 2009,
with future targets determined under a new formula. The
proposal would also limit the services included in the target
growth rate computation to services covered under the physician
fee schedule.
The bill would modify how updates to the fee schedule would
be determined. For 2010, the update to the single conversion
factor would be the percentage increase in the MEI. To
calculate future updates, separate target growth rates would be
established for 2 categories of services: evaluation and
management services and all other services. Evaluation and
management services would include procedure codes for Medicare
covered services in the category designated Evaluation and
Management in the Health Care Common Procedure Coding and
Medicare-covered preventive services. The service categories
would apply without regard to the specialty of the physician
providing the service. The calculation of the update factors
would be based on physician expenditures in these categories
beginning January 1, 2009.
The application of multiple conversion factors would begin
with 2011. The initial conversion factors for 2011 would be
based upon the single conversion factor for 2010 multiplied by
the update factors for such category for 2011. To update the
conversion factors for the two service categories in subsequent
years, the conversion factor for each category for the previous
year would be adjusted by the update established for the
category.
In determining the allowed expenditures for 2010, total
2009 actual expenditures for all services included in the SGR
computation for each service category would be increased by the
growth rate to obtain 2010 allowed expenditures for each
service category. In subsequent years, the amount of allowed
expenditures for such category would be the allowed
expenditures for the preceding year increased by the target
growth rate (as described below) for such category and year.
Each category would have a separate target growth rate. The
target growth rate for a year, beginning with 2010, would be
computed and applied separately for each service category as
defined above and would be computed using the same method for
computing the target growth rate except that the update to the
conversion factor for evaluation and management services as
well as Medicare covered preventive services would be allowed
to increase by the percentage growth rate of GDP per capita
plus 2 percentage points, while the increase for all other
physicians' services would be allowed to grow at the percentage
rate of increase in GDP per capita plus 1 percentage point. The
Secretary would publish the target growth rate for such
succeeding year and each of the 2 preceding years by November 1
of each year.
Creating two separate expenditure targets and allowing
higher growth for evaluation and management and preventive
services infuses additional resources into these services to
encourage their use. Furthermore, removing labs, drugs, and
other ``incident to'' services from the calculation will result
in the targets being more closely aligned with actual spending
for physician services, rather than drug price inflation. Where
the current system imposes a growth target of per capita GDP,
the provision will allow spending to grow at GDP + 2 or GDP + 1
for each category, a target more in line with expected and
historical growth in medical spending. A more realistic target
will create a more stable payment system while still
maintaining spending restraints in payments for physician
services.
Providers participating in the accountable care
organization (ACO) pilot program would have the option of
pursuing separate target growth amounts applicable only that
organization. No later than January 1, 2012, the Secretary
would develop a method that would (1) allow each ACO to have
its own Medicare Part B expenditure targets and updates that
would be consistent with the methodologies described above, and
(2) provide that the target growth rate applicable to other
physicians would not apply to physicians to the extent that
their services are furnished through the ACO. This method would
apply beginning with 2012. In determining the expenditure
targets and updates for physicians in the ACO pilot program,
the Secretary could apply the difference in the update on a
claim-by-claim or lump sum basis and such a payment would be
taken into account under the pilot program. Allowing
accountable care organizations to have their own unique
spending targets will increase the incentive for physicians to
form or join such organizations. Physicians who participate in
ACOs and choose to have their own spending targets will be held
harmless from growth of physicians outside the ACO, further
incentivizing those physicians to participate in an ACO
arrangement.
Sec. 1122. Misvalued codes under the physician fee schedule
Current Law
The Medicare physician fee schedule is based on assigning
relative weights to each of the approximately 7,500 physician
service codes used to bill Medicare. The relative value for a
service compares the relative work involved in performing one
service with the work involved in providing other physicians'
services. The scale used to compare the value of one service
with another is known as a resource-based relative value scale
(RBRVS).
The Centers for Medicare and Medicaid Services (CMS), which
is responsible for maintaining and updating the fee schedule,
continually modifies and refines the methodology for estimating
relative value units (RVUs). CMS relies on advice and
recommendations from the American Medical Association/Specialty
Society Relative Value Scale Update Committee (RUC) in its
assessments. In general, as currently implemented, increases in
RVUs for a service or number of services lowers the resultant
fees for other physician services. One consequence has been
that the payments for evaluation and management codes, whose
RVUs typically are not increased over time, have fallen
relative to other codes whose RVUs have increased as a
consequence of new technologies that have been introduced into
coverage with relatively high RVUs. CMS is required to review
the RVUs no less than every five years.
In determining adjustments to RVUs used as the basis for
calculating Medicare physician reimbursement under the fee
schedule, the Secretary has authority to adjust the number of
RVUs for any service code to take into account changes in
medical practice, coding changes, new data on relative value
components, or the addition of new procedures. The Secretary is
required to publish an explanation of the basis for such
adjustments.
These adjustments are subject to a budget neutrality
condition. With the exception of certain expenditures that are
exempt by statute, the adjustments may not cause the amount of
expenditures made under the Medicare physician fee schedule to
differ from year to year by more than $20,000,000 from the
expenditures that would have been incurred without such an
adjustment.
Under current law, the Secretary appoints 15 physicians
(nominated by physicians organizations) to form the Practicing
Physicians Advisory Council, including both participating and
nonparticipating physicians and physicians practicing in rural
areas and underserved urban areas. This council meets each
quarter to discuss certain proposed changes in regulations and
carrier manual instructions related to physician services
identified by the Secretary.
Proposed Law
Traditionally the five-year review has led to more
increases in work RVUs than decreases. MedPAC and other
observers have stated that more attention needs to be given to
the accurate valuation of services in order to maintain the
integrity of the fee schedule.
The provision gives clearer direction to the Secretary to
maintain accurate valuation of services and prioritizes
identification of potentially misvalued codes. The provision
also addresses concerns that CMS does not have the resources or
administrative authority to conduct such reviews by providing
funding to the agency. Providing additional resources will
promote collection of more timely and accurate data that can be
used to improve valuation of services.
The Secretary would periodically identify and make
appropriate adjustments to the relative values for the services
identified as being potentially misvalued. The Secretary would
examine the following, as appropriate: (1) codes (and families
of codes as appropriate) for which there has been the fastest
growth; (2) codes (and families of codes as appropriate) that
have experienced substantial changes in practice expenses; (3)
codes for new technologies or services within an appropriate
period (such as three years) after the relative values are
initially established for such codes; (4) multiple codes that
are frequently billed in conjunction with furnishing a single
service; (5) codes with low relative values, particularly those
that are often billed multiple times for a single treatment;
(6) codes that have not been subject to review since the
implementation of the RBRVS (the so-called Harvard-valued
codes''); and (7) such other codes determined to be appropriate
by the Secretary.
In conducting the review and adjustments (1) the Secretary
could use existing processes to receive recommendations on the
review and appropriate adjustment of potentially misvalued
services; (2) the Secretary could conduct surveys, other data
collection activities, studies, or other analyses as
appropriate to facilitate the review and appropriate
adjustment; (3) the Secretary could use analytic contractors to
identify and analyze potentially misvalued services identified,
conduct surveys or collect data, and make recommendations on
the review and appropriate adjustment of services; (4) the
Secretary could coordinate the review and appropriate
adjustment with the existing periodic (no less often than every
5 years) review of the relative values; (5) the Secretary could
make appropriate coding revisions (including using existing
processes for consideration of coding changes) that could
include consolidation of individual services into bundled codes
for payment under the fee schedule; and (6) the Secretary would
apply the existing budget neutrality condition that applies to
relative value adjustments to this proposal.
The Secretary would establish a process to validate
relative value units under the fee schedule. The evaluation
process could include validation of work elements (such as
time, mental effort and professional judgment, technical skill
and physical effort, and stress due to risk) involved with
furnishing a service and could include validation of the pre,
post, and intra-service components of work. The validation of
work relative value units would include a sampling of codes for
services that is the same as the potentially misvalued codes
described above.
The Secretary could conduct the validation using methods
described above to identify potentially misvalued services, as
the Secretary determines to be appropriate. Following the
evaluation, the Secretary would make appropriate adjustments to
the work relative value units under the fee schedule. The same
budget neutrality provision would apply to adjustments to
relative value units made as a result of the evaluation.
For FY2010 and each subsequent fiscal year, $20 million
would be appropriated to the CMS Program Management Account to
carry out the provisions described above. The amounts
appropriated for a fiscal year would be available until
expended.
The provision also clarifies how certain existing statutes
might pertain to the proposals contained in this section.
Chapter 35 of title 44 of the United States Code, pertaining to
the Coordination of Federal Information Policy, and the
provisions of the Federal Advisory Committee Act (5 U.S.C.
App.) would not apply to the modifications proposed in this
section. Notwithstanding any other provision of law, the
Secretary could implement the proposed modifications in order
to identify, adjust, and evaluate potentially misvalued codes
by program instruction or otherwise. Section 4505(d) of BBA,
which placed requirements on how the Secretary developed the
practice expense RVUs, would be repealed. Except for provisions
related to confidentiality of information, the provisions of
the Federal Acquisition Regulation would not apply to this
section or the amendment made by this section. Finally, the
statute establishing the Practicing Physicians Advisory Council
would be repealed.
Sec. 1123. Payments for efficient areas
Current Law
Medicare uses a fee schedule to reimburse physicians for
the services they provide. In certain circumstances, physicians
receive an additional payment to encourage targeted activities.
These bonuses, typically a percentage increase above the
Medicare fee schedule amounts, can be awarded for a number of
activities including demonstrating quality achievements,
participating in electronic prescribing, or practicing in
underserved areas.
Proposed Law
The proposal would create new incentive payments for
``efficient'' areas. Providers delivering services on or after
January 1, 2011, and before January 1, 2013, who practice in an
area identified as an ``efficient'' area would receive an
additional payment (on a monthly or quarterly basis) equal to
5% of the payment amount for the Medicare Part B services.
Based upon available data, the Secretary would identify
those counties or equivalent areas in the United States in the
lowest fifth percentile of utilization based on per capita
spending for Medicare part A and part B services provided in
the most recent year for which data are available as of the
date of the enactment. The Secretary would standardize per
capita spending to eliminate the effect of geographic
adjustments in payment rates.
For purposes of the additional payment for providers in
``efficient'' areas, if the Secretary were to use the 5-digit
postal ZIP Code where the service is furnished, the dominant
county of the postal ZIP Code would be used to determine
whether the postal ZIP Code is in a county described as an
``efficient'' area. There would be no administrative or
judicial review respecting (1) the identification of a county
or other area as an efficient area; or (2) the assignment of a
postal ZIP Code to a county or other area designated as an
efficient area.
The Secretary would identify counties or areas designated
as ``efficient'' as part of the proposed and final rule to
implement the physician fee schedule for the applicable year.
The Secretary would post the list of counties identified as
efficient on the CMS website.
Sec. 1124. Modifications to the Physician Quality Reporting Initiative
(PQRI)
Current Law
The Tax Relief and Health Care Act of 2006 (TRHCA, P.L.
109-432) required the establishment of a physician quality
reporting system that would include an incentive payment, based
on a percentage of the allowed Medicare charges for all such
covered professional services, to eligible professionals who
satisfactorily report data on quality measures. CMS named this
program the Physician Quality Reporting Initiative (PQRI). The
Medicare Improvements for Patients and Providers Act of 2008
(MIPPA, P.L. 110-275) made this program permanent and extended
the bonuses through 2010; the incentive payment was increased
from 1.5% of total allowable charges under the physician fee
schedule in 2007 and 2008 to 2% in 2009 and 2010.
Providers that successfully report for services provided in
calendar year 2009 will receive an incentive payment of two
percent of total allowable charges for the physician fee
schedule. Providers may choose claims-based reporting or
registry-based reporting. For claims-based reporting, providers
seeking incentive payments for the entire calendar year may
meet the requirement by reporting on one measures group for a
sample of 30 consecutive Medicare part B fee-for-service
patients (FFS), or report for one measures group for 80% of
applicable Medicare part B FFS. For providers seeking to report
for the six-month period beginning July 1, 2009, similar
criteria apply for those that report through CMS approved
registries.
Proposed Law
The PQRI program has the potential to be a valuable tool
measuring the quality of services furnished by physicians to
Medicare beneficiaries. However, its potential usefulness has
been limited by problems with the way the initiative has been
implemented. This provision addresses those problems, extends
the payment initiative for two years, and improves the program
by integrating it with the incentive program for the adoption
and use of health information technology.
Not later than January 1, 2011, the Secretary would develop
and implement a mechanism to provide timely feedback to
eligible professionals on the performance of the eligible
professional with respect to satisfactorily submitting data on
quality measures under the PQRI program.
Not later than January 1, 2011, the Secretary would
establish and have in place an informal process for eligible
professionals to appeal the determination that an eligible
professional did not satisfactorily submit data on quality
measures for the PQRI program.
The bill would integrate physician quality reporting under
the PQRI and EHR reporting relating to the meaningful use of
EHR. The integration would consist of the following: (1) the
development of measures that would both demonstrate meaningful
use of an electronic health record for purposes of EHR
reporting and provide information on the clinical quality of
the care furnished to an individual; (2) the collection of
health data to identify deficiencies in the quality and
coordination of care for Medicare beneficiaries; and (3) other
activities as specified by the Secretary. The Secretary would
develop such a plan no later than January 1, 2012.
Incentive payments under the PQRI program would be extended
by two years, through 2012; for each of the years 2009 through
2012, the bonus would be 2% of Part B payments.
Sec. 1125. Adjustment to Medicare payment localities
Current Law
The Medicare fee schedule pays providers differently
according to the geographic location, known as a Medicare
physician payment locality, in which the provider practices. By
construction, the costs of providing physician services were
relatively consistent within each payment locality at the time
when they were defined; sub-regions of a state were designated
as separate payment localities only if the data showed a marked
difference between the costs in that area compared with the
rest of the state.
Each year, the Centers for Medicare and Medicaid Services
(CMS) uses data from a number of sources to calculate separate
geographic practice cost indices (GPCIs) for each payment
locality for each of three component inputs required to produce
physician services (physician work, practice expense, and
medical malpractice insurance). For each locality, these 3
GPCIs are then combined to produce a weighted average index of
relative costs, called the geographic adjustment factor (GAF).
In constructing the payment localities, the Health Care
Financing Administration (HCFA, now CMS) used an iterative
criteria that compared the relative cost of a potentially
distinct locality with the GAFs in the rest of the state.
Localities that had GAFs at least 5% higher than the rest of
the state were designated as a separate locality; this process
was repeated until this condition was not met, whereupon the
remaining regions of the state were combined into one locality.
In 1996, HCFA reduced the number of Medicare localities for
physician payment by aggregating several existing contiguous
localities with similar costs and combining other localities to
create a single payment area for the entire state. As a result,
there are currently 89 Medicare physician payment localities
based on counties or aggregates of counties across the 50
states; some localities are the entirety of the state while
other states may have several payment localities. None of the
payment localities cross state lines.
Economic conditions have affected parts of the country
differently in the years since the payment localities were
created. If localities were to be created based on data from
recent years using the original methodology, the resulting
number and composition of the payment localities might not be
the same as the ones that currently exist.
Proposed Law
A GAO report issued July 2007 confirmed significant
problems with inaccurate pricing that result from current
methodology used to establish Medicare's payment localities.
While the problem is not limited to California, during the last
15 years that state has experienced some of the largest
economic and demographic shifts, leading to large disparities
between local costs and geographic price adjustments. Revising
and updating the state's payment localities to reflect costs at
the Metropolitan Statistical Area (MSA) level will achieve a
balance between price accuracy and administrative feasibility.
In order to minimize the effect of resources shifting from one
area of the state to another that result from this change, the
provision provides temporary relief to counties in California
that would be adjusted downward. The payment localities used as
the basis for the geographic adjustment of Medicare physician
payments under the fee schedule would be changed in the state
of California. Under the proposal, payments to California
physicians would transition from a system based on the current
localities to one based on MSAs. For services furnished on or
after January 1, 2011, the Secretary would revise the Medicare
physician payment areas for the State of California to be based
on MSAs.
The methodology for constructing the new payment areas
would be similar to the original methodology, but the Core-
Based Statistical Areas-Metropolitan Statistical Areas, as
defined by the Office of Management and Budget (OMB), would be
used as the geographic units for comparing GAFs. First, the
Secretary would list all MSAs within California by their GAFs
in descending order. In the first iteration, the Secretary
would compare the GAF of the highest-cost MSA in the state to
the weighted-average GAF of the group of remaining MSAs in the
state. If the ratio of the GAF of the highest-cost MSA to the
weighted-average GAF of the rest of state is 1.05 or greater
then the highest-cost MSA becomes a separate fee schedule area.
In each subsequent iteration, the Secretary would compare the
MSA of the next-highest GAF to the weighted-average GAF of the
group of remaining MSAs. If the ratio of the next-highest MSA's
GAF to the weighted-average of the remaining lower-cost MSAs is
1.05 or greater, that MSA would become a separate fee schedule
area. The iterative process would continue until the ratio of
the GAF of the highest-cost remaining MSA to the weighted-
average of the remaining lower-cost MSAs is less than 1.05, and
the remaining group of lower-cost MSAs would form a single fee
schedule area. If two MSAs were to have identical GAFs, they
would be combined in that step of the iterative comparison.
The provision would require that no GPCIs be reduced during
the first 5 years of the transition from the former county-
based payment localities to the MSA-based fee schedule areas.
For services furnished in California on or after January 1,
2011, and before January 1, 2016, the Secretary would increase
any such index to the county-based fee schedule area value on
December 31, 2009, if the index under the new calculation would
be less than the value on January 1, 2010.
The new fee schedule areas would be subject to periodic
review and adjustments. Not less often than every 3 years, the
Secretary would review and update the California Rest-of-State
fee schedule area using MSAs as defined by the OMB applying the
iterative methodology described above. This revision would be
made effective concurrently with the application of the
periodic review of the adjustment factors required under
current law for California for 2012 and subsequent periods and
would be linked to the review of the GPCIs for all fee schedule
areas that occurs not less often than every 3 years. Upon
request, the Secretary would make any county-level or MSA
derived data used to calculate the geographic practice cost
index available to the public.
Sec. 1126. Resource-based feedback program for physicians in Medicare
Current Law
Both MedPAC and the Government Accountability Office (GAO)
have suggested that CMS provide information to physicians on
their resource use with the expectation that physicians who are
outliers would alter their practice patterns as a result.
MedPAC asserts that physicians would be able to assess their
practice styles, evaluate whether they tend to use more
resources than their peers, evaluate what evidence-based
research (if available) recommends, and revise practice styles
as appropriate. MedPAC notes that in certain instances, the
private sector use of feedback has led to a small downward
trend in resource use. The GAO notes that certain public and
private health care purchasers routinely evaluate physicians in
their networks using measures of efficiency and other factors
and that the purchasers it studied linked their evaluation
results to a range of incentives to encourage efficiency.
Section 131(c) of MIPPA established such a physician
feedback program, which CMS initiated before January, 2009. The
Physician Feedback Program uses Medicare claims data and other
data to provide confidential feedback reports to physicians
(and as determined appropriate by the Secretary, to groups of
physicians) that measure the resources involved in furnishing
care to Medicare beneficiaries. CMS initially called this
effort the Physician Resource Use Feedback Program, but has
renamed this initiative the ``Physician Resource Use
Measurement and Reporting Program.'' The program would consist
of multiple phases. The interim final rules for phase I of the
program include the following parameters: (1) the program will
use both per capita and episode of care methodologies to
measure resource use; (2) the program will include a cost of
service category analysis (for example, imaging services or
inpatient admissions); (3) four calendar years of claims data
will be used; (4) the feedback program will focus on high cost
and/or high volume conditions; (5) feedback will also include
reporting to physician specialties relevant to the selected
focal conditions; (6) the program will focus on physicians
practicing in certain geographic areas, and (7) the program
will establish low, median, and high cost benchmarks.
MIPPA also requires the GAO to conduct a study of the
Physician Feedback Program as described above, including the
implementation of the Program, and to submit a report to
Congress by March 1, 2011, containing the results of the study,
together with recommendations for such legislation and
administrative action as the Comptroller General determines
appropriate.
Proposed Law
The proposal would expand and strengthen the existing
physician feedback program. The feedback reports would include
measures of the utilization of services under the Medicare
program based on claims data and would include quality data
under the existing physician quality reporting initiative
(PQRI) as well as other information determined to be
appropriate. These reports would be provided confidentially to
physicians and other practitioners (those who furnish services
for which payment is made under Medicare and for which such
payment would be made if furnished by a physician).
No later than December 31, 2010, in consultation with
physicians and others as appropriate, the Secretary would
develop an episode grouper or other resource analysis tool that
could be used to measure physician resource use. The Secretary
could update the grouper from time to time as appropriate.
The feedback reports would include information allowing the
comparison of a physician's resource use pattern to the use
patterns of peers. These reports could include resource use
data on a per capita basis, a per episode basis, or both. The
reports would include information regarding nationwide groups
of similarly situated physicians (taking into consideration
specialty, practice setting, and such other criteria as the
Secretary finds appropriate) and comparing the pattern of
services of each physician in the group to the group average
pattern of services. In the reports, the Secretary would
include details about the services, procedures, and relevant
clinical information to identify factors that could account for
significant variation of a physician from national norms, such
as high rates of elective surgeries, diagnostic services, or
other utilization attributable to the judgment of the
physician.
The Secretary would disseminate feedback reports and would
seek to establish the reports' validity and credibility to
physicians. The Secretary would experiment with communications
methods such as the following: (1) direct meetings between
contracted physicians, facilitated by the Secretary, to discuss
the contents of feedback reports, including any reasons for
divergence from national averages; (2) contracts with local,
non-profit entities engaged in quality improvement efforts at
the community level, who would use the feedback reports or
equivalent tools as specified by the Secretary, where any data
exchanged would be protected by appropriate privacy safeguards;
(3) mailings or other methods of communication that facilitate
large-scale dissemination; or (4) other methods specified by
the Secretary.
During 2011, the Secretary would evaluate the efficacy of
the feedback methods with regard to changing practice patterns
to improve quality and decrease costs. Taking into account the
cost of each method, the Secretary would expand the program by
developing a plan to disseminate feedback reports in a
significant manner in the regions and cities of the country
with the highest utilization of services under Medicare. The
Secretary would disseminate, to the extent practicable,
feedback reports in a manner consistent with the following: (A)
during 2011, at least 1,000 reports; (B) during 2012, at least
10,000 reports; (C) during 2013, at least 25,000 reports; (D)
during 2014 and subsequent years, reports to the physicians
with utilization within the highest 5 percent of physicians,
subject to the following authority to focus efforts. The
Secretary could focus the program and the dissemination of
feedback reports on appropriate subsets of physicians, such as
physicians who (1) practice in geographic areas that account
for unusually high rates of spending per capita, (2) treat
conditions that have a high cost or volume under Medicare, (3)
use a high amount of resources compared to other physicians, or
(4) treat at least a minimum number of Medicare beneficiaries.
The Secretary would establish a process by which a
physician could opt not to receive feedback reports under this
program. Chapter 35 of title 44, United States Code would not
apply to this section. Notwithstanding any other provision of
law, the Secretary could implement this feedback program
through program instruction or otherwise.
Part 2--Market Basket Updates
Sec. 1131. Incorporating productivity improvements into market basket
updates that do not already incorporate such improvements
Current Law
Medicare pays for hospital outpatient department services
under its outpatient prospective payment system (OPPS).
Generally, Medicare's OPPS base payment amount is increased
each year by an annual update that is linked to projected
changes in specific market basket (MB) indices which are
designed to measure the change in the price of goods and
services purchased by the provider. Starting in CY2009,
hospitals paid under OPPS that do not submit required quality
data will have the applicable MB percentage reduced by two
percentage points. The reduction would apply for that year and
would not be taken into account in subsequent years.
Ambulance services are paid on the basis of a national fee
schedule, which is being phased in. The national fee schedule
is fully phased-in for air ambulance services. For ground
ambulance services, payments through 2009 are equal to the
greater of the national fee schedule or a blend of the national
and regional fee schedule amounts. The portion of the blend
based on national rates is 80% for 2007-2009. In 2010 and
subsequently, the payments in all areas will be based on the
national fee schedule amount. The fee schedule amounts are
updated each year by the consumer price index for all urban
consumers (CPI-U).
Since January 1, 2008, Medicare pays for surgery-related
facility services provided in an ambulatory surgery center
(ASC) using a payment system based on the hospital OPPS. The
new payment system will be implemented over a four-year
transition period. Beginning in CY2010, the ASC conversion
factor will be updated annually using the CPI-U. This update
will be subject to a 2 percentage point reduction if required
quality data are not provided.
Clinical lab services are paid on the basis of area-wide
fee schedules. The fee schedule amounts are periodically
updated. The annual clinical laboratory test fee schedule
update adjustment for 2009-2013 will be the percentage increase
or decrease in the CPI-U minus 0.5 percentage points.
Except in Competitive Acquisition Areas where payments for
items and services are to be based on suppliers' bids, Medicare
pays for durable medical equipment (DME) on the basis of fee
schedules. Items are classified into five groups for
determining the fee schedules and making payments: (1)
inexpensive or other routinely purchased equipment (defined as
items costing less than $150 or which are purchased at least
75% of the time); (2) items requiring frequent and substantial
servicing; (3) customized items; (4) oxygen and oxygen
equipment; and (5) other items referred to as capped rental
items. In general, fee schedule rates are established locally
and are subject to national limits. In general, fee schedule
amounts are updated annually by the CPI-U. Updates were
eliminated for 1998-2000; payments were increased by the CPI-U
for 2001; and payments were frozen for 2002. MMA eliminated the
updates for 2004-2008. In 2009, for items and services selected
before July 1, 2008 to be part of a Competitive Acquisition
Program for durable medical equipment, prosthetics, orthotics,
and supplies (DMEPOS), the update was a decrease of 9.5
percent. This decrease applied across geographic areas and was
not restricted to Competitive Acquisition Areas. This
adjustment allowed provisions in the Medicare Improvements for
Patients and Providers Act of 2008 (MIPPA, P.L. 110-275)
delaying the implementation of the Competitive Acquisition
Program to be budget neutral. For items and services that had
not been selected before July 1, 2008, to be part of the
Competitive Acquisition Program, the payment update for 2009
was the CPI-U. For 2010 through 2013, the updates are to be the
CPI-U. In 2014, if an item received a payment decrease in 2009,
the update is to be equal to the CPI-U plus 2 percentage
points, otherwise the update is to be the CPI-U. Starting in
2015, the update is to be the CPI-U. Payment updates for DME do
not include an adjustment for productivity.
Proposed Law
The annual update to the Medicare physician fee schedule
already incorporates adjustments for gains in productivity.
This provision creates uniformity across Medicare providers by
creating a productivity adjustment for other Part B providers.
This adjustment will encourage greater efficiency in health
care provision, hold Medicare providers accountable for
achieving productivity gains on par with the overall economy,
and more accurately align Medicare payments with provider
costs.
The productivity adjustment would equal the percentage
change in the 10-year moving average of annual economy-wide
private nonfarm business multi-factor productivity. The
estimate used would be that published before the promulgation
of the regulation establishing increases in the Medicare rates
for the year or period. The productivity adjustment would be
included in annual updates for OPPS, ambulance services,
clinical laboratory services, and certain durable medical
equipment years beginning in CY2010. The productivity
adjustment would be the same as that applied to providers in
Part A established under Section 1103 of the bill.
Starting in CY2010, to the extent an annual percentage
change factor applies to ASC services, it would include the
productivity adjustment.
Part 3--Other Provisions
Sec. 1141. Rental and purchase of power-driven wheelchairs
Current Law
Wheelchairs, including power-driven wheelchairs, are
covered by Medicare Part B under the capped-rental category of
the durable medical equipment (DME) benefit. Medicare pays for
power-driven wheelchairs in one of two ways: either Medicare
will pay the supplier a monthly rental amount during the
beneficiary's period of medical need (though payments are not
to exceed 13 continuous months), or, payment is made on a lump-
sum basis at the time the supplier furnishes the chair, if the
beneficiary chooses the lump-sum payment option. The same
payment choice applies to replacement power-driven wheelchairs
as well.
Medicare covers over 600 power wheelchair models under 42
procedure codes (Healthcare Common Procedure Coding System,
HCPCS). Power wheelchairs are further classified into 3 broad
groups based on their reported performance in categories such
as speed, range of travel and the height of the vertical
obstruction they can climb. Group 3 must meet the highest
performance standards. Group 2 and Group 1 must meet
intermediate and the lowest performance requirements,
respectively. For example, a Group 3 wheelchair must be able to
travel a minimum of 12 miles on a single charge of its
batteries, while the minimum travel requirements for Group 2
and Group 1 chairs are 7 and 5 miles, respectively.
The Secretary is required to establish a competitive
acquisition program for specified durable medical equipment;
the competitive acquisition program would replace the Medicare
fee schedule payments. The program is to be phased-in, starting
in 10 of the largest metropolitan statistical areas (MSAs) in
2009; expanding to 80 of the largest MSAs in 2011 and remaining
areas after 2011. The Secretary is permitted to phase-in first
items and services with the highest cost and highest volume, or
those items and services that the Secretary determines to have
the largest savings potential first, which includes power-
driven wheelchairs in the initial round of bidding.
Proposed Law
This provision would restrict the ``lump-sum'' payment
provision for new and replacement power-driven wheelchairs to
those recognized by the Secretary as classified within Group 3
or higher. The provision would be effective for chairs
furnished on or after January 1, 2010, but would not apply to
competitive bidding areas where bids had been submitted before
October 1, 2010.
There are a sizeable number of wheelchairs purchased by
Medicare during the first month of use that are not used beyond
the 13 month rental period. By eliminating the first month full
purchase option, the provision reduces waste in the Medicare
program. This change protects beneficiaries from the burden of
paying the cost-sharing associated with the wheelchair in one
lump sum.
The practical requirements of patients with complex
conditions such as quadriplegia and Louis Gehrig's disease
usually justify the outright purchase of mobility devices
rather than rentals. These special needs patients require
wheelchairs that are highly customized, use complex
technologies, and are in use for very long periods--if not the
rest of the patient's lifetime. As such, the provision
continues to allow for first-month purchase of complex mobility
devices classified as Group 3 or higher.
Sec. 1141A. Election to take ownership, or to decline ownership, of a
certain item of complex durable medical equipment after the 13-
month capped rental period ends
Current Law
Pressure reducing support surfaces are used for the care or
prevention of pressure ulcers. A pressure ulcer, also known as
a bedsore, is an area of the skin that breaks down when the
person stays in one position for too long without shifting his
or her weight. Pressure reducing support surfaces are covered
by Medicare Part B under the capped-rental category of the
durable medical equipment (DME) benefit. For beneficiaries that
fulfill coverage criteria for a pressure reducing support
surface, Medicare will pay the supplier a monthly rental amount
during the beneficiary's period of medical need (though
payments are not to exceed 13 continuous months). On the first
day after the thirteenth continuous month of rental payments,
the supplier of the item is required to transfer title of the
item to the beneficiary.
After the supplier transfers title to the beneficiary,
Medicare pays for maintenance and servicing for parts and labor
not otherwise covered under a manufacturer's warranty if the
Secretary determines that payments are reasonable and
necessary. Payment amounts for such maintenance and services
are determined by the Secretary.
Support surfaces come in different categories. A Group 3
support surface is a complete bed system known as air-fluidized
beds. It simulates the movement of fluid by circulating
filtered air through silicone-coated ceramic beads.
Proposed Law
This provision would eliminate the automatic transfer of
title of group 3 support surfaces to beneficiaries after 13
months of continuous use. Effective upon enactment, this
provision would require DME suppliers, during the tenth
continuous month of rental, to offer the beneficiary the option
to accept or reject the transfer of title to a Group 3 support
surface after the thirteenth month of rental. The beneficiary
would be deemed to reject the title, unless it was accepted
within one month of the offer.
If the individual accepted the title, it would be
transferred on the first day that begins after the thirteenth
month of continuous rental; reasonable and necessary
maintenance and servicing not otherwise covered by a
manufacturer's warranty would be covered by Medicare, as under
current law. If the beneficiary did not accept the title,
payments for maintenance and servicing would be as follows: no
maintenance and serving payment during the first 6 months
following the 13 continuous months of rental payments; during
the first month of each succeeding 6 month period, a
maintenance and servicing payment could be made, (for parts and
labor not covered by the supplier's or manufacturer's warranty
as determined by the Secretary, to be appropriate for Group 3
support surfaces) and in an amount equal to the lower of (a) a
reasonable and necessary maintenance and servicing fee or fees
established by the Secretary, or (b) 10% of the total purchase
price, as specified.
Sec. 1142. Extension of payment rule for brachytherapy
Current Law
The Medicare Prescription Drug, Improvement and
Modernization Act (MMA, P.L. 108-173) required Medicare's
outpatient prospective payment system to make separate payments
for specified brachytherapy sources. As mandated by the Tax
Relief and Health Care Act of 2006 (TRHCA, P.L. 109-432), this
separate payment was made using hospitals' charges adjusted to
their costs until January 1, 2008. The Medicare, Medicaid, and
SCHIP Extension Act of 2007 (MMSEA, P.L. 110-173) extended cost
reimbursement for brachytherapy services until July 1, 2008.
The Medicare Improvements for Patients and Providers Act of
2008 (MIPPA, P.L. 110-275) extended cost reimbursement for
brachytherapy until January 1, 2010.
Proposed Law
The provision would extend cost reimbursement for
brachytherapy until January 1, 2012.
Sec. 1143. Home infusion therapy report to Congress
Current Law
Infusion therapy involves the administration of medication
through a needle or a catheter. If a physician determines that
it is medically appropriate for a particular patient, some
infusion therapies may be provided in a patient's home.
Infusion therapies that can be provided in the home include
treatments such as antibiotic therapy, chemotherapy, pain
management, and hydration therapy.
Infusion drugs administered in a patient's home are covered
under the Medicare Part D drug benefit and in some cases when
such drugs are furnished incident to covered durable medical
equipment. Medicare Part D does not, however, cover supplies,
equipment, or professional services associated with home
infusion therapy.
Proposed Law
The Committee is exploring options to promote home and
community-based care to allow beneficiaries to remain healthy
and independent. Expanded Medicare coverage of home infusion
therapy has the potential to achieve these results for the
Medicare program and for beneficiaries. It is possible that if
infusion therapy was more widely available in the home setting,
Medicare beneficiaries could avoid the higher costs associated
with being admitted to hospitals and nursing homes for this
treatment. They also could avoid the serious risk of
healthcare-acquired infections, which is a growing problem in
institutional settings. The Committee directs the Medicare
Payment Advisory Commission to assess the potential benefits of
complete coverage of home infusion therapy under Medicare and
provide recommendations to Congress as to whether and how the
Medicare program can efficiently and effectively provide such
coverage, after considering how home infusion is covered and
paid for by private health plans and Medicare Advantage plans.
The provision would require the Medicare Payment Advisory
Committee (MedPAC) to submit a report to Congress not later
than 12 months after the date of enactment. The report would be
required to include (a) an analysis of the scope of coverage
for home infusion therapy services (and the scope of services
provided) in traditional Medicare, Medicare Advantage, the
Veterans Health Administration, and among private payers; (b)
the benefits and costs of providing such coverage under the
Medicare program, including a calculation of the potential
savings achieved through avoided or shortened hospital or
nursing home stays; (c) an assessment of data on home infusion
therapy that might be used to construct payment mechanisms
under Medicare and (d) recommendations, if any, on the
structure of a payment system under the Medicare program for
home infusion therapy services, including an analysis of MA and
private plan payment methodologies for home infusion therapy
and their applicability to the Medicare program.
Sec. 1144. Require Ambulatory Surgical Centers (ASCs) to submit cost
data and other data
Current Law
Ambulatory surgery centers (ASCs) must meet certain health,
safety, and other specified standards in order to participate
in Medicare. The Centers for Medicare and Medicaid Services
implemented a new payment system for ASCs on January 1, 2008.
The new payment system, which is being phased-in over a 4-year
period, uses the ambulatory payment classification groups that
are the basis for Medicare's outpatient prospective payment
system (OPPS) for hospital outpatient departments. ASCs have
never been required to submit cost reports. In March 2009, the
Medicare Payment Advisory Commission recommended that Congress
require ASCs to submit cost data and quality data that would
allow for an effective evaluation of the adequacy of Medicare's
payment rates.
The number of Medicare-certified ASCs has grown
substantially in recent years, growing at an annual rate of 6.7
percent from 2002 to 2007. Spending per beneficiary also
increased substantially during that time period, growing at an
average annual rate of 8.4 percent, and receiving $2.9 billion
in payments from Medicare and beneficiary cost-sharing in 2007.
Ninety-one percent of ASCs have at least one physician-owner
and MedPAC has pointed out that the presence of physician
ownership of ASCs may influence referral patterns.
Proposed Law
MedPAC uses cost data to analyze the adequacy of Medicare
payments in many areas. However, cost data are not available
for ASCs, limiting MedPAC's ability to assess payment adequacy.
This provision instructs the Secretary to require ASCs to
submit reports on their facility costs as a condition for
agreeing to participate in Medicare. That data will allow
MedPAC to properly assess Medicare's payment adequacy for ASCs.
The specifications for the cost report data would take into
account the requirements for hospital cost data. No later than
3 years from enactment, an ASC cost reporting form would be
developed. The ASC cost reports would be periodically audited.
The requirements would apply to agreements applicable to cost
reporting periods beginning 18 months after the date the
Secretary develops the cost reporting form.
This provision also follows MedPAC's recommendation to
require reporting of quality data. Beginning in 2012, the
Secretary would require ASCs to report quality data, including
data on health care associated infections.
Sec. 1145. Treatment of certain cancer hospitals
Current Law
Eleven cancer hospitals are exempt from the inpatient
prospective payment system (IPPS) used to pay inpatient
hospital services provided by acute care hospitals.
Historically, they have been paid on a reasonable cost basis,
subject to certain payment limitations and incentives. These
hospitals are also held harmless under the outpatient
prospective payment system (OPPS) and will not receive less
from Medicare under this payment system than under the prior
outpatient payment system. Under OPPS, Medicare pays for
outpatient services using as defined by ambulatory payment
classification (APC) groups.
Proposed Law
The provision requires the Secretary to determine if the
costs incurred by cancer hospitals with respect to APCs exceed
those costs incurred by other hospitals reimbursed under OPPS.
If the costs in cancer hospitals exceed the costs incurred by
other hospitals, the Secretary would be required to provide for
an appropriate adjustment for cancer hospitals for outpatient
services furnished starting January 1, 2011.
The provision addresses concerns that the cost of
outpatient services at PPS-exempt cancer hospitals is greater
than that at other outpatient hospitals and that these higher
costs are not currently reflected and adequately reimbursed
under the current payment system. This provision directs CMS to
assess whether such a cost differential exists, and if so, to
remedy it. This provision supplements the existing hold
harmless provision under 1833(t)(7)(D)(ii) of the Social
Security Act as the hold harmless will continue to apply in the
situation where the combination of existing payments and any
payment change under this section results in a payment less
than the pre-BBA amount.
Sec. 1146. Medicare Improvement Fund
Current Law
Section 188 of MIPPA established the Medicare Improvement
Fund (MIF), available to the Secretary to make improvements
under the original fee-for-service program under Parts A and B
for Medicare beneficiaries. Under current law, $22.29 billion
are available to the Secretary for this purpose for services
furnished during FY2014. For fiscal year 2020 and in each
subsequent fiscal year, the amount in the fund would be the
Secretary's estimate, as of July 1 of the fiscal year, of the
aggregate savings in Medicare expenditures due to payment
reductions resulting from payment reductions imposed on various
Medicare providers as an incentive for the adoption and
meaningful use of certified EHR technology.
Proposed Law
Over the course of several years, money has been set aside
in the MIF to fund policies that would improve and modernize
the Medicare program. This provision would fulfill this intent
by using the MIF to offset important investments in Medicare
made by this bill. The remaining $8 billion will be available
to fund increases in payment rates implemented under section
1158, regarding Medicare geographic payment adjustments. Any
amount not spent under that section would remain in the MIF
through 2019.
Sec. 1147. Payment for Imaging Services
Current Law
Under the Medicare fee schedule, some services have
separate payments for the technical component and the
professional component. For example, imaging procedures
generally have two parts: the actual taking of the image (the
technical component), and the interpretation of the image (the
professional component). Medicare pays for each of these
components separately when the technical component is furnished
by one provider and the professional component by another. When
both components are furnished by one provider, Medicare makes a
single global payment that is equal to the sum of the payment
for each of the components.
CMS's method for calculating the Medicare fee schedule
reimbursement rate for advanced imaging services assumes that
imaging machines are operated 25 hours per week, or 50% of the
time that practices are open for business. Setting the
equipment use factor at a lower rather than at a higher rate
has led to higher payment for these services. Citing evidence
showing that the utilization rate is 90%, rather than the 50%
currently assumed, MedPAC has recommended CMS to use the higher
utilization rate in the calculation of fee schedule payments
for advanced imaging services.
According to MedPAC and the Government Accountability
Office (GAO), there are opportunities to improve the efficiency
of the Medicare fee schedule. In 2005, MedPAC recommended
reducing certain fees to account for efficiencies and savings
from the technical preparation and supplies achieved when
multiple imaging services are furnished sequentially on
contiguous body parts during the same visit. Starting January
1, 2006, physicians receive the full technical component fee
for the highest paid imaging service in a visit, but technical
component fees for additional imaging services are reduced by
25%.
The work relative value units in the Medicare physician fee
schedule were and are developed with input from the physician
community. Refinements in existing values and the establishment
of values for new services are included in the annual fee
schedule updates. The refinement and update process is based in
part on recommendations made by the American Medical
Association's Specialty Society Relative Value Update Committee
(RUC), which receives input from many physician specialty
societies. Current law requires a review of the relative values
every five years.
Section 1834(e)(1)(B) defines advanced diagnostic imaging
services to include diagnostic magnetic resonance imaging,
computed tomography, and nuclear medicine (including positron
emission tomography), and other diagnostic imaging services as
specified by the Secretary in consultation with physician
specialty organizations and other stakeholders.
Proposed Law
The utilization rate for calculating the payment for
advanced diagnostic imaging equipment as defined under current
law would be increased from 50% to 75%. For single session
imaging involving continuous body parts, the proposal would
reduce the technical component fees for additional imaging
services to 50%. These modifications would apply to services
furnished on or after January 1, 2011.
Recent MedPAC analysis found problems with the current
calculation of practice expenses for imaging providers. Low
assumptions about equipment use artificially inflate the price
Medicare pays for imaging services. MedPAC has recommended
increasing the utilization assumption for advanced imaging
equipment to more accurately reflect actual utilization rates.
MedPAC has also recommended reducing the technical
component for a second image on a contiguous body part. When a
second image on an adjacent body part is taken, the clerical
time, preparation, and supplies needed for the second image are
significantly reduced. In 2006, CMS administratively proposed
to reduce payment for the second image by 50 percent, but
eventually implemented a smaller 25 percent discount. By
increasing the discount to 50 percent, this provision would
reflect economies arising from studies on multiple body parts
and bring Medicare payment policy in line with private payers.
Sec. 1148. Durable medical equipment program improvements
Current Law
The Secretary is prohibited from issuing or renewing a
provider number for payment of Medicare durable medical
equipment, prosthetics, orthotics, and supplies (DMEPOS) claims
for a supplier unless the supplier provides the Secretary with
a surety bond of not less than $50,000. The Secretary may waive
this requirement in the case of a supplier that provides a
comparable surety bond under state law. The final regulation
exempts certain individuals from the surety bond requirement,
including certain physicians and non-physician practitioners,
physical and occupational therapists, state-licensed orthotic
and prosthetic personnel, and government-owned suppliers.
Medicare Part B pays for certain items of durable medical
equipment (DME) including oxygen and oxygen equipment. The
Deficit Reduction Act (DRA, P.L. 109-171) changed how long
Medicare would make rental payments for oxygen equipment. It
changed from the entire period of medical need, to a rental
period of 36-months. The Medicare Improvements for Patients and
Providers Act of 2008 (MIPPA, P.L. 110-275) requires suppliers
to continue furnishing the equipment during any period of
medical need for the remainder of the reasonable useful
lifetime of the equipment, which is defined by the Secretary as
5 years (or 60 months).
The Medicare Prescription Drug, Improvement, and
Modernization Act of 2003 (MMA, P.L. 108-173) required the
Secretary to establish and implement quality and accreditation
requirements for Medicare suppliers of DMEPOS. The Medicare
Improvements for Patients and Providers Act of 2008 (MIPPA,
P.L. 110-275) exempted a group of health care professionals
from having to become accredited unless the Secretary
determined the standards were designed specifically to be
applied to those professionals. The Secretary was given
authority to exempt certain professionals from the
accreditation requirement if the Secretary determined that
licensing, accreditation, or other mandatory quality
requirements applied to those professionals. The provision
identified some of the professionals subject to the provision,
including: physicians; physical or occupational therapists;
physicians assistants; nurse practitioners; clinical nurse
specialists; orthotists; and prosthetists.
For a description of DME payment policies, see section 1131
of this legislation.
Proposed Law
This section will make a number of technical changes to the
durable medical equipment program that will improve the program
for beneficiaries.
Surety Bond: This provision would waive the surety bond
requirement for a pharmacy that (1) supplies durable medical
equipment, prosthetics, orthotics, and supplies, (2) has been
issued a provider number for at least 5 years, and (3) has not
received an adverse action, as defined in the Code of Federal
Regulations.
Oxygen Equipment: This provision would modify the time
period during which the supplier would be required to furnish
medically necessary oxygen and oxygen equipment. As of the
twenty-seventh month of the 36 month rental period, the
supplier furnishing the equipment would be required to continue
furnishing the equipment (either directly or through
arrangements with other suppliers) during any subsequent period
of medical need for the remainder of the reasonable useful
lifetime of the equipment, as determined by the Secretary,
regardless of the location of the individual, unless another
supplier accepted the responsibility to furnish equipment
during the remainder of the period. This provision would be
effective upon enactment and would apply to equipment furnished
to individuals for whom the twenty-seventh month of a
continuous period of use occurred on or after July 1, 2010.
This provision would also allow a beneficiary to begin a
new 36-month rental period if the supplier who had been
furnishing oxygen and oxygen equipment to the beneficiary was
declared bankrupt and its assets were liquidated and at the
time of the declaration and liquidation more than 24 months of
rental payments had been made.
Accreditation: This provision would exempt pharmacies
enrolled as Medicare DMEPOS suppliers from the accreditation
requirement for the purposes of supplying diabetic testing
supplies, canes, and crutches. Any supplier that had submitted
an application for accreditation before August 1, 2009, would
be deemed as meeting applicable standards and accreditation
requirements under the subparagraph until the independent
accreditation organization took action on the supplier's
application.
Payment Adjustment: The provision would reduce the fee-
schedule update amount for covered items of durable medical
equipment for 2010, 2011, 2012, and 2013. The amount of the
update would be reduced by 0.5%. (The fee schedule update for
covered DME would also be subject to a productivity improvement
adjustment as described in Section 1131 of this bill.)
Sec. 1149. MedPAC study and report on bone mass measurement
Current Law
No current law.
Proposed Law
The Medicare Payment Advisory Commission would be
instructed to conduct a study regarding bone mass measurement,
including computed tomography, dual-energy x-ray
absorptriometry, and vertebral fracture assessment. The study
would focus on the following: (1) an assessment of the adequacy
of Medicare payment rates for such services, taking into
account costs of acquiring the necessary equipment,
professional work time, and practice expense costs; (2) the
impact of Medicare payment changes since 2006 on beneficiary
access to bone mass measurement benefits in general and in
rural and minority communities specifically; (3) a review of
the clinically appropriate and recommended use among Medicare
beneficiaries and how usage rates among such beneficiaries
compares to such recommendations; and (4) in conjunction with
the findings under (3), recommendations, if necessary,
regarding methods for reaching appropriate use of bone mass
measurement studies among Medicare beneficiaries. Not later
than 9 months after enactment, the Commission would submit a
report to the Congress containing a description of the results
of the aforementioned study and the conclusions and
recommendations, if any, regarding each of the issues described
above.
Sec. 1149A. Exclusion of customary prompt pay discounts extended to
wholesalers from manufacturer's average sales price for
payments for drugs and biologicals under Medicare part B
Current Law
Medicare Part B pays for a small number of drugs in certain
circumstances such as drugs administered to patients in
physician offices and outpatient departments. The Medicare
Prescription Drug Improvement and Modernization Act of 2003
(MMA, P.L. 108-173) established a Part B drug reimbursement
methodology based on the Average Sales Price (ASP) of drugs;
since January 2005, Medicare has paid for most physician
administered drugs based on 106% of the volume-weighted ASP for
each drug code. MMA defines ASP as the average manufacturer's
sales of a drug to all purchasers in the United States in a
given quarter. The ASP is net of any price concessions provided
by the manufacturer to the purchaser (e.g. the wholesaler,
group purchasing organization or provider) such as prompt pay
discounts, volume discounts, and rebates other than those
obtained through the Medicaid drug rebate program.
Proposed Law
This provision would exclude customary prompt pay
discounts, to the extent such discounts do not exceed 2% of the
product's wholesale acquisition cost, extended to wholesalers
from the calculation of ASP for drugs or biologicals sold on or
after January 1, 2011, and before January 1, 2016. The term
``wholesale acquisition cost'' means, with respect to a drug or
biological, the manufacturer's list price for the drug or
biological to wholesalers or direct purchasers in the United
States, not including prompt pay or other discounts, rebates or
reductions in price, for the most recent month for which the
information is available, as reported in wholesale price guides
or other publications of drug or biological pricing data.
Sec. 1149B. Timely access to post-mastectomy items
Current Law
Under Medicare Part B a breast prosthesis is covered for a
patient who has had a mastectomy. An external breast prosthesis
garment, with mastectomy form is covered for use in the
postoperative period prior to a permanent breast prosthesis or
as an alternative to a mastectomy bra and breast prosthesis.
The breast prosthesis and garment are not covered by Medicare
prior to the mastectomy or breast cancer surgery as there is no
medical need for the items.
Proposed Law
Upon enactment, the provision would specify that payment
for post-mastectomy external breast prosthesis garments would
be made regardless of whether the items are supplied to the
beneficiary prior to or after the mastectomy procedure or other
breast cancer surgical procedure. The Secretary would be
required to develop policies to ensure appropriate beneficiary
access and utilization safeguards.
Sec. 1149C. Moratorium on Medicare reductions in payment rates for
certain interventional pain management procedures covered under
the ASC fee schedule
Current Law
The Centers for Medicare and Medicaid Services implemented
a new payment system for ASCs starting on January 1, 2008. The
new payment system is being phased in over a 4-year period and
uses the ambulatory payment classification groups that are the
basis for Medicare's outpatient prospective payment system
(OPPS) for hospital outpatient departments. Under the new
payment system, Medicare's payments for certain services will
increase and those for other services will decrease relative to
payment amounts in use prior to 2008.
Proposed Law
Medicare payments for interventional pain management
services provided in ASCs starting January 1, 2010, and before
January 1, 2010, would be increased to be not less than the
payment rate in effect as of January 1, 2007, under the prior
payment system. This interventional pain services included
under this provision would be epidural injections, facet joint
injections, and sacroiliac joint injections.
Sec. 1149D. Medicare coverage of services of qualified respiratory
therapists performed under the general supervision of a
physician
Current Law
Under current law, respiratory therapists cannot be
reimbursed independently under the Medicare fee schedule, as
they are not included in the definition of physicians and other
providers. Thus, services provided by respiratory therapists
outside of hospital settings are generally covered as services
``incident to a physician's professional service.''
Accordingly, the physician must directly supervise the service
(meaning the physician must be physically present) when the
physician is not the one providing the service.
Proposed Law
The definition of ``medical and other health services''
would be amended to add a new subparagraph addressing
respiratory therapy and respiratory therapists. For purposes of
the Medicare program, respiratory therapy services would
include those services that are performed by a respiratory
therapist under the general (not direct) supervision of a
physician for the diagnosis and treatment of respiratory
illnesses (and would be physicians' services if furnished by a
physician). These services would be paid for under the Medicare
fee schedule, but only if no facility or other provider charges
are paid with respect to the furnishing of such services. The
term ``respiratory therapist'' would mean an individual who (1)
is credentialed by a national credentialing board recognized by
the Secretary, (2) is licensed to practice respiratory therapy
in the state in which the respiratory therapy services are
performed, or in the case of an individual in a state which
does not provide for such licensure, is legally authorized to
perform respiratory therapy services (in the state in which the
individual performed such services) under state law or the
state regulatory mechanism provided by state law, (3) is a
registered respiratory therapist; and (4) holds a bachelor's
degree.
Payment for these respiratory services furnished by a
respiratory therapist would be the amount equal to 80% of the
lesser of the actual charge for the services or 85% of the
Medicare fee schedule amount provided for the same services if
furnished by a physician. This change applies to services
furnished on or after January 1, 2010.
Subtitle C--Provisions Related to Medicare Parts A and B
Sec. 1151. Reducing potentially preventable hospital readmissions
Current Law
Medicare pays for most acute care hospital stays using a
prospectively determined payment for each discharge. Payment
also depends on the relative resource use associated with a
patient classification group, referred to as the Medicare
Severity diagnosis related groups (MS-DRGs), to which the
patient is assigned based on an estimate of the relative
resources needed to care for a patient with a specific
diagnosis and set of care needs. Medicare's inpatient
prospective payment system (IPPS) includes adjustments that
reflect certain characteristics of the hospital. For instance,
a hospital with an approved resident training program would
qualify for an indirect medical education (IME) adjustment;
hospitals that serve a sufficient number of poor Medicare or
Medicaid patients would receive higher Medicare payments
because of their disproportionate share hospital (DSH)
adjustment. Hospitals in Maryland are not paid using IPPS;
rather they receive Medicare payments based on a state-specific
Medicare reimbursement system.
Critical Access Hospitals (CAHs) are limited-service
facilities that are located more than 35 miles from another
hospital (15 miles in certain circumstances) or designated by
the state as a necessary provider of health care; offer 24-hour
emergency care; have no more than 25 acute care inpatient beds;
and have a 96-hour average length of stay. Medicare pays CAHs
on the basis of 101% of the reasonable costs of the facility
for inpatient and outpatient services. Certain aspects of the
CAH payment system are not subject to administrative or
judicial review.
According to Medicare Payment Advisory Commission's
(MedPAC) analysis of 2005 Medicare data, 6.2% of
hospitalizations of Medicare beneficiaries resulted in
readmission within 7 days and 17.6% of hospitalizations
resulted in readmission within 30 days. The 17.6% of hospital
readmission accounts for $15 billion in Medicare spending.
These readmission rates reflect the total number of
readmissions, including those that may not have been related to
the initial diagnosis and may not have been preventable.
MedPAC, CMS, and others have expressed concern that providers
do not have financial incentives to reduce potentially
preventable readmissions. In addition, MedPAC, in its June 2008
report, recommended that Medicare's payments to hospitals with
relatively high readmission rates for select conditions be
reduced.
Proposed Law
Hospital readmissions for Medicare beneficiaries are costly
and prevalent. Studies have demonstrated that almost 20% of
Medicare beneficiaries who had been discharged from a hospital
were rehospitalized within 30 days and accounted for almost $15
billion in spending in a year. A number of interventions at the
time of discharge have been shown to decrease readmissions.
Researchers have suggested that supportive palliative care and
increased efforts to coordinate prompt and reliable follow-up
care with primary care physicians by hospital providers would
reduce readmissions and increase patient satisfaction.
To reduce readmission rates, enhance quality of care and
improve coordination during discharge planning, policies for
the reduction of readmission rates have been recommended by
MedPAC. This section takes into account the recommendations set
forth by MedPAC regarding payment policies pegged to
readmission rates. The policy adjusts payments for hospitals,
critical access hospitals and hospitals paid under 1814(b)(3)
based on the dollar value of each hospital's percentage of
potentially preventable Medicare readmissions for 3 conditions
with measures that have been endorsed by NQF as risk-adjusted
readmission measures. It also directs the Secretary to expand
the policy to additional conditions in future years and
authorizes the Secretary to modify the adjustment based on a
hospital's performance in readmissions compared to a ranking of
hospitals nationally.
In addition, because care received after a discharge can be
a primary contributor to preventable readmission, the policy
incorporates penalties for post-acute care providers and
directs the Secretary to study whether similar penalties should
be applied to physicians.
Penalties for Hospitals. IPPS hospitals and those hospitals
in Maryland paid under a state-specific Medicare payment system
would receive reduced payments for potentially preventable
hospital readmissions occurring on or after October 1, 2011.
Under this proposal, hospitals with lower potentially
preventable readmission rates would receive smaller payment
reductions while hospitals with higher potentially preventable
readmission rates would receive higher payment reductions.
Certain components of Medicare hospital payments would be
exempt from these payment reductions.
Reduced hospital payments for readmissions would be
calculated by multiplying the base operating DRG payment amount
by an adjustment amount. The base operating DRG payment amount
is the base amount that would have been paid under IPPS reduced
by payments associated with IME and DSH. In the case of
hospitals in Maryland, the base amount would be the payment
amount under their state system.
The adjustment factor for a hospital in a fiscal year would
be the greater of (1) a floor adjustment factor equal to a
reduced percentage of the discharge payment or (2) the excess
readmissions ratio for the applicable fiscal year. The floor
adjustment factor would be 0.99 of the discharge payments in
FY2012, 0.98 of the discharge in FY 2013, 0.97 in FY 2014, or
0.95 in subsequent fiscal years. The excess readmissions ratio
would equal 1 minus the ratio of the aggregate payments for
excess readmissions for the hospital divided by the aggregate
payments for all discharges.
Aggregate payments for excess readmissions for a hospital
for a fiscal year would be the sum of the applicable conditions
of the product of the base operating DRG payment for each
applicable condition multiplied by the number of admissions for
each condition multiplied by the excess readmissions ratio
minus one. The excess readmissions ratio is the ratio of the
risk adjusted readmissions based on actual readmissions divided
by the risk adjusted expected readmissions. This number would
not be less than one. The ratio would be calculated for each
applicable condition for a hospital for the applicable period.
The aggregate payments for all discharges would be calculated
as the sum of the hospital's base operating DRG payments for
all discharges for all conditions for such a fiscal year.
Excess readmissions would be prohibited from including
conditions for which there are fewer than a certain minimum
number (as determined by the Secretary) of discharges within a
certain time period. To encourage hospitals to continue to
reduce their potentially preventable readmission rates over
time, beginning with discharges for FY2014, the Secretary would
be able to determine the excess readmissions ratio based on a
ranking of hospitals by readmission ratios (from lower to
higher readmissions) normalized to a benchmark that is lower
than the 50th percentile.
An applicable condition would be defined as a condition or
procedure that represents high volume or high expenditures for
Medicare or meets other specified criteria that also satisfies
certain measures of readmissions. These measures of readmission
would be those that have been endorsed by a consensus based
entity with a performance measurement contract under section
1890 of the Social Security Act, excluding readmissions that
are unrelated to the prior discharge (such as a planned
readmission or transfer to another applicable hospital).
Readmission would be defined as an admission to the hospital of
an individual who had been discharged from either the same or
another applicable hospital within a time period from the date
of discharge as specified by the Secretary.
Starting in FY2012, the Secretary would select 3 applicable
conditions that have been endorsed by the consensus based
entity as of the date of enactment. Beginning with FY2013, the
Secretary would be required to expand the list of applicable
conditions for such readmissions to include 4 conditions
identified by the MedPAC in its June 2007 Report to Congress.
The Secretary would also be able to include an appropriate all-
condition measure of readmissions. In expanding the list of
conditions, the Secretary would be required to seek the
endorsement by a consensus-based entity, but would be able to
apply such conditions without such endorsement.
The Secretary would be required to monitor activities of
applicable hospitals to determine if such hospitals took the
steps to avoid patients at risk to reduce the likelihood of
increasing readmissions for applicable conditions. If the
Secretary determines that such a hospital had taken such steps,
the Secretary could impose an appropriate sanction after having
provided notice to the hospital and the opportunity for that
hospital to alleviate such steps.
For fiscal years beginning on or after FY2011, the
Secretary would be required to increase DSH payments to
targeted hospitals that received $10 million or more in
disproportionate share payments in their most recently settled
cost report. These targeted hospitals would be required to
provide satisfactory assurances that the increased payments
would be used for transitional care activities. These would be
activities designed to address the patient noncompliance issues
that result in higher than normal readmission rates, such as
one or more of the following: (1) providing care coordination
services to assist in transitions from the targeted hospital to
another setting; (2) hiring translators and interpreters; (3)
increasing services offered by discharge planners; (4) ensuring
that individuals receive a summary of care and medication
orders upon discharge; (5) developing a quality improvement
plan to assess and remedy preventable readmission rates; (6)
assigning discharged individuals to a medical home; and (7)
doing other activities as determined by the Secretary.
The Secretary would estimate the percent of the DSH
increase subject to aggregate and hospital-specific caps. In
the aggregate, increases would not exceed 5% of the estimated
savings that would occur in a fiscal year from hospital
readmissions policies described above. For specific hospitals,
DSH increases would not exceed the estimated difference in
spending that would occur in a fiscal year for a hospital due
to the application of the excess readmissions policy. The
Secretary would make these additional DSH payments on a lump
sum basis, a periodic basis, a claim by claim basis or in any
other form deemed appropriate. Not later than 3 years after
funds are first made available, GAO would be required to submit
a report on the use of such funds.
No administrative or judicial review could be conducted of
the determination of the base operating DRG amounts; the
methodology for determining the adjustment factor and its
various components (excess readmissions ratio, aggregate
payments for excess readmissions and aggregate payments for all
discharges, applicable conditions, and applicable periods);
measures of readmissions; the determination of a targeted
hospital for additional DSH payments, the increase in DSH
payments, the aggregate DSH cap, the hospital-specific DSH
limit, and the form of DSH payment.
Application to Critical Access Hospitals (CAHs). CAHs would
receive reduced payments for preventable hospital readmissions
starting for cost reporting periods beginning in FY2012 and in
subsequent fiscal years. The adjustment factor for acute care
hospitals would be applied. The methodology for determining the
adjustment factor, including the determination of aggregate
payments for actual and expected readmissions, applicable
periods, applicable conditions, and measures of readmission
would not be subject to administrative or judicial review.
Application to Post-Acute Care Providers. The proposal
would also reduce Medicare payments on claims from post-acute
care providers (skilled nursing facilities, inpatient
rehabilitation facilities, home health agencies, and long-term
care hospitals) for patients readmitted to an applicable
hospital or a CAH within 30 days of an initial discharge from a
hospital or a CAH. Payments to post-acute providers would be
reduced by 0.996 for the fiscal year or rate year 2012; 0.993
for the fiscal or rate year 2013; and 0.99 for fiscal or rate
year 2014. This policy would apply to the discharges or
services furnished on or after the first day of the fiscal or
rate year, beginning on or after October 1, 2011.
The Secretary would be required to develop appropriate
measures of readmissions rates for post-acute care providers
and to submit such measures for endorsement through a
consensus-based entity, such as the National Quality Forum. The
Secretary would be required to adopt, expand, and apply such
measures, in the same manner as for applicable hospitals
established earlier in the legislation. To the extent such
measures would be adopted, the Secretary would adopt similar
payment policies for post-acute providers on or after October
1, 2014, that have been established for applicable hospitals
and CAHs. Post-acute providers would also be subject to the
monitoring and penalties established for applicable hospitals
and CAHs elsewhere in this legislation.
Physicians. The Secretary would be required to conduct a
study to determine how this readmissions policy could be
applied to physicians and issue a public report no later than
one year after enactment. Such approaches would be required to
be considered: (1) creating a code (or codes) and budget
neutral payment amount(s) under the fee schedule for services
furnished by an appropriate physician who sees an individual
within the first week after discharge from a hospital or CAH;
(2) developing measures of readmissions rates for individuals
treated by physicians; (3) applying a payment reduction for
physicians who treat the patient during the initial admissions
that results in a readmission; and (4) methods for attributing
payments or payment reductions to the appropriate physician or
physicians.
Funding. In addition to funds otherwise available, out of
any funds in the Treasury not otherwise appropriated, there
would be appropriated, to the CMS Program Management Account,
$25 million for each fiscal year beginning with 2010. Amounts
appropriated for a fiscal year would be required to be
available until expended.
Sec. 1152. Post-acute care services payment reform plan and bundling
pilot program
Current Law
Medicare pays for most post-acute care (PAC) services,
including skilled nursing facilities (SNF), long-term care
hospitals (LTCH), inpatient rehabilitation facilities (IRF),
and home health, under prospective payment systems (PPS)
established for each type of provider. Under each PPS, a
predetermined rate is paid for each unit of service, such as a
hospital discharge, or a payment classification group. As some
Medicare beneficiaries with complex health conditions and
multiple co-morbidities move between hospital stays and a range
of PAC providers, Medicare makes separate payments to each
provider for covered services. Payments across PAC settings may
differ considerably even though the clinical characteristics of
the patient and the services delivered may be very similar.
The Deficit Reduction Act of 2005 (P.L. 109-171) required
the Centers for Medicare and Medicaid Services (CMS) to develop
a Post-Acute Care Payment Reform Demonstration (PAC
demonstration). The goal of this initiative is to standardize
patient assessment information from PAC settings and to use
these data to guide payment policy in the Medicare program.
This demonstration began in 2008 and a report is expected to be
submitted to Congress by the Secretary in 2011. CMS has also
established a 3-year Acute Care Episode (ACE) Demonstration to
test the effects of using a bundled payment for inpatient
hospital and physician services for a set of 9 orthopedic and
28 cardiovascular conditions. There are 5 participants in the
ACE demonstration, which began early in 2009.
The Medicare Payment Advisory Commission (MedPAC), among
others, has expressed concern that providers do not have
financial incentives to coordinate across episodes of care nor
to evaluate the full spectrum of care a patient may receive. In
its June 2008 report, MedPAC recommended that a bundled payment
system for an episode of care be explored in a pilot program.
Under this voluntary program, a single provider entity would
receive a bundled payment intended to cover the costs of the
full range of care needed over the hospitalization episode,
including 30 days post-discharge. MedPAC recommended that the
pilot program should have clearly established guidelines for
determining whether it should be discontinued or expanded to
the entire Medicare program
Proposed Law
Fee-for-service payment systems reward high patient and
procedure volume and do not encourage care coordination
delivered across an episode of care. Ideally, the payment
system should incentivize hospitals, post-acute institutions,
and physicians to collaborate in coordinating care for Medicare
beneficiaries and to work efficiently together.
Currently, hospitals are paid in a single amount based on
the patient's diagnosis to cover all hospital costs associated
with the stay except for physician services. Surgeons are paid
a bundled fee called a global surgical fee that includes the
post-surgical follow up visits. MedPAC suggests that while
these payment innovations may have improved providers'
efficiency (e.g., shorter length of stay) during the episode of
care, they apply to only one provider and therefore have a
limited effect in reducing the aggregate volume of services
paid for by Medicare.
Health policy experts have recommended that under a bundled
payment structure, Medicare would pay a single provider entity
an amount intended to cover the costs of providing a full range
of care needed over a hospitalization episode that would
include the acute care and the post-acute care setting.
However, a bundled payment system has significant implications
for the future delivery of care for Medicare beneficiaries.
Such a broad policy change requires significant research and
planning to implement in order to protect the quality of care
received by beneficiaries and the integrity of the program.
The Secretary would be required to develop a detailed plan
to reform payment for Medicare's PAC services, including
specifications for a bundled payment to improve their
coordination, quality, and efficiency, and to improve outcomes
for individuals. For this plan, PAC services would include
those services provided by SNFs, IRFs, LTCHs, hospital based
outpatient rehabilitation facilities, and home health agencies
to individuals after discharge from a hospital and such other
services as determined appropriate by the Secretary.
The plan would be required to include consideration of the
following issues: (1) the nature of payments under a PAC
bundle, including the type of provider or entity to whom
payment should be made, the scope of activities and services
included in the bundle, whether payment for physicians'
services would be included, and the period covered by the
bundle; (2) whether the payment should be consolidated with the
payment under the inpatient prospective system or a separate
payment established for such bundle, and if a separate payment
is established, whether it should be made only upon use of PAC
services or for every discharge; (3) whether the bundle should
be applied across all categories of providers of inpatient
services and PAC services or whether it should be limited to
certain categories of providers, services, or discharges, such
as high volume or high cost MS-DRGs; (4) the extent to which
payment rates could be established to achieve offsets for
efficiencies that could be expected to be achieved with a
bundled payment, whether such rates should be established on a
national basis or for different geographic areas, whether such
rates should vary according to discharge, case mix, outliers,
and geographic differences; (5) the nature of protections
needed for individuals under a system of bundled payments to
ensure that individuals receive quality care, are furnished the
level and amount of services needed, as determined by an
appropriate assessment instrument, and the extent to which
transitional care services would improve quality of care for
individuals and the functioning of a bundled post-acute system;
(6) the nature of relationships that may be required between
hospitals and providers of PAC services to facilitate bundled
payments, including the application of gainsharing, anti-
referral, anti-kickback, and anti-trust laws; (7) quality
measures that would be appropriate for reporting by hospitals
and post-acute providers; (8) how cost-sharing for a PAC bundle
should be treated relative to current rules for cost-sharing
for inpatient hospital, home health, skilled nursing facility,
and other services; (9) how other programmatic issues should be
treated in a PAC bundle; and (10) such other issues as the
Secretary would deem appropriate.
In the development of this plan, the Secretary would be
required to consult relevant stakeholders and to consider
experience with such research studies and demonstrations that
the Secretary determines appropriate. In addition, the
Secretary would be required to analyze the impacts (including
geographic impacts) of PAC reform approaches, including the
effect on beneficiaries, hospitals, PAC providers, and
physicians; use existing data (such as data submitted on
claims) and collect such data as the Secretary would determine
appropriate; and if patient functional status measures are
appropriate for the analysis, to the extent practical, build
upon the Continuity Assessment Record and Evaluation (CARE)
tool being developed to measure the health and functional
status of Medicare acute discharges and changes in severity and
other outcomes for Medicare PAC patients under CMS' PAC
demonstration plan.
Out of any funds in the Treasury not otherwise
appropriated, there would be appropriated to the Secretary for
the CMS Program Management Account $15 million for each of the
fiscal years 2010 through 2012. These amounts appropriated for
the fiscal years would be available until expended.
The Secretary would be required to issue interim public
reports on a periodic basis and, not later than 3 years after
enactment, issue a final public report on this plan and its
impact.
Conversion of Acute Care Episode Demonstration to Pilot
Program and Expansion to Include Post-Acute Services. This
provision would require the Secretary, by no later than January
1, 2011, and for the purpose of promoting bundled payments to
promote efficient and high quality delivery of care, to convert
the acute care episode demonstration into a pilot program and
expand it to include post-acute services and such other
services the Secretary determines to be appropriate (which may
include transitional services).
The Secretary would be required to set specific goals for
the number of acute and post-acute bundling test sites under
the pilot program to ensure that it is of sufficient size and
scope to: (1) test the approaches under the pilot program in a
variety of settings, including urban, rural, and underserved
areas; (2) include geographic areas and additional conditions
that account for significant program spending, as defined by
the Secretary; and (3) disseminate the pilot program rapidly on
a national basis if appropriate. To the extent that the
Secretary finds the inpatient and post-acute care bundling to
be successful in improving quality and reducing costs, the
Secretary would be required to implement such mechanisms and
reforms under the pilot program on as large a geographic scale
as practical and economical. The Secretary would be required to
only expand the pilot program if the CMS' Chief Actuary
certifies that the demonstration and pilot programs maintain or
increase the quality of care received by individuals and such
demonstration program and that the pilot program reduces
program expenditures. Participation in this pilot program would
be voluntary.
Sec. 1153. Home health payment update for 2010
Current Law
Home health agencies (HHAs) are paid under a prospective
payment system (PPS) that began on October 1, 2000. Payment is
based on 60-day episodes of care for beneficiaries, subject to
several adjustments, with unlimited episodes of care in a year.
The payment covers skilled nursing, therapy, medical social
services, aide visits, medical supplies, and other services.
Durable medical equipment is not included in the home health
PPS. The base payment amount, or national standardized 60-day
episode rate, is increased annually by an update factor that is
determined, in part, by the projected increase in the home
health market basket (MB) index. This index measures changes in
the costs of goods and services purchased by HHAs. Since 2007,
HHAs are required to submit to the Secretary health care
quality data. An HHA that does not submit the required quality
data will receive an update of the MB minus two percentage
points. This reduction only applies to the payment year in
question.
Proposed Law
This section implements a MedPAC recommendation to maintain
payment rates for home health agencies (HHAs) for CY2010 at
their levels in 2009. Home health agencies would still be
subject to the data quality provision for subsequent years.
Sec. 1154. Payment adjustments for home health care
Current Law
Home health agencies (HHAs) are paid under a prospective
payment system (PPS) that began on October 1, 2000. Payment is
based on 60-day episodes of care for beneficiaries, subject to
several adjustments, with unlimited episodes of care in a year.
The payment covers skilled nursing, therapy, medical social
services, aide visits, medical supplies, and other services.
Durable medical equipment is not included in the home health
PPS. The base payment amount, or national standardized 60-day
episode rate, is increased annually by an update factor that is
determined, in part, by the projected increase in the home
health market basket (MB) index. This index measures changes in
the costs of goods and services purchased by HHAs. Since 2007,
HHAs are required to submit to the Secretary health care
quality data. An HHA that does not submit the required quality
data will receive an update of the MB minus two percentage
points. This reduction only applies to the payment year in
question.
In calendar year (CY) 2008, CMS made refinements to the
home health (HH) PPS. These refinements included a reduction in
the national standardized 60-day episode payment rate, phased-
in over 4 years, to account for changes in case mix that are
not related to HH patients' actual clinical conditions; changes
to the case-mix model to account differently for comorbidities
and the differing health characteristics of longer-stay
patients, including increasing the number of HH resource groups
from 80 to 153; changes to the way the PPS accounts for the
impact of rehabilitation services on resource use to reduce the
impact of financial incentives on the delivery of therapy
visits; and an increased payment for low utilization payment
adjustment (LUPA) episodes that occur as the only episode or
the first episode during a period of HH; and other changes.
These refinements resulted in payment changes described in
Federal Regulation Sec. 484.220 issued on Aug. 29, 2007 (72 FR
49879).
This regulation established changes to the HHA case-mix
index to account for the relative resource utilization of
different patients. These changes modified the coding or
classification of different units of service that do not
reflect real changes in case-mix. As a result, the national
prospective 60-day episode payment rate was adjusted downward
by 2.75% for CY2008-2010; then by 2.71% for CY2011.
Proposed Law
Pursuant to a MedPAC recommendation, the provision would
accelerate the case-mix adjustments described in 42 FR
Sec. 484.220 by implementing both the planned CY2011 adjustment
of 2.71% and the planned CY2010 adjustment of 2.75% at the same
time in CY2010, for a total FY2010 downward adjustment of
5.46%. The amounts of these adjustments would not be limited if
more recent data were to indicate that a greater adjustment
would be appropriate.
One source of Medicare overpayments to HHAs is the use of
outdated data in payment rates. The prospective payment system
for home health services developed in 1998 is based on agencies
providing an average of 32 visits per 60-day episode. However,
since that time, the number of visits per episode has dropped
by 30 percent, to an average of 22 visits. This provision
incorporates those changes into the payment system.
Starting in 2011, HH prospective payment amounts would be
adjusted by a uniform percentage determined appropriate by the
Secretary and based on analysis of factors such as changes in
the average number and types of visits in an episode since the
implementation of the PPS, changes in the intensity of visits
in an episode, growth in cost per episodes, and other factors
that the Secretary would consider to be relevant. For years
after 2011, such amounts would be required to be equal to the
amount paid for the previous year updated by the HH market
basket.
If the Secretary is not able to compute the changed
prospective payment amounts for 2011 on a timely basis, then
the Secretary would be required to pay 95% of what the
prospective payment amount would have been had this provision
not applied. And, under such circumstances, the Secretary would
be required to compare, before July 1, 2011, amounts paid to
the amount that would have been paid had the Secretary been
able to compute the adjustment on a timely basis. For 2012, the
Secretary would be required to decrease or increase the
prospective payment amount (or at the Secretary's discretion,
over a period of several years beginning with 2012), by the
amount (if any) by which the amount applied is greater or less,
respectively, than the amount that should have been applied.
Sec. 1155. Incorporating productivity improvements into market basket
update for home health services
Current Law
Home health agencies (HHAs) are paid under a prospective
payment system (PPS) that began on October 1, 2000. Payment is
based on 60-day episodes of care for beneficiaries, subject to
several adjustments, with unlimited episodes of care in a year.
The payment covers skilled nursing, therapy, medical social
services, aide visits, medical supplies, and other services.
Durable medical equipment is not included in the home health
PPS. The base payment amount, or national standardized 60-day
episode rate, is increased annually by an update factor that is
determined, in part, by the projected increase in the home
health market basket (MB) index. This index measures changes in
the costs of goods and services purchased by HHAs. Since 2007,
HHAs are required to submit to the Secretary health care
quality data. A HHA that does not submit the required quality
data will receive an update of the MB minus two percentage
points. This reduction only applies to the payment year in
question.
Each year, the Medicare Payment Advisory Commission
(MedPAC) makes payment update recommendations for the different
payment systems. In its view, Medicare's payment systems should
encourage efficiency: providers should be able to reduce the
quantity of inputs to produce a unit of service while
maintaining quality. Accordingly, MedPAC begins its update
deliberations with an assumption that all providers can achieve
efficiency gains similar to the economy and examines the Bureau
of Labor Statistics' estimate of the 10-year moving average
rate of past growth in total factor productivity for the
economy as a whole. This policy target links Medicare's
expectations for efficiency improvements to the productivity
gains achieved by firms and workers who pay taxes that fund
Medicare. MedPAC's annual update recommendation depends on its
overall assessment of the circumstances of a given set of
providers in any year.
Proposed Law
The annual update to the Medicare physician fee schedule
already incorporates adjustments for gains in productivity.
This provision creates uniformity across Medicare providers by
creating a productivity adjustment for home health agencies.
This adjustment will encourage greater efficiency in health
care provision, hold Medicare providers accountable for
achieving productivity gains on par with the overall economy,
and more accurately align Medicare payments with provider
costs.
The provision would make annual updates by the HH MB
subject to a productivity adjustment as long as the annual
update would not be less than zero. The productivity adjustment
would equal the 10-year moving average of changes in annual
economy-wide private non-farm business multi-factor
productivity. The estimate used would be that published before
the promulgation of the regulation establishing the Medicare
rates for the year or period. This provision would be required
to apply to home health market basket percentage increases for
years beginning with 2010.
Sec. 1156. Limitation on Medicare exception to the prohibition on
certain physician referrals for hospitals
Current Law
Physicians are generally prohibited from referring Medicare
patients for certain services to facilities in which they (or
their immediate family members) have financial interests.
However, among other exceptions, physicians are not prohibited
from referring patients to hospitals in which they have
ownership or investment interests that include the hospital's
entire business (the so-called whole hospital exception).
Providers that furnish substantially all of its designated
health services to individuals residing in rural areas are
exempt as well.
Entities receiving Medicare payment for covered items and
services are required to provide the information on the
entities' ownership, investment, and compensation arrangements.
This information includes the covered items and services
provided by the entity, and the names and unique physician
identification numbers of all physicians (or those whose
immediate relatives) who have an ownership or investment
interest, or certain compensation arrangements.
Proposed Law
The provision prohibits new physician-owned hospitals from
participating in Medicare. The provision addresses concerns
about the strong incentive self-referral exerts on physician
decision-making and the potential negative implications of that
conflict of interest for patient safety and the volume of
services in Medicare.
Under this provision, only hospitals meeting certain
requirements would be exempt from the prohibition on self-
referral. Hospitals (including rural providers) that have
physician ownership and a provider agreement in operation on
January 1, 2009, and that meet other specified reporting and
disclosure requirements would be exempt from this self-referral
ban. Hospitals would be allowed to maintain the percentage of
the total ownership or investment held in the hospital (or in
an entity whose assets include the hospital) by physician
owners or investors in the aggregate at the level that existed
as of date of enactment. Hospitals would be allowed to expand
the number of operating rooms, procedure rooms, or beds of the
hospital if certain criteria are met. The exempted hospital
could not have converted from an ambulatory surgical center to
a hospital after enactment.
To qualify for the exemption, entities receiving Medicare
payment for covered items and services would be required to
provide the information on the entities' ownership, investment,
and compensation arrangements. This information includes the
covered items and services provided by the entity, and the
names and unique physician identification numbers of all
physicians (or those with immediate relatives) who have an
ownership or investment interest, or certain compensation
arrangements. Such information would be provided in the form,
manner, and at such times as specified. This requirement would
not apply to designated health services provided outside of the
United States or to entities deemed to provide services
infrequently paid by Medicare.
An exempt entity would also be (1) required to submit an
initial report and periodic updates at specified intervals that
contained a detailed description of the identity of each
physician owner and investor as well as any other owners and
investors in the hospital; and any other information on the
nature and extent of all ownership interests in the hospital;
(2) required to provide to all patients a disclosure relating
to any referring physician owner's ownership interest in the
hospital and, if applicable, any such ownership interest of the
treating physician (by a time that permits the patient to make
a meaningful decision regarding the receipt of care) ; and (3)
required to disclose the fact that the hospital is partially or
wholly owned by one or more physician investors on any public
website for the hospital and in any public advertising for the
hospital. This requirement would not apply to designated health
services provided outside of the United States or to entities
deemed to provide services infrequently paid by Medicare.
Information provided by hospitals would be published and
periodically updated on the Internet website of the Centers for
Medicare and Medicaid Services (CMS). Any person who fails to
meet required reporting and disclosure requirements are subject
to a civil monetary penalty of not more than $10,000 for each
day for which reporting is required to have been made or for
each case in which disclosure is required to have been made.
Exempt hospitals would ensure bona fide ownership and
investment by meeting the following requirements: (1) any
ownership or investment interest offered to a physician could
not be offered on more favorable terms than those offered to a
person who is not in a position to refer patients or otherwise
generate hospital business; (2) the hospital (or investors in
the hospital) could not directly or indirectly provide loans or
financing for physician owners or investors in the hospital;
(3) the hospital or its investors could not guarantee a loan,
make a payment toward a loan, or otherwise subsidize a loan to
any individual physician owner, investor, group of physician
owners or investors that is related to acquiring an ownership
or investment interest in the hospital; (4) ownership or
investment returns must be distributed to investors in the
hospital in an amount that is directly proportional to the
investment or ownership by the hospital investor; (5) the
investment interest of the owner or investor is directly
proportional to the capital contributions made at the time the
ownership or investment interest is obtained; (6) physician
owners and investors do not receive any guaranteed receipt or
right to purchase other business related interests in the
hospital, including the purchase or lease of any property under
the control of other investors in the hospital or located near
the premises of the hospital; (7) the hospital does not offer a
physician owner the opportunity to purchase or lease any
property under hospital control on more favorable terms than
those offered to others and (8) the hospital does not condition
any physician ownership or investment interests on the
physician making or influencing referrals to the hospital or
generating business for the hospital.
To ensure patient safety, those exempt hospitals that do
not offer emergency services would have to have the capacity to
(1) provide assessment and initial treatment for medical
emergencies; and (2) refer and transfer the patient with the
medical emergency to the hospital with the required capability
if it lacks the capabilities to treat the involved emergency.
Those hospitals that do not have any physician available on the
premises 24 hours per day, 7 days a week must disclose such
fact to the patient before admitting the patient. Following
such a disclosure, the hospital would receive a signed
acknowledgement from the patient that the patient understands
that fact. The Secretary would retain the ability to terminate
a hospital's provider agreement if the hospital is not in
compliance with Medicare's conditions of participation.
Exempt hospitals would be permitted to increase the number
of operating rooms, procedure rooms or beds after the date of
enactment under certain criteria. A procedure room includes a
room in which catheterizations, angiographies, angiograms, and
endoscopies are furnished. This would not include emergency
rooms or departments (except for rooms in which
catheterizations, angiographies, angiograms, and endoscopies
are furnished). Hospitals meeting certain criteria would be
allowed to expand, with these criteria including (1) a hospital
that is located in a county where the population increased
during the most recent 5-year period at a rate that is at least
150% of the state's population increase; (2) a hospital whose
Medicaid inpatient admission percentage is equal to or greater
than the average percentage for all hospitals located in the
county; (3) a hospital that does not discriminate against
beneficiaries of federal health care programs and does not
permit physicians practicing at the hospital to discriminate
against such beneficiaries; (4) a hospital that is located in a
state with an average bed capacity less than the national
average; (5) a hospital that has an average bed occupancy rate
that is greater than the state average bed occupancy rate; and
(6) meets other established requirements.
This capacity increase would be limited to facilities on
the main campus of the hospital and could not exceed 200% of
the number of operating rooms, procedure rooms and beds at the
time of enactment. Any increase would only be permitted in
facilities on the main campus of the hospital. The process for
expansion should allow the opportunity for community input and
should permit an applicable hospital to apply for the expansion
exception up to once every two years. The Secretary would be
required to promulgate regulations establishing the appeal
process no later than the first day of the month beginning 18
months after the date of enactment. The appeal process would be
implemented one month after the date of regulations are
promulgated. These regulations would be able to be issued as
interim final regulations. The final decision regarding an
expansion request will be posted on the CMS website no later
than 120 days after a complete application is received. There
shall be no administrative or judicial review of this process.
The Secretary would be required to establish policies and
procedures to ensure compliance with these requirements. The
enforcement efforts may include unannounced site reviews of
hospitals. In addition to funds otherwise available, starting
in FY2010, $5 million would be appropriated in each fiscal year
from not otherwise appropriated funds in the Treasury for
purposes of carrying out this section. Appropriated funds would
be available until expended. Certain federal laws with respect
to the coordination of federal information policy established
by Chapter 35 of Title 44 of the United States Code would not
apply to these requirements.
Sec. 1157. Institute of Medicine study of geographic adjustment factors
under Medicare
Current Law
Generally, Medicare's payment systems include adjustment
factors to account for the geographic differences in the costs
of providing health care services. For example, Medicare's
physician fee schedule (which with modifications is used to
reimburse other health care practitioners in Medicare) uses the
geographic practice cost index (GPCI) for this purpose;
Medicare's inpatient prospective payment system (IPPS) uses a
hospital wage index to adjust payments for acute care
hospitals. With modifications, the IPPS wage index is used to
calculate payments for inpatient rehabilitation hospitals,
inpatient psychiatric hospitals, long term care hospitals,
skilled nursing facilities, and home health agencies.
Proposed Law
This provision addresses concerns that have been raised
about the methodology and data used to geographically adjust
Medicare payment rates.
The Secretary would enter into a contract with the
Institutes of Medicine (IOM) of the National Academies to
conduct a comprehensive empirical study with appropriate
recommendations on the accuracy of the geographic adjustment
factors established for Medicare's physician fee schedule and
for Medicare's IPPS. The study would include an evaluation of
the empirical validity of the adjustments; methodology used to
determine the adjustments, and measures used for the
adjustments. The latter would take into account the timeliness
of the data and frequency of data revisions; data sources and
validity, and operational costs of participating providers. The
study would also examine the effect of the adjustment factors
on the level and distribution of the health workforce within
the United States. This would include recruitment and retention
accounting for workforce mobility between urban and rural
areas; ability of hospital and other facilities to maintain an
adequate and skilled workforce; patient access to providers and
needed medical technology. The study would also examine the
effect of the adjustment factors on population health and
quality of care and the ability of providers to furnish
efficient, high value care. The IOM report would be submitted
to the Secretary and to Congress no later than one year from
enactment. Necessary funds would be authorized to be
appropriated to carry out this study.
Sec. 1158. Revision of Medicare payment systems to address geographic
inequities
Current Law
Generally, Medicare's payment systems include adjustment
factors to account for the geographic differences in the costs
of providing health care services. Section 1157 requires the
IOM to conduct a study of the geographic practice cost index
(GPCI) used to adjust Medicare's physician fee schedule and the
hospital wage index used in Medicare's inpatient prospective
payment system (IPPS).
Generally, the Centers for Medicare and Medicare Services
promulgates changes to Medicare's physician fee schedule and
IPPS through an annual rulemaking process where proposed
changes and a notice of a public comment period are published
in the Federal Register. Subsequently, a final rule
establishing the payment polices and responding to public
comments is published in the Federal Register. Medicare's IPPS
and physician payments are on different payment years and
therefore rulemaking schedules. Generally the new IPPS payment
rates are effective October 1 of each year and new physician
fee schedule is effective as of January 1 of each year.
Proposed Law
The Secretary would be required to take into account the
IOM recommendations included in the report on the adequacy of
Medicare's geographic adjustments established in the previous
section. Appropriate proposals to revise the respective
geographic adjustments would be included in the proposed rules
applicable to the rulemaking process for Medicare's payments
for physicians' services and IPPS hospitals. The proposals
would be included in the next applicable rulemaking cycle after
submission of the IOM report to the Secretary. The Secretary
would be able to change the geographic adjustments accordingly,
but could not reduce an adjustment below that which applied in
the payment system in the prior payment year. These adjustments
for services furnished before January 1, 2014, could not exceed
the amounts in the Medicare Improvement Fund as amended in this
legislation. No more than half of that $8 billion would be
available in any one payment year.
Subtitle D--Medicare Advantage Reforms
Part 1--Payment and Administration
Sec. 1161. Phase-in of payment based on fee-for-service costs
Current Law
Most Medicare beneficiaries (about 75%) receive their care
through the original Medicare program, often called fee-for-
service Medicare (FFS). Medicare Advantage (MA) is an
alternative way for Medicare beneficiaries to receive covered
benefits. Under MA, private health plans are paid a per-person
amount to provide all Medicare-covered benefits (except
hospice) to beneficiaries who enroll in their plan. Beginning
in 2006, the Secretary began determining MA payment rates by
comparing plan bids to a benchmark. Each bid represents the
plan's estimated revenue requirement for providing required
Parts A and B Medicare services to an average Medicare
beneficiary. The benchmark amounts represent the maximum amount
the federal government will pay a plan for providing required
Medicare benefits. If a plan's bid is less than the benchmark,
its payment equals its bid plus a rebate of 75% of the
difference between the benchmark and the bid. The rebate must
be used to provide additional benefits, reduce enrollees'
Medicare cost sharing expenses, or reduce enrollees' monthly
Part B, Part D, or supplemental premiums (for services beyond
required Medicare benefits). The remaining 25% of the
difference is retained by the federal government. If a plan's
bid is equal to or above the benchmark, its payment is equal to
the benchmark amount, and each enrollee in that plan will pay
an additional premium equal to the amount by which the bid
exceeds the benchmark.
In general, the MA benchmarks in each local area (county)
are updated annually by the overall growth in Medicare
expenditures, otherwise known as the National MA Growth
Percentage. In certain years (known as rebasing years), plan
payments are updated by the greater of the growth percentage or
100% of fee-for-service (FFS) costs, with adjustments.
Beginning in 2010, the benchmarks will be adjusted to phase-out
the value of indirect medical education costs. Payments for the
indirect costs of medical education will continue to be made
directly to hospitals.
MA benchmarks are based, in part, on historical Medicare
private plan payment rates. The Balanced Budget Act of 1997
(P.L. 105-33, BBA) increased payments to private plans above
rates of per person FFS costs in some areas. Subsequent
legislation also increased payment rates to private plans. The
historical payment rates were used as the basis for the
benchmark amounts, as specified in the Medicare Prescription
Drug, Improvements, and Modernization Act of 2003, (P.L. 108-
173, MMA). As a result, current MA benchmarks exceed per capita
FFS costs in virtually all areas, in some cases substantially.
Proposed Law
Private plans were initially included in the Medicare
program to test whether managed care would improve efficiency
and innovation and reduce costs, especially in parts of the
county where traditional, or fee-for-service (FFS), Medicare
was an inefficient purchaser. Reflecting this goal, Medicare
Health Maintenance Organizations were originally paid at 95
percent of the average adjusted per capita costs (AAPCC) in
fee-for-service Medicare at the county level. New Medicare
policies enacted in 1997, 2000 and 2003 now result in
overpayments to Medicare Advantage (MA) plans. MedPAC estimates
that, on average, payments to plans were 14% higher than costs
in fee-for-service Medicare, on average.
Starting in 2011, the provision would phase-in MA payment
based on per person FFS spending each county. Starting 2013, MA
benchmarks would be equal to per capita FFS spending in each
county. In no event would a benchmark be less than per capita
FFS spending. This provision would not apply to Programs of
All-Inclusive Care for the Elderly (PACE). Phasing MA payments
down to FFS costs in each county over three years gives MA
plans time to adjust, if necessary, to the new payment rates.
The phase-down of MA payments to FFS costs applies equally
to all 50 states and the territories; however, Puerto Rico is a
unique situation that the Committee expects that the Secretary
will use authority under current law to examine. Specifically,
very few Medicare beneficiaries in Puerto Rico choose to enroll
in Part B; instead, MA plans buy down the Part B premium for
enrollees and therefore many Medicare beneficiaries enroll in
MA to receive all of their Medicare services. With only a small
population enrolled in Part B through traditional Medicare, the
county FFS expenditures calculated by the Secretary are low and
unstable from year-to-year. Therefore, the Committee expects
that when calculating county FFS rates for Puerto Rico, the
Secretary will use utilization and expenditure data from MA
plans under current authority and adjust these rates and risk
scores appropriately.
Sec. 1162. Quality bonus payments
Current Law
Payments to MA plans are not contingent on the quality of
care provided to Medicare beneficiaries. However, all MA
organizations are required to have a quality improvement
program before January 1, 2010. As part of the quality
improvement program, plans must collect, analyze, and report
data to measure health outcomes and other indices. Plans are
also required to report quality data to CMS, with some
exceptions.
The Medicare Improvements for Patients and Providers Act of
2008 (P.L. 110-275, MIPPA) required for Medicare Payment
Advisory Commission (MedPAC) to conduct a study on how
comparable quality measures of performance and patient
experience can be collected and reported by 2011 for MA and
original Medicare. The report is to be submitted to Congress
not later than March 31, 2010.
Payments to MA plans are determined by comparing plan bids
to a benchmark. Each bid represents the plan's estimated
revenue requirement for providing required Medicare services to
an average Medicare beneficiary. The benchmark is the maximum
amount Medicare will pay a plan. If the plan bid is below the
benchmark, the plan payment is the bid plus 75% of the
difference between the bid and the benchmark. If the bid is
above the benchmark, the plan payment is equal to the benchmark
and each plan enrollee must pay a premium equal to the
difference between the bid and the benchmark.
Proposed Law
This provision creates a pay-for-quality program in
Medicare Advantage. Today, plans that deliver poor quality care
are paid as much as plans that provide high quality care. This
situation provides no incentive for plans to focus on improving
the quality of care received by their enrollees. By changing
the payment incentives facing plans this provision will drive
Medicare Advantage plans to focus on providing services that
improve the health of their enrollees.
For plan years starting with 2011, MA plans identified as
high quality plans or improved quality plans would receive an
increase in their benchmark amounts. For high quality plans,
the increase would be 1% in 2011, 2% in 2012 and 3% in
subsequent years. For improved quality plans, the increase
would be 0.33% in 2011, 0.66% in 2012, and 1% in subsequent
years.
The Secretary would be required to compute a quality
performance score for each MA plan for each year beginning in
2010. The calculation of quality scores for MA plans would
change over time. For years before 2014, the quality score
would be equal to a blend (as designated by the Secretary) of
the plan's Healthcare Effectiveness Data and Information Set
(HEDIS) scores, Consumer Assessment of Health Care Providers
and Systems (CAHPS) scores, and such other measures of clinical
quality as the Secretary specifies. The measures would be risk-
adjusted as deemed appropriate by the Secretary. By 2013, the
Secretary would be required to implement new reporting
requirements for quality measures that reflect the outcomes of
care experienced by MA enrollees. These measures may include
(a) measures of rates of admission and readmission to a
hospital, (b) measures of prevention quality, such as those
established by the Agency for Healthcare Research and Quality,
(c) measures of patient mortality and morbidity following
surgery, (d) measures of health functioning such as limitations
on activities of daily living and survival for patients with
chronic diseases, (e) measures of patient safety, and (f) other
measures as determined by the Secretary. The measures would be
risk-adjusted as the Secretary deemed appropriate. In
determining the quality measures to be used, the Secretary
would be required to consider the MedPAC recommendations
presented in their report to Congress mandated under MIPPA. The
Secretary would be required to provide preferential
consideration to measures of quality collected on, or
comparable to measures of quality under Medicare Parts A and B.
The Secretary would be required to follow specified rules for
selection of quality measures. Specifically, the Secretary
would be required to provide preference to clinical quality
measures that have been endorsed by a consensus-based entity
under contract with the Secretary. The Secretary would also be
required to publish the measures in the Federal Register and
provide for public comment on those measures prior to their
selection. For 2014 and 2015, the Secretary would have the
authority to compute quality performance scores based on a
blend of the HEDIS/CAHPS scores and the new quality reporting
measures. For years beginning in 2016, the preponderance of
measures used to calculate MA plan quality would be required to
be the new quality reporting measures.
The provision would specify which year's data would be used
to calculate quality measures. For payments in 2011, quality
measure data for 2009 would be used. Starting in 2012, payments
would be based on quality measures for the second preceding
year. Each MA organization would be required to report quality
data to the Secretary for the determination of quality
performance scores under this part, in a time and manner
specified by the Secretary.
Based on the quality performance scores, each plan would be
ranked to determine which are ``high quality MA plans'' and
``improved quality MA plans'' and thus receive the
corresponding benchmark increases. The Secretary would be
required to rank plans from highest to lowest based on absolute
scores and projected enrollment, and from highest to lowest
based on percentage improvement in score and projected
enrollment for the plan from the previous year. A plan which
does not report quality data would be counted as having the
lowest plan performance and lowest percentage improvement.
Based on the quality performance scores, and the estimated
proportion of enrollment, the Secretary would be required to
identify the MA plans with the highest scores that are
projected to include 20 percent of the aggregate projected
enrollment for the year. These plans will be identified as
``high quality MA plans.'' The same methodology would be used
to determine ``improved quality MA plans.'' Starting in 2011,
the Secretary would be required to notify ``high quality
plans'' and ``improved quality plans'' of their status and the
corresponding payment adjustment for the year. The Secretary is
to notify these plans through the annual announcement of
benchmark rates and through publication on the website for the
Medicare program. The Secretary would be given the authority to
disqualify an MA plan from receiving a quality bonus if the
Secretary identifies deficiencies in the plan's compliance with
rules under this part.
Sec. 1163. Extension of secretarial coding intensity adjustment
authority
Current Law
In general, Medicare payments to MA plans are risk-adjusted
to account for the variation in the cost of providing care to
enrollees of varying health status. Risk adjustment is designed
to compensate plans for the increased cost of treating older
and sicker beneficiaries, and thus discourage plans from
preferential enrollment of healthier individuals. The Medicare
risk adjustment models take into account the variation in
expected medical expenditures of the Medicare population
associated with demographic characteristics (age, sex, current
Medicaid eligibility, original Medicare eligibility due to a
disability), as well as medical diagnoses. The Deficit
Reduction Act of 2005 (P.L. 109-171, DRA) required the
Secretary, when risk adjusting payments to MA plans during
2008, 2009, and 2010, to adjust for patterns of diagnosis
coding differences between MA plans and providers under parts A
and B of Medicare, to the extent that the Secretary identified
such differences based on an analysis of data submitted for
2004 and subsequent years.
Proposed Law
This provision would allow CMS to continue making
appropriate adjustments to Medicare Advantage payments to
account for any ``upcoding'' identified by the agency.
Sec. 1164. Simplification of annual beneficiary election periods
Current Law
Medicare beneficiaries may enroll in or change their
enrollment in MA from November 15 to December 31 each year (the
annual, coordinated election period). Changes go into effect on
January 1 of the next year. During the first three months of
the year, beneficiaries can enroll in an MA plan, and
individuals enrolled in an MA plan can either switch to a
different MA plan or return to original Medicare. This period
is known as the continuous open enrollment and disenrollment
period. However, during the three-month period, beneficiaries
cannot change their drug coverage but can change prescription
drug plans.
Proposed Law
The current annual election period, from November 15
through December 31, gives MA and Part D plans very little, if
any, time to process enrollment requests and ensure that on
January 1, each beneficiary is properly enrolled in the plan.
Allowing for a two-week processing period between the end of
the annual election period and the start of the plan year
better ensures that enrollees do not experience any gaps in
coverage, and that plans are able to process enrollments in
time for the start of the plan year.
The provision would move the annual, coordinated election
period to 15 days earlier in the year--November 1 to December
15, rather than from November 15 to December 30. The provision
would also eliminate the continuous open enrollment and
disenrollment period (during the first three months of the
year.) The change would simplify enrollment options so that
beneficiaries select drug plans and the mode of receiving parts
A and B benefits at the same time.
Sec. 1165. Extension of reasonable cost contracts
Current Law
Reasonable Cost plans are MA plans that are reimbursed by
Medicare for the actual cost of providing services to
enrollees. Cost plans were created in the Tax Equity and Fiscal
Responsibility Act (P.L. 97-248, TEFRA) of 1982. The Balanced
Budget Act of 1997 (P.L. 105-33, BBA) included a provision to
phase-out the reasonable cost contracts, however, the phase-out
has been delayed over the years by legislation. These plans are
allowed to operate indefinitely, unless two other plans of the
same type (i.e., either 2 local or 2 regional plans) offered by
different organizations operate for the entire year in the cost
contract's service area. After January 1, 2010, the Secretary
may not extend or renew a reasonable cost contract for a
service area if (1) during the entire previous year there were
either two or more MA regional plans or two or more MA local
plans in the service area offered by different MA
organizations; and (2) these regional or local plans meet
minimum enrollment requirements.
Proposed Law
This provision would extend for two years--from January 1,
2010, to January 1, 2012--the length of time reasonable cost
plans could continue operating regardless of any other MA plans
serving the area. The provision would modify the minimum
enrollment requirement used as one of the criteria the
Secretary considers when determining whether to renew or extend
a reasonable cost plan. The enrollment criteria would apply to
the portion of the MA regional or local plan's service area for
the year that it was within the service area of the reasonable
cost contract (and not the total service area of the MA
regional or local plan).
Sec. 1166. Limitation of waiver authority for employer group plans
Current Law
The Secretary has the authority to waive or modify
requirements that hinder the design of, the offering of, or the
enrollment in employer or union sponsored MA plans. Such plans
can be offered either under contracts between the union or
employer group and a Medicare Advantage organization, or
directly by the employer or union group.
Proposed Law
The MMA gave broad authority to CMS many requirements in
order to encourage employers to provide retiree coverage
through Medicare Advantage. While some requirements of MA plans
marketing in the individual market may not be applicable to
employers contracting with or offering an MA plan, and can
appropriately be waived, it is crucial that retirees enrolling
in such a MA plan have adequate access to a provider network.
Requiring that MA plans offer local plans alongside employer
group plans ensures that they are meeting network adequacy
requirements and enrollees are protected.
For employers or unions that sponsor an MA plan directly
(and not through a contract with a private MA organization),
the Secretary would only have authority to waive or modify MA
requirements for the plan if 90% of eligible individuals
enrolled in the plan live in a county in which the MA
organization offers an MA local plan. This provision would
apply to plan years on or after January 1, 2011. The provision
would not apply to plans in effect as of December 31, 2010.
Sec. 1167. Improving risk adjustment for payments
Current Law
In general, Medicare payments to MA plans are risk-adjusted
to account for the variation in the cost of providing care to
enrollees of varying health status. Risk adjustment is designed
to compensate plans for the increased cost of treating older
and sicker beneficiaries, and thus discourage plans from
preferential enrollment of healthier individuals. The Medicare
risk adjustment models take into account the variation in
expected medical expenditures of the Medicare population
associated with demographic characteristics (age, sex, current
Medicaid eligibility, original Medicare eligibility due to a
disability), as well as medical diagnoses, and differences in
coding practices between MA and providers under Medicare Part A
and B.
Proposed Law
The provision would require the Secretary to continue to
refine the risk adjustment system used for Medicare Advantage
payments to ensure its accuracy with regard to populations with
high health needs, particularly beneficiaries with low incomes
and chronic conditions.
Not later than 1 year after enactment, the Secretary would
be required to submit a report to Congress evaluating the
adequacy of the Medicare Advantage risk adjustment system at
predicting costs for beneficiaries with chronic or co-morbid
conditions, beneficiaries dually-eligible for Medicare and
Medicaid, and non-Medicaid eligible low-income beneficiaries.
The report would be required to also address the need and
feasibility of including further gradations of diseases or
conditions and multiple years of beneficiary data. Taking this
report into account, not later than January 1, 2012, the
Secretary would be required to implement necessary improvements
to the MA risk adjustment system.
Sec. 1168. Elimination of the MA regional plan stabilization fund
Current Law
The MMA created MA regional preferred provider
organizations and established the MA Regional Plan
Stabilization Fund to encourage plans to enter into and/or
remain in the MA Regional Program. The fund was originally set
at $10 billion with additional money added to the fund from
savings in the bidding process. Funds were to be available from
2007 through the end of 2013. Subsequent legislation decreased
the amount of funds available and delayed their availability.
Most recently, MIPPA reduced the initial funding of the program
to one dollar. Money from the regional plan bidding process
continues to flow into the Fund. Expenditures from the Fund are
delayed until 2014.
Proposed Law
Regional PPOs are no longer new products so this fund is no
longer necessary.
The provision would eliminate the MA Regional Plan
Stabilization Fund. Any amounts contained in the Fund would be
transferred to the Federal Supplementary Medical Insurance
Trust Fund.
Sec. 1169. Study regarding the effects of calculating Medicare
Advantage payment rates on a regional average of Medicare fee
for service rates
Current Law
No current law.
Proposed Law
The provision would require the Administrator of the
Centers for Medicare and Medicaid Services to conduct a study
to determine the potential effects of calculating MA rates on a
more aggregated geographic basis, rather than using county
boundaries. The Administrator would be required to consider
whether the alternatives would result in (a) improvements in
quality of care, (b) greater equity among providers, and (c)
more predictable benchmark amounts. In conducting the study,
the Administrator would be required to consult with (a) experts
in health financing, (b) representatives of foundations and
other nonprofit entities that have conducted research on
Medicare financing issues, (c) Medicare Advantage plans, and
(d) such other entities or people as determined by the
Secretary. Not later than one year after the date of enactment,
the Administrator would be required to submit a report to
Congress with a detailed statement of findings and conclusions
of the study, together with recommendations for legislation and
administrative action.
Part 2--Beneficiary Protections and Anti-Fraud
Sec. 1171. Limitation on cost-sharing for individual health services
Current Law
Each MA plan must provide all required Part A and B
Medicare benefits (other than hospice) to individuals entitled
to Medicare Part A and enrolled in Part B. The aggregate amount
of cost sharing in a MA plan must be equal to the aggregate
amount of cost sharing in original Medicare. Cost sharing per
enrollee (excluding premiums) for covered services cannot be
more than the actuarial value of the deductibles, coinsurance,
and co-payments under traditional Medicare.
Dual eligibles are persons also entitled to the full range
of benefits under their state's Medicaid program. Qualified
Medicare beneficiaries (QMBs) are those aged or disabled
individuals that are entitled to have some of their Medicare
cost sharing and Part B premiums paid by the federal-state
Medicaid program, but are not entitled to coverage of Medicaid
services.
Proposed Law
Using a standard of actuarial equivalence across cost
sharing for all services leaves an opportunity for MA plans to
increase cost sharing for infrequently-used services that
enrollees may not scrutinize--like home health or cancer
drugs--while lowering cost sharing for more commonly used
services, like physician visits. While this may be attractive
for enrollees who are relatively healthy, it has potentially
serious out-of-pocket cost implications for those enrollees who
fall sick. MA plans that receive a rebate, because their bid is
below the county benchmark, can use this rebate to lower cost
sharing for certain services, either to attract enrollment or
to encourage use of certain services (e.g. visits to a primary
care physician). Setting a maximum cost sharing that does not
exceed cost sharing under traditional Medicare ensures that no
beneficiary will have higher out-of-pocket costs because they
choose to receive Medicare services through a private plan.
For plan years beginning on or after January 1, 2011, this
provision would prohibit MA plans from offering benefits with
cost sharing requirements that are greater than the cost
sharing requirements imposed under the traditional Medicare
program. The ``actuarially equivalent'' standard in the statute
would be eliminated. Medicare private plans would not be
prohibited from using flat co-payments or per diem rates in
lieu of the cost sharing amounts imposed under Part A and B
Medicare, as long as they did not exceed the level of cost
sharing under traditional Medicare. This provision would also
prohibit plans from imposing cost-sharing for dual-eligible
individuals or qualified Medicare beneficiaries enrolled in a
Medicare MA plan that exceeds the cost-sharing amounts
permitted under the Medicare and Medicaid statutes.
Sec. 1172. Continuous open enrollment for enrollees in plans with
enrollment suspension
Current Law
Special Election Periods (SEPs) allow beneficiaries the
option to discontinue or change their enrollment in a MA plan
outside of the annual coordinated election period. The
circumstances in which an enrollee can exercise this option
include (1) an MA plan terminates its participation in the MA
program or in a specific area, (2) an individual's place of
residence changes, (3) the MA plan violates a provision of its
contract or misrepresents the plan's provisions in marketing
the plan, or (4) other exceptional conditions as provided by
the Secretary.
Proposed Law
This provision would expand the categories of beneficiaries
eligible to participate in a SEP to include beneficiaries
enrolled in private plans that have been suspended for not
meeting the terms of their contract. This provision would
require the Secretary to take into account the health or well-
being of an individual when determining what constitutes
eligibility for a SEP.
Sec. 1173. Information for beneficiaries on MA plan administrative
costs
Current Law
The Secretary must provide for the dissemination of
information to current and prospective Medicare beneficiaries
about MA plans, including, but not limited to benefits, cost
sharing, service areas, access to providers, out-of-area
coverage, emergency coverage, and supplemental benefits.
By the first Monday in June, each local MA plan must submit
to the Secretary an aggregate monthly bid amount (which
includes separate bids for required services, any offered
supplemental benefits, and any offered drug benefits) for each
MA plan it intends to offer in the upcoming calendar year. The
bid is based on the average revenue requirements in the payment
area for an enrollee with a national average risk profile. The
Secretary has the authority to evaluate and negotiate the
plan's bid amounts and its proposed benefit packages.
Proposed Law
This provision would require Medicare Advantage plans to
meet minimal standards of efficiency, consistent with
requirements being placed on qualifying health benefits plans
in the non-Medicare sector under this legislation.
This provision would require the publication of
administrative cost information, including the medical loss
ratio (MLR), for MA plans. Plans that fail to meet a minimum
MLR would be subject to sanctions, such as enrollment
suspension and potential termination.
Beginning in 2011, the Secretary would be required to
publish the MLR for the previous year by November 1 for each MA
plan contract. The definition of MLR would be defined by the
Secretary, taking into account the definition adopted by the
Health Choices Commissioner under Section116 of this Act. Each
MA plan would be required to submit to the Secretary, in a
manner and form specified by the Secretary, the necessary data
for publishing MLR information on a timely basis. For 2010 and
2011, the data submitted would be required to be consistent in
content with the data reported as part of the MA plan bid in
June 2009 for 2010.
For contract years beginning in 2010, the Secretary would
be required to develop and implement standardized elements and
definitions for reporting the data necessary to calculate a
MLR. The elements and definitions would be developed in
consultation with the Health Choices Commissioner,
representatives of MA organizations, experts on health plan
accounting systems, and representatives of the National
Association of Insurance Commissioners. The Secretary would be
required to publish a report describing the elements and
definitions no later than December 31, 2010.
Beginning in 2014, if the Secretary determines that a MA
plan failed to have a MLR of at least 0.85, the plan would be
required provide enrollees with a rebate of their Part C
premiums (or Part B or D, if applicable) by the amount
necessary to meet a MLR of at least 0.85. The Secretary would
also be required to restrict enrollment in the MA plan if the
plan failed to meet the MLR requirement for 3 consecutive years
and terminate the plan's contract if the plan failed to meet
the MLR requirements for 5 consecutive years.
Sec. 1174. Strengthening audit authority
Current Law
The Secretary is required to provide for the annual
auditing of the financial records of at least \1/3\ of MA
plans. Each contract with a MA plan is required to provide that
the Secretary has the right to inspect or evaluate the quality,
appropriateness and timeliness of services performed under the
contract. Contracts must also provide the Secretary with the
right to audit any plan's books and records related to the
plan's ability to bear risk, the services delivered, or any
amounts payable under the contract.
By the first Monday in June, each local MA plan must submit
to the Secretary an aggregate monthly bid amount (which
includes separate bids for required services, any offered
supplemental benefits, and any offered drug benefits) for each
MA plan it intends to offer in the upcoming calendar year. The
bid is based on the average revenue requirements in the payment
area for an enrollee with a national average risk profile. The
Secretary has the authority to evaluate and negotiate the
plan's bid amounts and its proposed benefit packages.
Proposed Law
This provision strengthens the ability of the Secretary to
act on findings from audits of MA plans and Prescription Drug
Plans (PDPs).
Each contract with a MA plan would be required to include a
provision that the Secretary have the authority to take
necessary action, including the pursuit of financial
recoveries, to address deficiencies identified during an annual
audit. The provision would apply to Part D PDPs in the same
manner as certain other MA contract provisions apply to PDP
plans. The provision would apply to audits conducted for
contract years beginning on or after January 1, 2011.
Sec. 1175. Authority to deny plan bids
Current Law
By the first Monday in June, each local MA plan must submit
to the Secretary an aggregate monthly bid amount (which
includes separate bids for required services, any offered
supplemental benefits, and any offered drug benefits) for each
MA plan it intends to offer in the upcoming calendar year. The
bid is based on the average revenue requirements in the payment
area for an enrollee with a national average risk profile. The
Secretary has the authority to evaluate and negotiate the
plan's bid amounts and its proposed benefit packages.
Potential PDP sponsors are also required to submit bids by
the first Monday in June of the year prior to the plan benefit
year. The following information must be included with the bid:
(1) coverage to be provided; (2) actuarial value of qualified
prescription drug coverage in the region for a beneficiary with
a national average risk profile; (3) information on the bid,
including the basis for the actuarial value, the portion of the
bid attributable to basic coverage and, if applicable, the
portion attributable to enhanced coverage, and assumptions
regarding the reinsurance subsidy; and (4) service area. The
bid also includes costs (including administrative costs and
return on investment/profit) for which the plan is responsible.
The bid must exclude costs paid by enrollees, payments expected
to be made by CMS for reinsurance, and any other costs for
which the sponsor is not responsible.
Proposed Law
Under current law, the Secretary has the authority to
negotiate bids with most MA plans and PDPs. So that the
Secretary can hold plans wishing to participate in Part C to a
high standard, this provision clarifies that the Secretary may
reject plan bids.
Sec. 1176. Limitation on enrollment outside open enrollment period of
individuals into chronic care specialized MA plans for special
needs individuals
Current Law
Under the Medicare Prescription Drug, Improvement, and
Modernization Act of 2003 (MMA, P.L. 108-173), Congress created
a new type of Medicare Advantage (MA) coordinated care plan
focused on individuals with special needs. Special needs plans
(SNPs) are allowed to target enrollment to one or more types of
special needs individuals identified by Congress as (1)
institutionalized; (2) dually eligible; and/or (3) individuals
with severe or disabling chronic conditions.
Congress has since passed additional legislation affecting
SNPs. The original SNP authority established by MMA was to
expire on December 31, 2008. Passage of the Medicare, Medicaid,
and SCHIP Extension Act of 2007 (MMSEA, P.L. 110-173)
authorized the SNP program through December 31, 2009, but also
established a moratorium on the creation of SNPs after January
1, 2008, although existing plans could continue to enroll
qualified individuals. More recently, the Medicare Improvements
for Patients and Providers Act of 2008 (MIPPA, P.L. 110-275),
extended the moratorium on designation of new SNPs until
January 1, 2011, and authorized the SNP program through the
same date. MIPPA also required SNPs to collect, analyze, and
report data on their models of care before January 1, 2010.
In addition to legislative changes affecting SNPs, the CMS
has issued regulatory guidance on recent legislative changes.
CMS' guidance included an interim final rule that, among other
issues, required data to be reported that demonstrates
compliance with 10 quality indicators. Most recently, CMS
issued a Final Rule in the January 12, 2009, Federal Register.
The number of SNPs has increased dramatically since 2004,
the first year of operation. In 2004, CMS approved 11 SNPs, but
by January 2008, CMS had approved 787 SNPs, including 442 dual-
eligible SNPs, 256 chronic care SNPs, and 89 institutional
SNPs. In September 2008, there were 1.2 million beneficiaries
in SNPs.
Medicare beneficiaries may enroll in or change their
enrollment in Medicare Advantage from November 15 to December
31 each year. Changes go into effect January 1 of the next
year. During the first three months of the year, beneficiaries
can enroll in an MA plan, and individuals enrolled in an MA
plan can either switch to a different MA plan or return to
original Medicare. Beneficiaries may also enroll in MA or
switch their enrollment if they qualify for a Special Election
Period (SEP) as defined in statutes or by the Secretary. One
SEP specified by the Secretary in the Medicare Managed Care
Manual allows individuals with severe or disabling chronic
conditions to enroll in a SNP designed for individuals with
those conditions. This SEP only applies as long as the
individual has the qualifying condition and ends once the
beneficiary enrolls in a SNP. Once the SEP ends, that
individual may make enrollment changes only during applicable
MA election periods.
Proposed Law
The current SEP for beneficiaries eligible for a chronic
condition SNP encourages aggressive marketing by plans and is
confusing for beneficiaries accustomed to annual enrollment
periods. The new SEP will be more narrowly targeted to the time
around a beneficiary's diagnosis, but the provision gives
authority to the Secretary to determine how long after a
diagnosis the beneficiary is permitted to elect a SNP. This
should be a length of time sufficient for the beneficiary to
understand the consequences of a diagnosis and learn about
options for specialized plans.
This provision would require that beginning on January 1,
2011, SNPs serving beneficiaries with severe or disabling
conditions could only enroll eligible individuals during an
annual, coordinated open enrollment period or at the time of
diagnosis of the disease or condition that would qualify an
individual for a chronic care SNP.
Sec. 1177. Extension of authority of special needs plans to restrict
enrollment
Current Law
Prior to January 1, 2011, SNPs may restrict enrollment to
those who are in one or more classes of special needs
individuals. Starting January 1, 2010, new SNP enrollment must
be limited exclusively to individuals that meet the criteria
for which the SNP is designated: those dually eligible for
Medicare and Medicaid, chronic care, or institutional care.
Further, MIPPA required that dual eligible SNPs contract with
state Medicaid agencies to provide medical assistance services
(Medicaid), which may include long-term care services. If SNPs
do not have contracts with Medicaid agencies by January 1,
2010, then they can continue to operate, but are prohibited
from expanding their service areas. However, state Medicaid
agencies are not required to enter into contracts with SNPs.
Proposed Law
Congress and the Secretary have taken legislative and
regulatory steps to ensure that SNPs offer specialized services
for the populations enrolled. The provision extends SNP
authority for a limited number of years in order to allow plans
to meet these requirements.
A small subset of SNPs that have fully integrated Medicare
and Medicaid services for dually eligible beneficiaries would
receive a longer extension.
This Section would extend the time period, from January 1,
2011, to January 1, 2013, during which SNPs may restrict
enrollment to individuals who meet the definition of the
respective SNP. In addition, certain SNPs that had contracts
with states would be grandfathered so that they would be
permitted to restrict enrollment to beneficiaries who meet the
definition of special needs individuals through January 1,
2016. To be grandfathered SNPs would be required to have had
contracts with states where the state had a CMS-approved
integrated Medicare-Medicaid program as of January 1, 2004.
The Secretary would be required to contract with an
independent health services evaluation organization to evaluate
the grandfathered SNPs in terms of their impact on cost,
quality of care, patient satisfaction, and other subjects as
specified by the Secretary. The Secretary would be required to
submit to Congress by December 31, 2011, a report on the
analysis of the grandfathered SNPs. The report would include
recommendations on the treatment of the grandfathered SNPs as
deemed appropriate by the Secretary.
Subtitle E--Improvements to Medicare Part D
Sec. 1181. Elimination of coverage gap
Current Law
Medicare law sets out a defined standard benefit structure
under the Part D prescription drug benefit. In 2009, the
standard benefit includes a $295 deductible and a 25%
coinsurance until the enrollee reaches $2,700 in total covered
drug spending. After this initial coverage limit is reached,
there is a gap in coverage in which the enrollee is responsible
for the full cost of the drugs until total costs hit the
catastrophic threshold, $6,153.75 in 2009. Each year, the
deductible, co-payments, and coverage thresholds are increased
by the annual percentage increase in average per-capita
aggregate expenditures for covered outpatient drugs for
Medicare beneficiaries for the 12-month period ending in July
of the previous year.
Part D plan sponsors are allowed to offer plans that differ
in benefit design, but are actuarially equivalent, or they may
offer ``enhanced'' plans that offer more generous coverage.
Currently, almost all plans include a coverage gap in their
benefit designs. CMS estimates that 31.7% (8.3 million) of Part
D enrollees reached the initial coverage limit of their drug
plans in 2007.
Some beneficiaries with limited income and resources may
qualify for assistance with a portion of their Part D premiums,
cost-sharing, and other out-of-pocket expenses. Medicare
beneficiaries who qualify for Medicaid based on their income
and assets (dual eligibles) are automatically deemed eligible
for the full low-income subsidy. Prior to the implementation of
the Medicare Part D outpatient prescription drug benefit,
established by the Medicare Prescription Drug Improvement and
Modernization Act of 2003 (MMA, P.L. 108-173), Medicaid was the
primary payer for drugs for full-benefit dual-eligible
beneficiaries.
The Omnibus Budget Reconciliation Act of 1990 (P.L. 101-
508) requires drug manufacturers who wish to have their drugs
available for Medicaid enrollees to enter into rebate
agreements with the Secretary of HHS, on behalf of the states.
Under the agreements, pharmaceutical manufacturers must provide
state Medicaid programs with rebates on drugs paid for Medicaid
beneficiaries. The formulas used to compute the rebates are
intended to ensure that Medicaid pays the lowest price that the
manufacturers offer for the drugs. In return for entering into
agreements with the Secretary, state Medicaid programs are
required to cover all of the drugs marketed by those
manufacturers (with possible exceptions for the 11 categories
of drugs that states are allowed to exclude from coverage).
The rebates are computed and remitted by pharmaceutical
manufacturers each quarter based on utilization information
supplied by the state programs. States collect the rebates from
the manufacturers. The federal share of the rebates are
subtracted from states' claims for their federal share of
program costs. In setting the amount of required rebates, the
law distinguishes between two classes of drugs. The first
includes single source drugs (generally, those still under
patent) and ``innovator'' multiple source drugs (drugs
originally marketed under a patent or original new drug
application (NDA) but for which generic competition now
exists). The second class includes all other, ``non-innovator''
multiple source drugs (generics).
Manufacturers are required to pay state Medicaid programs a
basic rebate for single source and innovator multiple source
drugs. Basic rebate amounts are determined by comparing the
Average Manufacturer Price (AMP) for a drug to the ``best
price,'' which is the lowest price that is offered by the
manufacturer in the same period to any wholesaler, retailer,
nonprofit, or public entity. The basic rebate is the greater of
15.1% of the AMP or the difference between the AMP and the best
price. For non-innovator multiple source drugs, basic rebates
are equal to 11% of the AMP. Manufacturers are also required to
pay an additional Medicaid inflation rebate for single source
drugs. This rebate is equal to the amount by which the increase
in the AMP of the single source drug exceeds the increase in
the consumer price index.
Proposed Law
This provision closes the coverage gap (commonly called the
``doughnut hole'' in Part D prescription drug benefits and
institutes a rebate in Medicare for prescription drugs covered
under Part D.
Funds received from the new rebate requirement will be used
to pay for the elimination of the Part D coverage gap. Since
the program's inception, this mid-year gap in benefits has
plagued millions of beneficiaries who continue to pay their
monthly premium, yet also have to pay 100 percent of the cost
of their drugs out-of-pocket. This section would eliminate the
gap over time, ensuring that beneficiaries are insured against
the full cost of drugs throughout the entire benefit year.
Coverage Gap. This provision would phase in an elimination
of the coverage gap. For each year beginning with 2011, the
Secretary would progressively increase the initial coverage
limit and decrease the annual out-of-pocket threshold until
there is a continuation of coverage from the initial coverage
limit up to the expenditure threshold at which catastrophic
coverage begins. Starting in 2011, the initial coverage limit
for each year, as determined using current annual percentage
increase methodology, would be increased by one-half of the
cumulative phase-in percentage (the sum of the annual phase-in
percentage for the year and the annual phase-in percentages for
each previous year) times the out-of-pocket gap amount (the
amount by which the annual out-of-pocket threshold for the year
exceeds the sum of the annual deductible for the year and one-
fourth the amount by which the initial coverage limit for the
year exceeds the annual deductible). Also beginning in 2011,
the annual out-of-pocket threshold would be decreased by one-
half of the cumulative phase-in percentage of the out-of pocket
gap amount for the year multiplied by 1.75.
The annual phase in percentage would be 13% for 2011; 5%
for years 2012 through 2015; 7.5% for years 2016 through 2018,
and 10% for 2019 and each subsequent year.
The combined effect of those changes would be to eliminate
about $500 of the coverage gap in 2011 and additional amounts
thereafter until it is closed in 2023. The closure of the
coverage gap is split even between increases in the initial
coverage limit and decreases in the catastrophic threshold.
Requiring Drug Manufacturers to Provide Rebates for Full-
Benefit Dual Eligibles. When prescription drug coverage for six
million dually eligible beneficiaries was switched from
Medicaid to Medicare Part D in 2006, drug manufacturers
received a windfall amounting to almost $4 billion in just the
first two years of the program. While Medicaid rebates are
statutorily required at a certain level, rebates in the Part D
program are entirely negotiated between plans and
manufacturers, giving the federal government and taxpayers--who
pay for the Part D program--no control over the level of rebate
provided. Requiring that rebates from drug manufacturers in the
Part D program match the rebates required under Medicaid
ensures that for the same beneficiary, manufacturers are not
permitted to charge higher prices to the government under Part
D than under Medicaid. Manufacturers will continue to enter
into rebate agreements with the Part D plans. However, if that
rebate amount does not equal the Medicaid rebate amount for a
particular drug, the manufacturer would be required to make up
the difference in rebate payments directly to the federal
government.
Under this provision, drug manufacturers would be required
to provide the Secretary a rebate for any covered Part D drug
of the manufacturer dispensed after December 31, 2010, to any
full-benefit dual eligible individual for which payment was
made by a prescription drug plan (PDP) sponsor or a Medicare
Advantage (MA) organization.
The amount of the rebate for a rebate period would be equal
to the product of the total number of units of such dosage form
and strength of the drug dispensed and the amount, if any, by
which the Medicaid rebate, as modified by this statute, and
including both the basic and inflation rebate, for such form,
strength, and period, exceeds the average Medicare drug program
full-benefit dual eligible rebate amount for such form,
strength, and period.
The average Medicare drug program full-benefit dual
eligible rebate amount means with respect to each dosage form
and strength of a covered outpatient drug provided by a
manufacturer for a rebate period, the sum for all PDP sponsors
and MA organizations administering a Medicare Advantage drug
plan (MA-PD), of the product for each such sponsor or
organization of: the sum of all rebates, discounts, or other
price concessions, calculated on a per unit basis (but only to
the extent that any such rebate, discount, or other price
concession applies equally to drugs dispensed to full-benefit
dual eligible Medicare drug plan enrollees and drugs dispensed
to PDP and MA-PD enrollees who are not full-benefit dual
eligible enrollees) and the number of units of such dosage and
strength of the drug dispensed during the rebate period to
full-benefit dual eligible enrollees, divided by the total
number of units of the drug dispensed during the rebate period
to all full-benefit dual eligible PDP and MA-PD enrollees.
In general, a rebate agreement would be effective for an
initial period of not less than 1 year and would be
automatically renewed for a period of not less than 1 year. The
Secretary would be required to establish other terms and
conditions of the rebate agreement including terms and
conditions related to compliance.
For contract years beginning on or after January 1, 2011,
each drug plan contract entered into with a PDP sponsor or a MA
organization would require that the sponsor or organization
report to each manufacturer not later than 60 days after the
end of each rebate period, information on the total number of
units of each dosage, form, and strength of each drug the
manufacturer dispensed to full-benefit dual eligible Medicare
drug plan enrollees under any PDPs or MA-PDs operated by the
sponsor during the rebate period; information on the price
discounts, price concessions, and rebates for such drugs for
such form, strength, and period; information on the extent to
which such price discounts, price concessions, and rebates
apply equally to full-benefit dual eligible Medicare drug plan
enrollees and enrollees who are not full-benefit dual eligible
plan enrollees; and any additional information that the
Secretary determines is necessary to enable the Secretary to
calculate the average Medicare drug program full-benefit dual
eligible rebate amount. The report would be in a form
consistent with a standard reporting format established by the
Secretary, and a copy of the information would be reported to
the Secretary for the purpose of oversight and evaluation. The
information submitted would be treated as confidential. The
rebate would be paid by the manufacturer to the Secretary not
later than 30 days after the date of receipt of this
information.
The provision would allow the Medicare Payment Advisory
Commission, the Congressional Budget Office, and the GAO,
access to the information, and the information reported may be
used by the HHS Office of Inspector General for audits,
investigations, and evaluations. Additional confidentiality
provisions (with the exception of clause iv) from the Medicaid
rebate section (1927(b)(3)) of the Social Security Act also
apply to the Medicare Part D rebate data reported under this
section.
With respect to GAO, the confidentiality provision that
incorporates section 1927(b)(3) of the Social Security Act is
intended to reflect and confirm GAO's existing right to access
Part D information in light of its broad authority at 31 U.S.C.
716.
In cases where information was not submitted timely or if
false information is submitted, penalties would be imposed. PDP
sponsors and MA organizations would be subject to a civil money
penalty in the amount of $10,000 for each day in which such
information has not been provided. If the sponsor or
organization knowingly provides false information, the sponsor
or organization would be subject to a civil money penalty in an
amount not to exceed $100,000 for each item of false
information. Such penalties would be in addition to any other
civil money penalties as may be prescribed by law.
The rebates for full-benefit dual eligible Medicare drug
plan enrollees would be paid into the Medicare Prescription
Drug Account in the Supplementary Medical Insurance Trust Fund
and used to pay for all or part of the gradual elimination of
the coverage gap.
Sec. 1182. Discounts for certain Part D drugs in original coverage gap
Current Law
None.
Proposed Law
In June 2009, the trade association representing brand-name
pharmaceutical manufacturers--PhRMA--pledged to provide a 50%
discount to seniors in the Part D coverage gap to alleviate the
high costs that seniors currently faced. This section would
enact that promise into law.
Manufacturers of prescription drugs would, as a condition
of allowing any of the drugs they manufacture to be treated as
covered drugs under Medicare Part D, be required to enter into
agreements with Medicare Part D drug plan sponsors to provide
discounts on drugs provided to plan enrollees in the coverage
gap period. This provision would be applicable to drugs
dispensed after December 31, 2010.
Under a discount agreement, a drug manufacturer would be
required to provide to each PDP or MA-PD a discount for
qualifying drugs of the manufacturer dispensed to a qualifying
enrollee when in the original Part D coverage gap. A qualifying
drug would be defined as a drug that is produced under an
original new drug application approved by the FDA, or a drug
that was initially marketed under such an application, or a
biological product approved under Section 351(a) of the Public
Health Service Act, and that is covered under the plan's
formulary and is dispensed to an individual who is in the
original gap in coverage.
The Secretary would establish the terms and conditions of
the discount agreement, including those relating to compliance,
similar to the terms and conditions for rebate agreements
between states and drug manufacturers for drugs provided to
Medicaid recipients. However, the discounts would be applied to
PDP and MA-PDs rather than to state plans, PDP sponsors and MA
organizations, instead of states, would be required to provide
the necessary utilization information to drug manufacturers;
and PDP sponsors and MA organizations would be responsible for
reporting information on drug-component negotiated prices
instead of other manufacturer prices used in calculating
Medicaid rebates.
The amount of the discount for a discount period for a plan
would be equal to 50% of the amount of the negotiated price for
qualifying drugs, excluding any dispensing fee for the period
involved. The sponsor or plan would provide the discount to the
enrollee at the time the enrollee pays for the drug if the
enrollee is in the actual gap in coverage, and in such cases
the amount of the discount, in addition to the amount actually
paid by the enrollee, would count toward costs incurred by the
plan enrollee. If the enrollee is in the portion of the
original gap in coverage that is not in the actual gap in
coverage, the discount shall not be applied against the
negotiated price for the purpose of calculating the beneficiary
payment.
A qualifying enrollee is defined as an individual who is
enrolled in a PDP or an MA-PD plan who is not a subsidy-
eligible individual as defined in section 1860D-14(a)(3). The
original gap in coverage is defined as the gap that would occur
between the initial coverage limit and the out-of-pocket
threshold if the phase-out of the coverage gap described in
Section 1181 did not apply. The actual gap in coverage refers
to the gap between the initial coverage limit and the out-of-
pocket threshold as modified by Section 1181.
With regard to payments to pharmacists, discounts under
this section are to be treated in a similar fashion to any
other discounts, rebates, or price concessions provided to PDP
sponsors, and payments to pharmacists in conjunction with these
discounts are to be made consistent with prompt payment
requirements under Section 1860D-12(b)(4), with the pharmacist
to be fully reimbursed for clean claims within 14 days.
Sec. 1183. Repeal of provision relating to submission of claims by
pharmacies located in or contracting with long-term care
facilities
Current Law
Section 172 of the Medicare Improvements for Patients and
Providers Act of 2008 (MIPPA; P.L. 110-275) provided for a new
set of requirements for contracts between Part D drug plan
sponsors and pharmacies located in or contracting with long-
term care facilities for plan years beginning on or after
January 1, 2010. Under that section, each contract entered into
with a PDP sponsor or MA-PD plan is required to provide that a
pharmacy located in or having a contract with a long-term care
facility would have between 30 and 90 days to submit claims for
reimbursement.
Proposed Law
This provision repeals Section 172 of the MIPPA to allow
long-term pharmacies and nursing homes more time to coordinate
with state Medicaid programs.
This provision would be applicable for contract years
beginning with 2010.
Sec. 1184. Including costs incurred by AIDS drug assistance programs
and Indian Health Service in providing prescription drugs
toward the annual out-of-pocket threshold under part D
Current Law
Under a standard Medicare part D plan design, beneficiaries
must incur a certain level of out-of-pocket costs ($4,350 in
2009) before catastrophic protection begins. These include
costs that are incurred for the deductible, cost-sharing, or
benefits not paid because they fall in the coverage gap. Costs
are counted as incurred, and thus treated as true out-of-pocket
(TrOOP) costs only if they are paid by the individual (or by
another family member on behalf of the individual), paid on
behalf of a low-income individual under the subsidy provisions,
or paid under a State Pharmaceutical Assistance Program.
Incurred costs do not include amounts for which no benefits are
provided--for example, because a drug is excluded under a
particular plan's formulary. Additional payments that do not
count toward TrOOP include part D premiums and coverage by
other insurance, including group health plans, workers'
compensation, Part D plans' supplemental or enhanced benefits,
or other third parties.
Proposed Law
This requires the Secretary to count contributions from
other programs designed to help beneficiaries with their drug
costs for the purpose of assessing when a beneficiary reaches
the catastrophic cap. This change will lower prescription drug
costs for beneficiaries who receive assistance from other
sources.
The provision would treat as incurred those costs that are
borne or paid by the Indian Health Service, Indian tribe or
tribal organization or an urban Indian organization (as defined
in Section 4 of the Indian Health Care Improvement Act) to
count toward the out-of-pocket threshold. Costs paid under an
AIDS Drug Assistance Program under part B of title XXVI of the
Public Health Service Act would also count toward the out-of-
pocket threshold. The provision would apply to costs incurred
on or after January 1, 2011.
Sec. 1185. Permitting mid-year changes in enrollment for formulary
changes that adversely impact an enrollee
Current Law
Part D plans are permitted to operate formularies--lists of
drugs that a plan chooses to cover and the terms under which
they are covered. By law part D plans may not change the
therapeutic categories and classes in a formulary other than at
the beginning of each plan year except as the Secretary may
permit to take into account new therapeutic uses and newly
approved covered part D drugs. The law further stipulates that
any removal of a covered part D drug from a formulary and any
change in the preferred or tiered cost-sharing status of such a
drug shall take effect only after appropriate notice is made
available to the Secretary, affected enrollees, physicians,
pharmacies, and pharmacists.
Under current regulations, a part D sponsor may not remove
a covered part D drug from its part D plan's formulary or make
any change in the preferred or tiered cost-sharing status of a
covered part D drug on its plan's formulary between the
beginning of the open enrollment period and 60 days after the
beginning of the contract year associated with that open
enrollment period except under certain circumstances, for
example, when a covered drug has been deemed unsafe by the FDA
or removed from the market by its manufacturer. After March 1
of a given plan year, part D sponsors may make maintenance
changes to their formularies, such as replacing brand name
drugs with new generic drugs or modifying formularies as a
result of new information on drug safety or effectiveness.
According to CMS policy, if part D sponsors remove part D drugs
from their formularies, move covered part D drugs to a less
preferred tier status, or add utilization management
requirements, these changes must be approved by CMS and
sponsors may make such changes only if enrollees currently
taking the affected drug are exempt from the formulary change
for the remainder of the contract year. Part D sponsors may
expand formularies by adding drugs to their formularies,
reducing copayments or coinsurance by placing a drug on a lower
cost-sharing tier, or deleting utilization management
requirements at any time during the year.
Proposed Law
Beneficiaries choose prescription drug plans based on a
number of factors, including whether a plan covers the drugs
they are currently taking. Though CMS has imposed certain
restrictions on plan formulary changes, there is no protection
for beneficiaries who are nonetheless harmed by a mid-year
formulary change. This provision will allow adversely affected
beneficiaries to choose a new plan, and will discourage plans
from making mid-year formulary changes for highly prescribed
drugs.
The provision would establish a special open enrollment
period for an individual to change plans during a period other
than during the annual open enrollment period. The provision
would apply to an individual enrolled in a prescription drug
plan (or an MA-PD plan) who has been prescribed a drug and is
using the drug while enrolled in the plan in the case where the
formulary of the plan materially changed (other than at the end
of the contract year) such as to reduce coverage or increase
the cost-sharing of the drug. The provision would not apply in
cases where the drug was removed from the formulary because of
a recall or withdrawal issued by the Food and Drug
Administration (FDA) or because the drug was replaced with a
therapeutically equivalent generic drug. The provision would
also not apply in instances where utilization management was
applied for drugs for which FDA required a boxed warning or
drugs subject to a Risk Evaluation and Management Strategy
under subsection (f) of section 505-1 of the Federal Food,
Drug, and Cosmetic Act. The provision would apply to contract
years beginning on or after January 1, 2011.
Sec. 1186. Negotiation of lower covered part D drug prices on behalf of
Medicare beneficiaries
Current Law
Part D plan sponsors (or the pharmaceutical benefit
managers (PBMs) they have contracted with) negotiate prices
with drug manufacturers, wholesalers, and pharmacies and are
required to provide beneficiaries with access to these
negotiated prices for covered part D drugs. The law
specifically states that the Secretary may not interfere with
the negotiations between drug manufacturers and pharmacies and
PDP sponsors. Further, the Secretary may not require a
particular formulary or institute a price structure for the
reimbursement of covered part D drugs. This is known as the
non-interference provision (SSA 1860D-11(i)).
Proposed Law
The 2003 Medicare Modernization Act specifically banned the
HHS Secretary from negotiating with drug manufacturers for
lower drug prices on behalf of Part D enrollees. A series of
investigations in 2006, 2007, and 2008 by the House Oversight
Committee has found that the private plans that run the part D
program are unable to effectively negotiate with drug
manufacturers, resulting in higher drug prices for part D
enrollees and higher taxpayer costs for the part D program.
This provision overturns the negotiating ban, and requires that
the Secretary negotiate with drug manufacturers for lower part
D prices.
This provision would strike section 1860D-11(i), and in its
place, add language that would require the Secretary to
negotiate with pharmaceutical manufacturers' prescription drug
prices (including discounts, rebates and other price
concessions) that may be charged to PDP sponsors and MA
organizations. The provision allows prescription drug plans to
obtain discounts or price reductions below those negotiated by
the Secretary. The provision would also maintain the
prohibition against the establishment of a formulary by the
Secretary; however, there would no longer be an explicit
prohibition of the institution of a price structure. Not later
than June 1, 2011, and every six months thereafter, the
Secretary would be required to submit to the House Committees
on Ways and Means, Energy and Commerce, and Oversight and
Government Reform and to the Senate Finance Committee a report
on the prices and discounts achieved as a result of the
negotiations. The provision would take effect on the date of
enactment and would first apply to negotiations and prices for
plan years beginning on January 1, 2011.
PDP sponsors and MA organizations serve as third-party
payers for drugs, reimbursing pharmacies for drugs that the
pharmacies purchase from drug wholesalers or directly from drug
manufacturers. The intent of this section is to reduce the
prices charged by drug manufacturers via the ability of the
Secretary to negotiate with these manufacturers for discounts,
rebates, and price concessions. This section shall not be
construed to require negotiation between the Secretary and
retail or mail-order pharmacies.
Sec. 1187. State certification prior to waiver of licensure
requirements under Medicare prescription drug program
Current Law
Medicare part D participants must obtain coverage through a
part D sponsor--a private insurer or other entity that has
contracted with Medicare to provide prescription drug benefits.
According to section 1860D-12 of the Social Security Act, a
sponsor of a prescription drug plan is required to be organized
and licensed under state law as a risk-bearing entity eligible
to offer health insurance or health benefits coverage in each
state it offers a prescription drug plan. Under certain
circumstances, a sponsor may apply to the Centers for Medicare
and Medicaid Services (CMS) for a waiver of this requirement.
For example, if CMS determines, based on the application and
other evidence presented, that a state did not process a
sponsor's substantially complete application for licensure
within 90 days of receipt, did not approve the licensing
application based on grounds other than those required under
federal law, or does not have a PDP sponsor licensing process
in place, the licensure requirement may be waived. In such
instances, the sponsor must obtain certification from the state
that the organization meets a level of financial solvency or
other standards required by the state.
The National Association of Insurance Commissioners (NAIC)
has noted instances in which PDP sponsors have been granted
waivers from state licensure requirements but did not have
fully completed applications for licensure pending at the time
the waiver had been granted.
Proposed Law
This provision would ensure that prescription drug plans
are in compliance with applicable state laws relating to
insurance licensure.
The provision would amend section 1860D-12 of the Social
Security Act to require that CMS may only grant a waiver of
licensure for a particular state if it has received a
certification from the state insurance commissioner that the
prescription drug plan has a substantially complete application
pending in that state. Additionally, the waiver could be
revoked if the state insurance commissioner submits a
certification to CMS that the sponsor committed fraud with
respect to the waiver, did not made a good faith effort to
satisfy state licensing requirements, or was determined by the
state to be ineligible for licensure. The requirements would be
effective for plan years beginning January 1, 2010.
Subtitle F--Medicare Rural Access Protections
Sec. 1191. Telehealth expansion and enhancements
Current Law
Medicare covers certain services including professional
consultations, office and other outpatient visits, individual
psychotherapy, pharmacological management, psychiatric
diagnostic interview examinations, neurobehavioral status
exams, and end stage renal disease related services delivered
via an eligible telecommunications system. An interactive
telecommunications system is required as a condition of
payment. The originating site (the location of the beneficiary
receiving the telehealth service) can be a physician or
practitioner's office, a critical access hospital, a rural
health clinic, a federally qualified health center, a hospital-
based renal dialysis center, a skilled nursing facility, a
community mental health center or a hospital. The originating
site must be in a rural health professional shortage area or in
a county that is not in a metropolitan statistical area or at
an entity that participates in a specified federal telemedicine
demonstration project.
Proposed Law
This provision expands Medicare's telehealth benefit and
ensures that CMS benefits from valuable outside expertise in
the administration of the benefit.
The provision specifies that a renal dialysis facility
would be included as a covered originating site for telehealth
services effective for services starting January 1, 2011.
The Secretary would appoint a Telehealth Advisory Committee
to make policy recommendations regarding telehealth services
including the appropriate addition or deletion of covered
services and procedure codes for authorized payments.
The Advisory Committee would be composed of 9 members: 5
would be practicing physicians; 2 would be practicing non-
physician healthcare practitioners, and 2 shall be
administrators of telehealth programs. In appointing the
committee members, the Secretary would be required to ensure
that each member has prior experience with the practice of
telemedicine or telehealth; would give preference to
individuals who are currently providing telemedicine or
telehealth services or who are involved in telemedicine or
telehealth programs; would ensure that committee membership
represents a balance of specialties and geographic regions; and
would take into account the recommendations of stakeholders.
The Telehealth Advisory Committee would meet at least twice
each calendar year and at other times provided by the
Secretary. The committee members would serve for the term
specified by the Secretary. An advisory committee member would
not be able to participate in a particular matter considered in
meeting if such a member (or an immediate family member) had a
financial interest that could be affected by the advice given
to the Secretary. Section 14 of the Federal Advisory Committee
Act governing termination, renewal and continuation of
committees would not apply. The Secretary would establish this
committee regardless of any limitation that would apply to the
number of advisory committees that may be established with the
Department of Health and Human Services or otherwise.
In making determinations with respect to covered services,
the Secretary would be required to take into account the
recommendations of the Telehealth Advisory Committee. If the
Secretary does not implement a recommendation, the Secretary
would publish a statement providing the reason for such
decision in the Federal Register.
Sec. 1192. Extension of outpatient hold harmless provision
Current Law
Small rural hospitals (with no more than 100 beds) that are
not sole community hospitals (SCHs) can receive additional
Medicare payments if their outpatient payments under the
prospective payment system are less than under the prior
reimbursement system. For calendar year CY2006, these hospitals
received 95% of the difference between payments under the
prospective payment system and those that would have been made
under the prior reimbursement system. The hospitals receive 90%
of the difference in CY2007 and 85% of the difference in CY2008
and CY2009. Sole community hospitals with not more than 100
beds receive 85% of the payment difference for covered Hospital
Outpatient Department (HOPD) services furnished on or after
January 1, 2009, and before January 1, 2010.
Proposed Law
This provision protects small rural hospitals from the
financial losses they would face under the outpatient
prospective payment system. Eligible hospitals will receive a
partial hold harmless payment until the end of CY2011.
Small rural hospitals and sole community hospitals with not
more than 100 beds would receive 85% of the payment difference
for covered HOPD services furnished until January 1, 2012.
Sec. 1193. Extension of section 508 hospital reclassifications
Current Law
Section 508 of the Medicare Prescription Drug, Improvement
and Modernization Act of 2003 (MMA, P.L. 108-173) provided $900
million for a one-time, 3 year geographic reclassification of
certain hospitals that were otherwise unable to qualify for
administrative reclassification to areas with higher wage index
values. These reclassifications were extended from March 31,
2006, to September 30, 2007, by the Tax Relief and Health Care
Act of 2006 (P.L. 109-432). The Medicare, Medicaid and SCHIP
Extension Act (P.L. 110-173) extended the reclassifications to
September 30, 2008. The Medicare Improvements for Patients and
Providers Act of 2008 (MIPPA, P.L. 110-275) extended the
reclassifications until September 30, 2009. These extensions
are exempt from any budget neutrality requirements.
Proposed Law
The section 508 reclassifications would be extended until
September 30, 2011.
Sec. 1194. Extension of geographic floor for work
Current Law
The Medicare fee schedule is adjusted geographically for
three factors to reflect differences in the cost of resources
needed to produce physician services: physician work, practice
expense, and medical malpractice insurance. The geographic
adjustments are indices that reflect how each area compares to
the national average for a ``market basket'' of goods. A
geographic practice cost index (GPCI) with a value of 1.00
represents the average across all areas. A series of bills set
a temporary floor value of 1.00 on the physician work index
beginning January 2004; most recently, section 134 of the MIPPA
extended the application of this floor when calculating
Medicare physician reimbursement through December 2009. The
other geographic indices (for practice expense and medical
malpractice) were not modified by these Acts.
Proposed Law
Rural physicians put in as much time, skill, and intensity
into their work as physicians in urban areas. This provision
ensures that rural physicians are paid at least the average
rate for their work. Adjustments for practice expense and
malpractice, reflecting the differing costs in operating
practices and purchasing malpractice insurance across the
country, are not affected by this provision.
The proposal would extend the 1.00 floor for the geographic
index for physician work for an additional 2 years through
December, 2011.
Sec. 1195. Extension of payment for technical component of certain
physician pathology services
Current Law
Legislation enacted in 1997 specified that independent labs
that had agreements with hospitals on July 22, 1999, to bill
directly for the technical component of pathology services
could continue to do so in 2001 and 2002. The provision has
been periodically extended, most recently through December 31,
2009 by MIPPA.
Proposed Law
This provision is needed in order to continue allowing
direct billing for the technical component for independent labs
that have agreements with hospitals. Without this extension,
hospitals will incur an additional cost that is not included in
the payment rate under the prospective payment system. This
provision protects rural beneficiaries' access to laboratory
services.
The bill would extend this provision through 2011.
Sec. 1196. Extension of ambulance add-ons
Current Law
Ambulance services are paid on the basis of a national fee
schedule, which is being phased in. The fee schedule
establishes seven categories of ground ambulance services and
two categories of air ambulance services. The national fee
schedule is fully phased in for air ambulance services. For
ground ambulance services, payments through 2009 are equal to
the greater of the national fee schedule or a blend of the
national and regional fee schedule amounts. The portion of the
blend based on national rates is 80% for 2007-2009. In 2010 and
subsequently, the payments in all areas will be based on the
national fee schedule amount.
The fee schedule payment for an ambulance service equals a
base rate for the level of service plus payment for mileage.
Geographic adjustments are made to a portion of the base rate.
For the period July 2004 to December 2009, mileage payments are
increased for ground ambulance services originating in rural
low population density areas. For the period July 1, 2004 until
December 31, 2008, there is a 25% bonus on the mileage rate for
trips of 51 miles and more. Payments for ground transports
originating in rural areas or rural census tracts are increased
by 3% for the period of October 1, 2008, through December 31,
2009.
MIPPA specifies that any area designated as rural for the
purposes of making payments for air ambulance services on
December 31, 2006, will be treated as rural for the purpose of
making air ambulance payments during the period July 1, 2008
until December 31, 2009.
Proposed Law
This provision helps to cover the cost of providing
ambulance services in rural areas.
The provision would maintain the 3% higher payments for
ground transports originating in rural areas or rural census
tracts until December 31, 2011. The MIPPA provision maintaining
the designation of certain areas as rural for the purposes of
Medicare's payments for air ambulance services would be
maintained until December 31, 2011.
Sec. 1197. Ensuring proportional representation of interests in rural
areas on MedPAC
Current Law
The Balanced Budget Act of 1997 established the Medicare
Payment Advisory Commission (MedPAC) to advise Congress on
issues impacting the Medicare program. The Commission is
composed of 17 members appointed for three-year terms by the
Comptroller General. Represented on the Commission are a mix of
health care providers, health researchers, insurance
organization officials, employers, representatives from
prescription drug benefit programs, and consumers, among
others. Specifically, the Medicare statute indicates that
individuals appointed to MedPAC should be nationally recognized
for their expertise in health finance and economics, actuarial
science, health facility management, health plans and
integrated delivery systems, reimbursement of health
facilities, allopathic and osteopathic physicians, and other
providers of health services.
Proposed Law
The provision requires that the proportion of MedPAC
commissioners who would represent the interests of health care
providers and beneficiaries located in rural areas would be no
less than the proportion of total number of Medicare
beneficiaries who live in rural areas. This provision would
apply to appointments to MedPAC made after enactment.
DIVISION B--MEDICARE AND MEDICAID IMPROVEMENTS
TITLE II--MEDICARE BENEFICIARY IMPROVEMENTS
Subtitle A--Improving and Simplifying Financial Assistance for Low-
Income Medicare Beneficiaries
Sec. 1201. Improving assets tests for Medicare savings program and low-
income subsidy program
Current Law
Federal assistance is provided to certain low-income
persons to help them meet Medicare Part D premium and cost-
sharing charges. To qualify for the part D low-income subsidy,
Medicare beneficiaries must have resources no greater than the
income and resource limits established by the Medicare
Prescription Drug, Improvement, and Modernization Act of 2003
(P.L.108-173, MMA).
Individuals may qualify for the full subsidy in two ways:
(1) if they are eligible for Medicaid or one of the Medicare
Savings Programs (Qualified Medicare Beneficiary (QMB),
Specified Low Income Medicare Beneficiary (SLMB), or Qualifying
Individual (QI)), or are recipients of Supplemental Security
Income (SSI) benefits, they are deemed automatically eligible;
or (2) if they apply for the benefit, through their State
Medicaid agency or through the Social Security Administration
(SSA) and are determined to have an annual income below 135% of
the federal poverty level (FPL) and have resources below a
certain limit (in 2009, $6,600 for an individual or $9,910 if
married). Beneficiaries may qualify for a partial subsidy if
they apply and are determined to have an annual income below
150% of the FPL and whose resources do not exceed a certain
limit (in 2009, $11,010 for individuals or $22,010 if married).
(When determining whether a beneficiary qualifies for the
Medicare Part D low-income subsidy, $1,500 per person in
resources are excluded from consideration if the beneficiary
indicates that he/she expects to use resources for burial
expenses; otherwise $1,500 should be added to the above asset
limits for an individual and $3,000 for a couple.)
Federal assistance is also provided to individuals to
assist with premium and cost sharing arising under Parts A and
B of Medicare (the Medicare Savings Programs). QMBs are
entitled to receive payments (on their behalf) for their
Medicare Part B premium and cost-sharing for services under
Parts A and B. SLMBs and QIs are entitled to payments for Part
B premiums. Each category of beneficiary is subject to an
income test and an asset test of $4,000 for an individual and
$6,000 for a couple in 2009.
Proposed Law
This section harmonizes the asset tests for eligibility for
all LIS eligible individuals--full and partial Part D subsidy--
and the MSP to simplify the test, and raises the maximum level
to prevent seniors with nest eggs from being disqualified from
receiving the subsidy.
Under this provision, the maximum resource levels used to
determine eligibility for the low income subsidy would be
increased. In 2012, the level would be $17,000 for an
individual and $34,000 for a couple. In subsequent years, the
asset level would be increased by the annual percent increase
in the Consumer Price Index (all items, U.S. city average) as
of September of the previous year.
These maximum resources levels would also apply for
determining eligibility for Medicare Savings programs,
beginning January 1, 2012.
Sec. 1202. Elimination of part D cost-sharing for certain non-
institutionalized full-benefit dual eligible individuals
Current Law
Cost-sharing subsides for Low-Income Subsidy (LIS)
enrollees are linked to the standard prescription drug
coverage. Full-subsidy eligibles have no deductible, minimal
cost sharing during the initial coverage period and coverage
gap, and no cost-sharing over the catastrophic threshold.
Full-benefit dual eligibles who are residents of medical
institutions or nursing facilities have no cost-sharing. Other
full-benefit dual-eligible individuals with incomes up to 100%
of poverty have cost-sharing, for all costs up to the out-of-
pocket threshold, of $1.10 in 2009 for a generic drug
prescription or preferred multiple source drug prescription and
$3.20 in 2009 for any other drug prescription. All other full-
subsidy-eligible individuals have cost-sharing for all costs up
to the out-of-pocket threshold, of $2.40 in 2009 for a generic
drug or preferred multiple source drug and $6.00 in 2009 for
any other drug.
Proposed Law
Under this provision, cost-sharing would not apply to
persons who are full benefit dual eligibles and for whom a
determination was made that but for the provision of home- and
community-based care, the individual would require the level of
care provided in a hospital or a nursing facility or
intermediate care facility for the mentally retarded and such
care would be paid for by Medicaid. Such home- and community-
based care would be that provided under Section 1915 or 1932 of
the SSA or under a waiver under Section 1115 of the Act. The
provision would apply to drugs dispensed on or after January 1,
2011.
Extending the protection against cost-sharing to dually
eligible beneficiaries who are eligible to be institutionalized
in a hospital or facility for the mentally retarded ensures
that these beneficiaries are not penalized for choosing to
receive care in a home or community-based setting.
Sec. 1203. Eliminating barriers to enrollment
Current Law
In general, states administer eligibility determinations
for the Medicare Savings Program (MSP), a set of cost-sharing
and premium subsidies available to certain low-income Medicare
beneficiaries. Currently, states may require income and asset
documentation through self-declaration or through other
procedures. State policies on this issue vary based on the
eligibility group, but a considerable amount of paper-based
documentation may be required to determine whether an
individual meets financial eligibility requirements for
Medicaid.
Under the low-income subsidy program under Medicare Part D,
full-benefit dual eligibles, those receiving assistance through
Medicare Savings Programs, and recipients of SSI are deemed
subsidy-eligible individuals for up to one year; other persons,
or their personal representatives, have to apply for
assistance. Applicants may apply either at state Medicaid
offices or Social Security offices. Applicants are required to
provide information from financial institutions, as requested,
to support information in the application, and to certify as to
the accuracy of the information provided.
Proposed Law
Medicare beneficiaries applying for a low-income subsidy
under the prescription drug program would be permitted to apply
on the basis of self-certification of income and resources. The
information provided would be subject to administrative
verification; however, and except in extraordinary situations
as determined by the Commissioner of SSA, the individual would
not be required to provide additional documentation.
Verification would be accomplished through data-sharing between
the SSA and the Internal Revenue Service described under
existing authority. This provision would be effective beginning
January 1, 2010.
Sec. 1204. Enhanced oversight relating to reimbursements for
retroactive low-income subsidy enrollment
Current Law
Certain groups of Medicare beneficiaries automatically
qualify (and are deemed eligible) for the full low-income
subsidy. Dual eligibles who qualify for Medicaid based on their
income and assets are automatically deemed eligible for
Medicare prescription drug low-income subsidies. Additionally,
those who receive premium and/or cost-sharing assistance from
Medicaid through the Medicare savings programs, plus those
eligible for SSI cash assistance, are automatically deemed
eligible for low-income subsidies and need not apply for them.
CMS deems individuals automatically eligible for LIS effective
as of the first day of the month that the individual attains
the qualifying status (e.g., becomes eligible for Medicaid,
MSP, or SSI). The end date is, at a minimum, through the end of
the calendar year within which the individual becomes eligible.
For individuals who are newly full-benefit dual eligibles,
their Medicaid prescription drug coverage ceases as soon as the
individual is eligible for part D, regardless of whether the
individual is enrolled in a Part D plan. This creates the risk
of coverage gaps for these individuals. To prevent coverage
gaps between the end of Medicaid prescription drug coverage and
the start of Medicare prescription drug coverage, CMS
regulation specifies that auto-enrollment is effective the
month in which the person becomes full-benefit dual eligible.
Because Medicaid eligibility is often retroactive, CMS randomly
auto-enrolls new full-benefit dual eligibles into Part D plans
retroactively to the start of their full dual status.
Other individuals with limited income and resources who do
not automatically qualify may apply for the low-income subsidy
and have their eligibility determined by either the SSA or
their state Medicaid agency. An individual who applies and is
determined eligible for the LIS is eligible effective the first
day of the month in which the individual submitted an
application. In most cases, this means that LIS status is
applied retroactively. If a beneficiary is already enrolled in
a Part D plan, the Part D sponsor must take steps to ensure
that the beneficiary has been reimbursed for any premiums or
cost-sharing the member had paid that should have been covered
by the subsidy.
CMS issued a request for proposals (RFP) on February 17,
2009, to solicit a contractor (a national prescription drug
plan sponsor) to cover Part D prescription drug claims for
retroactive periods of coverage for full-benefit dual eligible
and SSI-eligible individuals, as well as point of sale coverage
at a pharmacy for certain individuals with the Part D low-
income subsidy who are not yet enrolled in a Part D plan.
Beginning in 2010, CMS has the demonstration authority to test
a revised approach for providing retroactive and immediate need
coverage. Under the demonstration, CMS will contract with a
single Medicare Part D plan (PDP) sponsor to pay for all claims
for retroactive auto-enrollment periods plus current and
immediate need claims for all LIS eligibles. CMS will modify
its auto and facilitated enrollment process so that all those
with retroactive effective dates are assigned to the
demonstration for those retroactive periods, but continue to be
randomly assigned for prospective periods to standard LIS PDPs.
Proposed Law
Through existing authority under current law, the Secretary
has established a requirement that Part D plans make
appropriate retroactive reimbursements to beneficiaries and
third parties. This provision would codify and clarify that
process. It also would implement oversight procedures of the
retroactive reimbursement process to allow the Secretary to
better determine whether the payments for this retroactive
coverage from CMS to the Part D plans are accurately and
consistently reimbursed to beneficiaries and third parties.
In the case of a retroactive LIS enrollment, the
beneficiary, or a third party that is owed payment on behalf of
the beneficiary, would be entitled to be reimbursed for covered
drug costs incurred by the beneficiary during the retroactive
coverage period. The retroactive coverage period is defined as
the period beginning on the effective date of LIS assistance
for which the individual is eligible and ending on the date the
plan effectuates the status of such individual as eligible.
Covered drug costs would be defined as the amount by which the
costs incurred by the beneficiary for covered part D drugs,
premiums and cost sharing exceeds such costs that would have
been incurred if the beneficiary had been receiving low-income
subsidy to which the individual was entitled.
The reimbursement would be made automatically by the Part D
plan sponsor upon appropriate notice that the beneficiary is
eligible for assistance and no further information would need
to be submitted to the plan by the beneficiary. For each such
reimbursement, the PDP or a Medicare Advantage Prescription
Drug Plan (MA-PD) would be required to include a line-item
description of the items for which the reimbursement is made.
Additionally, the provision would require that reimbursement be
submitted not later than 45 days after the date on which the
plan receives notice from the Secretary that the beneficiary is
eligible for assistance or the date on which the beneficiary
files the claim with the plan.
A retroactive LIS enrollment beneficiary would be defined
as an individual who is enrolled in a PDP or an MA-PD and
subsequently becomes eligible as a full-benefit dual eligible
individual, Medicare Savings Program eligible, or eligible for
SSI, or is a full-benefit dual eligible individual who is
automatically enrolled in such a plan. Beneficiaries who
enrolled in a plan whose sponsor entered into a contract with
the Secretary, pursuant to CMS's RFP issued on February 17,
2009, relating to Medicare part D retroactive coverage for
certain low income beneficiaries, or a similar subsequent
request for such proposals, would not be included in this
definition.
Sec. 1205. Intelligent assignment in enrollment
Current Law
Special enrollment rules apply to individuals eligible for
the Part D low income subsidy. Generally, there is a two-step
process for low-income persons to gain Part D coverage. First,
a determination must be made that they qualify for the
assistance; second, they must enroll, or be enrolled, in a
specific Part D plan.
According to Section 1860D-14 of the Social Security Act
(SSA), full-benefit dual-eligible individuals who have not
elected a Part D plan are to be auto-enrolled into one by CMS.
If there is more than one plan available that has a monthly
beneficiary premium that does not exceed the premium assistance
amount under the low-income subsidy, the beneficiary is to be
enrolled on a random basis among all such plans in the PDP
region. The individual has the option of declining or changing
such enrollment.
Some dual eligibles may find that they are auto-enrolled in
a plan that may not best meet their needs. For example, it is
possible that the specific drug(s) that a beneficiary is
currently taking is not covered by the new plan. For this
reason, beneficiaries are able to change enrollment at any
time, with the new coverage effective the following month.
Proposed Law
The Medicare Modernization Act prohibited CMS from using
any methodology other than random assignment when automatically
enrolling full benefit dual eligibles into Part D plans. While
this process results in beneficiaries enrolled in the lowest
cost plans based on monthly premium, it does not take into
consideration whether this vulnerable population is enrolled in
quality plans that cover the beneficiaries' necessary
medications. While dual eligibles have the option of enrolling
in a different plan, this is a particularly frail population
that may not have the capacity to evaluate and choose among all
of the available plans. The provision instructs CMS to evaluate
methodologies for intelligently assigning dual eligibles to
Part D plans based on cost--but also on formulary coverage for
beneficiaries' needed prescriptions, use of prior authorization
and other restrictions, and quality measures--and to implement
if the Secretary determines that a methodology could both
minimize cost to the program and maximize access of dual
eligibles to needed prescription drugs.
The Secretary would be given the option to use an
``intelligent assignment'' process as an alternative to the
random assignment process. The intelligent assignment process
would be designed to maximize the access of full-benefit dual
eligibles to necessary prescription drugs while minimizing
costs to the individual and to the program to the greatest
extent possible. The process would be required to take into
account the extent to which prescription drugs necessary for
the individual are covered, the use of prior authorization or
other restrictions on access to coverage of drugs, and the
overall quality of a prescription drug plan as measured by
quality ratings established by the Secretary.
The provision would take effect for contract years
beginning with 2012.
Sec. 1206. Special enrollment period and automatic enrollment process
for certain subsidy eligible individuals
Current Law
In general, a Medicare beneficiary who does not enroll in
Part D during his or her initial enrollment period may enroll
only during the annual open enrollment period, which occurs
from November 15 to December 31 each year. Coverage begins the
following January 1. Beneficiaries already enrolled in a Part D
plan may change their plans during the annual open enrollment
period.
There are a few additional, limited occasions when an
individual may enroll in or disenroll from a Part D plan or
switch from one Part D plan to another, called special
enrollment periods. For example, special enrollment periods are
allowed for individuals who (1) move to a new geographic area,
(2) involuntarily lose creditable coverage, (3) receive
inadequate information on creditable coverage status, (4) are
subject to a federal error, or (5) are enrolled in a PDP that
has failed or been terminated.
Proposed Law
Under current statutory authority, the Secretary has
established a continuous SEP whereby upon becoming eligible for
Part D, the Secretary automatically enrolls full benefit dual
eligibles into a Part D plan; the individual retains the right
to decline or change enrollment in any month. The Secretary has
also expanded this SEP to include all individuals who are
eligible for the Part D low-income subsidy (LIS). This
provision codifies CMS's interpretation of current law with
regard to allowing an SEP and automatic enrollment process for
all LIS-eligible beneficiaries. It also requires the Secretary
to use an automatic assignment process to enroll low-income
beneficiaries who failed to enroll in a prescription drug plan
or MA-PD plan during the special enrollment period. This
assignment process would be identical to that used for full-
benefit dual eligibles. The individual would have the option of
declining or changing such enrollment.
The provision would apply with respect to subsidy
determination made for months beginning with January 2011.
Sec. 1207. Application of MA premiums prior to rebate in calculation of
low income subsidy benchmark
Current Law
The federal government pays up to 100% of the Part D
premiums for LIS beneficiaries who are enrolled in benchmark
plans. A Part D plan qualifies as a benchmark plan if it offers
basic Part D coverage with premiums equal to or lower than the
regional low-income premium subsidy amount. The regional low-
income benchmark premium amount, calculated annually, is the
weighted average of all premiums in each of the 34 prescription
drug plan (PDP) regions for basic prescription drug coverage,
or the actuarial value of basic prescription drug coverage for
plans that offer enhanced coverage options, or for Medicare
Advantage Prescription Drug plans (MA-PD), the portion of the
premium attributable to basic prescription drug benefits.
Under the Medicare Advantage program (Part C), plans bid to
offer Parts A and B coverage to beneficiaries. CMS bases the
Medicare payment for a MA plan on the relationship between its
bid and a benchmark (different from the LIS benchmark). The MA
benchmark represents the maximum amount the federal government
will pay a plan for providing required Medicare benefits. If a
plan's bid is less than the benchmark, its payment equals its
bid plus a rebate of 75% of the difference between the
benchmark and the bid. The rebate must be used to provide
additional benefits to enrollees, reduce Medicare cost sharing
expenses, or reduce a beneficiary's monthly Part B,
prescription drug, or supplemental premium (for services beyond
the required Medicare benefits).
MA plans offering prescription drug coverage submit a
separate bid for the Part D portion. Payment for the portion of
the premium attributable to basic prescription drug benefits is
calculated in the same way as that for stand-alone PDPs;
however the MA plan may choose to apply some of its Part C
rebate payments to lower the Part D premium. Any contribution
by an MA plan of its rebate amount towards the Part D premium
will lower the Part D benchmark premium amount and, typically,
reduce the number of standalone PDPs qualifying as full-subsidy
plans.
Proposal
The statute would be modified to exclude the Part C rebate
amounts from the MA-PDP premium bids when calculating the low-
income regional benchmark for subsidy determinations made for
months beginning with January 2011.
Excluding the rebate portion of the premium from the
calculation of the LIS benchmark will decrease the number of
beneficiaries who have to switch plans each year because their
plan's premium exceeds the LIS benchmark.
Subtitle B--Reducing Health Disparities
Sec. 1221. Ensuring effective communication in Medicare
Current Law
Federal civil rights policy (Section 601 of Title VI of the
Civil Rights Act of 1964, 42 U.S.C. 2000d) requires most health
care providers to make interpretation services available to
limited English proficiency (LEP) patients. Health and Human
Services (HHS) regulations promulgated pursuant to section 602
forbid recipients from utiliz[ing] criteria or methods of
administration which have the effect of subjecting individuals
to discrimination because of their race, color, or national
origin, or have the effect of defeating or substantially
impairing accomplishment of the objectives of the program with
respect to individuals of a particular race, color, or national
origin. 45 CFR 80.3(b)(2).
HHS regulations (45 CFR 80.3(b)(2)) require all recipients
of federal financial assistance from HHS to provide meaningful
access to LEP persons. Recipients of HHS assistance may include
(but are not limited to) hospitals, nursing homes, home health
agencies, managed care organizations, universities, state,
county, and local health agencies, Medicaid agencies, public
and private contractors, vendors, physicians, and other
providers. Providers who only receive Medicare Part B payments
are not considered recipients of HHS assistance (45 CFR 80.2).
Research has demonstrated that Medicare beneficiaries with
limited English proficiency have a harder time accessing health
care than LEP seniors covered by Medicaid. Some authors have
argued that this difference may be attributed to the fact that
federal civil rights policies require Medicaid health care
providers to offer language assistance, while physicians
serving only Medicare patients are not subject to the same
requirements. Although all providers are bound by Civil Rights
Act of 1964 which obligates health care professionals to make
interpreters available to LEP patients, studies have suggested
that a lack of reimbursement for language services and poor
enforcement of Title VI has sometimes made it difficult for LEP
Medicare beneficiaries to access translation services.
Proposed Law
This provision directs the Secretary to evaluate the
effectiveness of culturally and linguistically appropriate care
by directing the Secretary to conduct a study that examines the
extent to which Medicare providers utilize, offer or make
available language services for beneficiaries who are limited
English proficient. The study will also evaluate ways that
Medicare should develop payment systems for language services.
The provision would require the Secretary of the Department
of Health and Human Services to conduct a study to examine the
extent to which Medicare providers utilize, offer, or make
available language services for beneficiaries who are limited
English proficient and ways that Medicare should develop
payment systems for language services. The study would include
an analysis of: ways to develop and structure appropriate
payment systems for language services for Medicare providers;
the feasibility of adopting a payment methodology for on-site
interpreters; the feasibility of Medicare contracting directly
with agencies that provide off-site interpretation, including
telephonic and video interpretation; the feasibility of
modifying the existing Medicare resource-based relative value
scale by using adjustments when a patient is LEP; and how each
of these options would be funded. The study would also include
an analysis of the extent to which providers under Medicare
Parts A, B, C, and D utilize, offer, or make available language
services for beneficiaries with LEP; and the nature and type of
language services provided by states for Medicaid recipients,
and the extent to which such services could be utilized by
Medicare providers.
The potential payment systems included in the analysis
could allow variations based on types of service providers,
available delivery methods, and costs for providing language
services. Factors could include: the type of language service
provided, such as the provision of health care or health care
related services directly in a non-English language by a
bilingual provider or use of an interpreter; the type of
interpretation provided, such as in-person, telephonic, video
interpretation; the methods and costs of providing language
services, including the costs of providing language services
with internal staff and/or through contract with external
independent contractors or agencies; providing services for
languages not frequently encountered in the United States; and
providing services in rural areas.
The Secretary would be required to submit a report to
appropriate committees of Congress not later than 12 months
after the date of enactment of this Act. The Paperwork
Reduction Act would not apply for purposes of carrying out this
study. The necessary funds to conduct the study would be
authorized to be appropriated.
This provision also would authorize the Secretary to apply
sanctions, such as civil money penalties, suspension of
enrollment, and suspension or payments, to Medicare Advantage
organizations that substantially fail to provide required
language services to LEP beneficiaries enrolled in their plans.
Sec. 1222. Demonstration to promote access for Medicare beneficiaries
with limited-English proficiency by providing reimbursement for
culturally and linguistically appropriate services
Current Law
Refer to current law under Section 1221.
Proposed Law
Although recipients of federal funds are required to offer
language services, Medicare does not reimburse for these
services. Testing alternative methods of delivering culturally
and linguistically appropriate services will enable Medicare to
apply best practices and improve both access to and quality of
services to beneficiaries with limited English proficiency.
Not later than 6 months after the completion of the study
described in section 1221, the Secretary, acting through the
CMS, would be required to carry out a demonstration program
under which the Secretary would award no fewer than 24 three-
year grants to eligible Medicare providers to improve effective
communication between providers and Medicare beneficiaries
living in communities where racial and ethnic minorities,
including populations that face language barriers, are
underserved with respect to such services. Using the results of
the completed study, the Secretary would adjust, as
appropriate, the distribution of grants to target Medicare
beneficiaries who are in the greatest need of language
services. Grants would be limited to $500,000 or less over
three years for any grantee.
To be eligible to receive a grant, an entity would be
required to be a Medicare provider of services under Parts A or
B, a Medicare Advantage organization offering a Medicare part C
plan, or a sponsor of a part D prescription drug plan (PDP). To
the extent feasible, the Secretary would award at least 6
grants each to part A providers, part B providers, part C
organizations, and to prescription drug sponsors. The Secretary
would be required to give priority to applicants that have
developed partnerships with community organizations or agencies
with experience in language access. The Secretary would also
need to ensure that grantees represent variations in types of
language services, languages needed and their frequency of use,
urban and rural settings, at least two geographic regions as
defined by the Secretary, and at least two large urban areas
with diverse populations.
The grantee would be required to use the grant funds to pay
for the provision of competent language services to LEP
Medicare beneficiaries. Such services may be provided through
on-site interpretation, telephonic interpretation, video
interpretation, or direct provision of health care or health
care-related services by a bilingual health care provider. The
grantee may also use bilingual providers, staff, or contract
interpreters. The grantee may use up to 10% of the grant funds
to pay for administrative costs associated with the provision
of competent language services and for required reporting.
Grantees that are part C organizations or PDP sponsors would be
required to ensure that their network providers, including
physicians and pharmacies, receive at least 50% of the grant
funds to pay for the provision of language services.
The payments to grantees would be calculated based on the
estimated numbers of LEP Medicare beneficiaries in a grantee's
service area, using the most recently available data from the
Bureau of Census or other state-based study on the number of
individuals served by the grantee who speak English less than
``very well,'' or using the grantee's own data on Medicare
beneficiaries' primary language if the Secretary determines
such data to be reliable. Payment would only be provided to
grantees that report their costs of providing language services
and may be modified annually at the discretion of the
Secretary. If the grantee does not provide the reports for the
first year of a grant, the Secretary would be able to terminate
the grant and to solicit applications from new grantees to
participate in the subsequent two years of the demonstration
program.
Payments would only be provided to grantees that utilize
competent bilingual staff or competent interpreter or
translation services which meet the state standards currently
in effect if the grantee operates in a state that has statewide
health care interpreter standards. For grantees operating in
states without such standards, the grantee would be required to
utilize interpreters who follow the National Council on
Interpreting in Health Care's Code of Ethics and Standards of
Practice. This requirement would not apply if a beneficiary
requests the use of family, friends, or other persons untrained
in interpretation and the grantee documents the request in the
beneficiary's record. This requirement would also not apply in
the case of a medical emergency where the delay associated with
obtaining an interpreter would jeopardize the health of the
patient. Emergency rooms and other entities that regularly
provide health care services in medical emergencies, would,
however not be exempt from the requirement to provide
interpreter and translation services without undue delay.
Grantees would also be required to: ensure that appropriate
clinical and support staff receive ongoing education and
training in linguistically appropriate service delivery; ensure
the linguistic competence of bilingual providers; offer and
provide appropriate language services at no additional charge
to each LEP patient at all points of contact, in a timely
manner during all hours of operation; notify Medicare
beneficiaries of their right to receive language services in
their primary language; post signage in the languages of the
commonly encountered group or groups present in the
organization's service area; and ensure that primary language
data are collected for recipients of language services (if the
recipient of language services is a minor or is incapacitated,
the primary language of the parent or legal guardian would be
collected and utilized).
Grantees would be required to provide the Secretary with
reports at the end of each year of the grant. The report would
include (1) the number of Medicare beneficiaries to whom
language services are provided; (2) the languages of those
Medicare beneficiaries; (3) the types of language services
provided; (4) the type of interpretation; (5) the methods of
providing language services; (6) the length of time for each
interpretation encounter; and (7) the costs of providing
language services.
LEP Medicare beneficiaries would not be required to pay
cost-sharing or co-pays for language services provided under
this demonstration.
The Secretary would be required to conduct an evaluation of
the demonstration program and submit a report to the
appropriate committees of Congress not later than 1 year after
the completion of the program. The report would include an
analysis of the patient outcomes and costs of furnishing care
to the LEP Medicare beneficiaries participating in the project
compared to those not participating; the effect of delivering
culturally and linguistically appropriate services on
beneficiary access to care, utilization of services, efficiency
and cost-effectiveness of health care delivery, patient
satisfaction, and health outcomes; and recommendations
regarding the extension of the project to the entire Medicare
program.
This provision would not limit existing obligations of
recipients of federal financial assistance under title VI of
the Civil Rights Act of 1964. An amount of $16 million would be
authorized to be appropriated for each fiscal year of the
demonstration program.
Sec. 1223. IOM report on impact of language access services
Current Law
Refer to current law under Section 1221.
Proposed Law
Under this provision, the Secretary of HHS would be
required to enter into an arrangement with the Institute of
Medicine (IOM) under which the IOM would prepare a report on
the impact of language access services on the health and health
care of limited English proficient populations. The report
would be issued not later than 3 years after the date of the
enactment of the Act.
The report would include recommendations on the development
and implementation of policies and practices by health care
organizations and providers for limited English proficient
patient populations, a description of the effect of providing
language access services on quality of health care and access
to care and reduced medical error, and a description of the
costs associated with, or savings related to, the provision of
language access services.
Sec. 1224. Definitions
Current Law
None.
Proposed Law
This provision provides the following definitions to be
applied in sections 1221 through 1223.
The term bilingual would mean a person who has a sufficient
degree of proficiency in two languages and can ensure that
effective communication can occur in both languages.
The term competent interpreter services would be defined as
a trans-language rendition of a spoken message in which the
interpreter comprehends the source language and can speak
comprehensively in the target language to convey the intended
meaning. The interpreter would be required to know health and
health-related terminology.
The term competent translation services would mean a trans-
language rendition of a written document in which the
translator comprehends the source language and can write
comprehensively in the target language to convey the meaning
intended in the source language. The translator would be
required to know health and health-related terminology.
The term effective communication would mean an exchange of
information between the provider of health care or health care-
related services and the LEP recipient of such services that
enables the LEP individual to access, understand, and benefit
from health care or health care-related services.
The terms interpreting/interpretation would be defined as
the transmission of a spoken message from one language into
another, faithfully, accurately, and objectively.
The term health care services would mean services that
address physical as well as mental health conditions in all
care settings.
The term health care-related services would be defined as
human or social services, programs or activities that provide
access, referrals or links to health care.
The term language access would mean the provision of
language services to an LEP individual designed to enhance that
individual's access to, understanding of or benefit from health
care or health care-related services.
The term language services would be defined as the
provision of health care services directly in a non-English
language, interpretation, translation, and non-English signage.
The term limited-English proficient (LEP) would be defined
as an individual who speaks a primary language other than
English and who cannot speak, read, write or understand the
English language at a level that permits the individual to
effectively communicate with clinical or nonclinical staff at
an entity providing health care or health care related
services.
The term Medicare beneficiary would mean an individual
entitled to benefits under Medicare part A or enrolled in
Medicare part B.
The term Medicare program would mean the programs under
parts A through D of title XVIII of the Social Security Act
(SSA).
The term service provider would be defined as all
suppliers, providers of services, or entities under contract to
provide coverage, items or services under any part of title
XVIII of the SSA.
Subtitle C--Miscellaneous Improvements
Sec. 1231. Extension of therapy caps exceptions process
Current Law
Current law places two annual per beneficiary payment
limits for all outpatient therapy services provided by non-
hospital providers. For 2009, the annual limit on the allowed
amount for outpatient physical therapy and speech-language
pathology combined is $1,840. There is a separate limit for
occupational therapy of $1,840. The Secretary was required to
implement an exceptions process for 2006, 2007, and the first
half of 2008 for cases in which the provision of additional
therapy services was determined to be medically necessary.
Section 141 of the Medicare Improvements for Patients and
Providers Act of 2008 (MIPPA, P.L. 110-275) extended the
exceptions process for therapy caps through December 31, 2009.
Proposed Law
The provision would extend the exceptions process for
therapy caps for 2 years, through December 31, 2011.
Sec. 1232. Extended months of coverage of immunosuppressive drugs for
kidney transplant patients and other renal dialysis provisions
Current Law
To be eligible for Medicare, one must be (1) 65 years or
older and eligible to receive Social Security; (2) under 65,
permanently disabled, and have received Social Security
disability insurance payments for at least 2 years; (3) have
Amyotrophic Lateral Sclerosis (ALS-Lou Gehrig's disease); or
(4) have end-stage renal disease (ESRD).
Coverage for beneficiaries with ESRD generally begins in
the fourth month of dialysis treatments or the month of a
kidney transplant. After receiving a kidney transplant,
individuals are prescribed immunosuppressive drugs to reduce
the risk of their immune system rejecting the new organ. These
drugs generally need to be taken for the rest of the
individual's life.
Under Medicare Secondary Payer (MSP) rules, Medicare is
prohibited from making payments for any item or service when
payment has been made or can reasonably be expected to be made
by a third party payer. For individuals with Medicare
entitlement based solely on ESRD, MSP rules apply for those
covered by an employer-sponsored group plan, regardless of the
employer size or current employment status. Any group health
plan coverage these beneficiaries receive through their
employer or their spouse's employer is the primary payer for
the first 30 months of ESRD benefit eligibility. After 30
months, Medicare becomes the primary insurer.
If a beneficiary already had Medicare because of age or
disability before the onset of end-stage renal disease, or if
an individual became eligible for Medicare because of age or
disability after receiving a transplant paid for by Medicare,
Medicare will continue to pay for immunosuppressive drugs with
no time limit. However, if a beneficiary qualifies for Medicare
only because of kidney failure, Medicare, together with
coverage of the immunosuppressive drugs, ends 36 months after
the month of the successful transplant. After that period,
kidney recipients must pay for immunosuppressive drugs through
private insurance, public or pharmaceutical programs, or pay
out-of-pocket until they reach 65 and qualify for Medicare
because of age.
Individuals with ESRD are eligible for all Part B Services.
Part B covers their dialysis services, drugs, and biologicals,
including erythropoiesis stimulating agents, diagnostic
laboratory tests, and other items and services furnished to
individuals for the treatment of ESRD.
Dialysis services are offered in three outpatient settings:
hospital-based facilities, independent facilities, and the
patient's home. There are two methods for payment. Under Method
I, facilities are paid a prospectively set amount, known as the
composite rate, for each dialysis session, regardless of
whether services are provided at a facility or in the patient's
home. Beneficiaries electing home dialysis may choose not to be
associated with a facility and may make independent
arrangements with a supplier for equipment, supplies, and
support services. Payment to these suppliers, known as Method
II, is made on the basis of reasonable charges.
The Medicare Improvements for Patients and Providers Act of
2008 (MIPPA, P.L. 110-275) requires the Secretary to implement
a bundled payment system, making a single payment for Medicare
renal dialysis services, to be phased in over 4 years beginning
January 1, 2011. The bundled payment will include (1) items and
services included in the composite rate as of December 31,
2010; (2) erythropoiesis stimulating agents for the treatment
of ESRD; (3) injectable biologicals and medications that were
paid for separately under Part B (before bundling) and any oral
equivalent to such medications; and (4) diagnostic laboratory
tests and other items and services furnished to individuals for
the treatment of ESRD. Dialysis facilities will have the
opportunity to opt out of the phase-in and be paid under the
new bundled system starting in 2011. The new law also creates a
quality incentive payment program that ties payments to certain
quality measures including anemia management, dialysis
adequacy, patient satisfaction, and bone mineral metabolism.
Proposed Law
Patients who receive a kidney transplant must continue
taking immunosuppressive drugs for the rest of their lives in
order to avoid rejecting the new organ. Once a patient stops
taking the drugs, his or her body will almost immediately
reject the transplanted kidney and the patient either needs
another kidney transplant or requires dialysis treatments for
the rest of his or her life. Because a recurrence of kidney
failure again entitles the beneficiary to Medicare, these costs
are incurred by the Medicare program. To remedy this problem,
and to improve the quality of life of these patients, this
provision removes the 36-month limit on entitlement to Medicare
with respect to immunosuppressive therapies to ensure that
transplant patients continue to receive the drugs they need.
This provision would amend SSA title II (Old Age, Survivors
and Disability Insurance) to (1) continue entitlement to
prescription drugs used in immunosuppressive therapy furnished
to an individual who receives a kidney transplant for which
payment is made under Medicare, and (2) extend Medicare
secondary payer requirements for ESRD beneficiaries.
It would also amend title XVIII (Medicare) of SSA to apply
special rules to kidney transplant recipients who receive
additional coverage for immunosuppressive drugs whose
eligibility for benefits would end but for application of this
section. Such individuals would be deemed to be enrolled under
Medicare Part B and would be responsible for the full amount of
the applicable premiums, deductibles, and co-insurance payments
that are not covered under the Medicare savings program.
This section also includes a technical clarification that
oral drugs furnished to individuals for treatment of ESRD are
included in the bundled payment. This authority exists under
current law.
The provision specifies that oral drugs that are not the
oral equivalent of an intravenous drug would be included in the
drugs and biologicals provided as part of the renal dialysis
services covered by Medicare. The provision also would allow
providers of renal dialysis services to make an election with
respect to 2011, 2012, or 2013, prior to the first date of such
year, to be excluded from the phase in of the prospective rate
(or the remainder of the phase in) and be paid entirely based
on the prospective rate. Additionally, the provision changes
the performance standards of ESRD providers from the ``lesser
of'' to the ``greater of'' the performance of such provider or
facility or a performance standard based on the national
performance rates for such measures in a period determined by
the Secretary.
Sec. 1233. Advance care planning consultation
Current Law
Section 1866(f) of Title XVIII of the SSA requires certain
institutional providers and prepaid plans that participate in
Medicare to follow specified policies and procedures in regard
to advance directives. Specifically, it requires such entities
to furnish written information regarding an individual's rights
under state law to make decisions concerning medical care,
including the right to accept or refuse medical or surgical
treatment and the right to formulate advance directives; to
furnish the written policies of the entity respecting the
implementation of such rights; to document in a prominent part
of the individual's medical record whether or not the
individual executed an advance directive; not to condition the
provision of care or otherwise discriminate against an
individual based on whether or not the individual has executed
an advance directive; to ensure compliance with requirements of
state law (whether statutory or as recognized by the courts of
the state) respecting advance directives at facilities of the
provider or organization; and to provide (individually or with
others) for education for staff and the community on issues
concerning advance directives.
Hospitals and nursing homes must provide this information
to individuals at the time of admission; home health agencies
must provide it in advance of the individual coming under the
care of such agencies; hospice providers must provide this
information at the time of the initial receipt of hospice care;
and prepaid health plans must provide it to individuals upon
enrollment. Medicare-certified providers that do not comply
with these requirements may have payments withheld by the
Secretary. State laws that allow for an objection on the basis
of conscience for any health care provider or any agent of such
provider which, as a matter of conscience, cannot implement an
advance directive, supersede these requirements.
The Medicare Improvements for Patients and Providers Act of
2008 (MIPPA, P.L. 110-275) added end-of-life planning to the
initial preventive physical exam that Medicare beneficiaries
receive upon enrollment in Medicare. MIPPA also defines ``end-
of-life'' planning to mean verbal or written information
regarding: an individual's ability to prepare an advance
directive in the case that an injury or illness causes the
individual to be unable to make health care decisions; and
whether or not the physician is willing to follow the
individual's wishes as expressed in an advance directive.
The Physician Quality Reporting Initiative (PQRI), the
voluntary individual reporting program that provides an
incentive payment to eligible professionals (EPs) who
satisfactorily report data on quality measures for covered
Medicare Physician Fee Schedule (PFS) services, is established
by section 1848(k)(1) of the SSA. PQRI requires eligible
professionals to report on certain quality measures in order to
receive an incentive payment equal to 2.0% of covered
professional services. Participation in PQRI is voluntary. The
PQRI program is not specific to end-of-life care, but it does
include several geriatrics measures, including one measure
which specifically addresses advance care plans. This measure
aims to assess whether a patient has an advance care plan or
surrogate decision maker documented in their medical record.
CMS was mandated by the Balanced Budget Act of 1997 (P.L.
105-33) to develop and organize activities to educate
beneficiaries about the Medicare program. Specifically, the Act
mandated that CMS establish a toll-free helpline, mail written
information to beneficiaries on Medicare and their options to
enroll in private plans, create a Medicare website, and support
a community outreach program to help beneficiaries and their
caregivers make informed health care decisions. CMS conducts
these activities as part of its National Medicare and You
Education Program (NMEP). The Medicare & You Handbook is one
component of the agency's NMEP program. The Handbook, which is
produced in English and Spanish, is updated on an annual basis
and mailed to beneficiaries every fall. Handbooks are mailed
monthly to newly eligible beneficiaries.
Proposed Law
This provision adds an advanced care planning consultation
as a Medicare benefit and makes other changes intended to
promote patient-centered decision-making about medical care
options. Advanced planning consultations are designed to assist
patients make informed decisions about the full range of life
sustaining treatment options available and to ensure that
treating physicians are fully aware of patients' wishes. The
provision does not require any beneficiary to receive such
consultations and does not prescribe or restrict the advanced
care treatment options available to any beneficiary.
The provision would amend Section 1861 of Title XVIII of
the SSA under Medicare to add new language concerning an
advance care planning consultation and add a new subsection
describing these consultations. It would amend Section
1848(j)(3) to provide payment to physicians for an advance care
planning consultation under Medicare. The provision would also
expand the physician quality reporting initiative for end of
life care. The Medicare & You Handbook would be updated to
include an explanation of various end-of-life care planning
terms and resources.
The term ``advance care planning consultation'' would mean
a consultation between the individual and an individual's
physician, nurse practitioner or physician assistant as
specified regarding advance care planning. Such consultation
would be covered not more than once every five years, with some
exceptions. Medicare's initial preventative physical
examination would not be considered an advance care planning
consultation for purposes of applying the 5-year limitation.
Such consultation would be authorized to be conducted more
frequently if there is a significant change in an individual's
health.
Such a consultation would be required to include an
explanation by the practitioner of advance care planning;
advance directives and their uses; role and responsibilities of
a health care proxy; the continuum of end-of-life care services
and supports available and Medicare benefits that are
available. Practitioners would be required to provide a list of
national and state-specific resources to assist consumers and
their families with advance care planning. The advance care
planning consultation would also be required to include an
explanation of orders regarding life sustaining treatment or
similar orders as specified. This requirement would apply to
consultations furnished in a state in which all legal barriers
for such orders have been addressed and that has a program in
effect as specified. Such consultation is authorized to include
the formulation of an order regarding life sustaining treatment
or similar order.
The term ``order regarding life sustaining treatment''
would mean, with respect to an individual, an actionable
medical order relating to the treatment of that individual that
(1) is signed and dated by a physician or another health care
professional as specified and is in a form that permits it to
stay with the individual and be followed by health care
professionals and providers across the continuum of care; (2)
effectively communicates the individual's preferences regarding
life sustaining treatment; (3) is uniquely identifiable and
standardized within a given locality, region, or state (as
identified by the Secretary); and (4) may incorporate any
advance directive if executed by the individual.
The level of life treatment indicated may range from an
indication for full treatment to an indication to limit some or
all or specified interventions. The provision would modify
Section 1848(j)(3) of the SSA (concerning definitions for
physicians' services) to include Medicare payment for
physicians' services with respect to an advance care planning
consultation. It would amend Section 1862(a)(1) of the SSA
(concerning exclusions from coverage and Medicare as secondary
payer) to add that no Medicare payment would be authorized for
expenses incurred in the case of an advance care planning
consultation which is performed more frequently than covered
under such section.
The provision would amend Section 1848(k)(2) of the SSA to
add new language that would require the Secretary, for the
purposes of reporting data on quality measures for covered
professional services furnished during 2011 and any subsequent
year, to include quality measures on end of life care and
advanced care planning that have been adopted or endorsed by a
consensus-based organization, if available and appropriate.
Such measures would be required to measure both creation and
adherence to orders for life-sustaining treatment. The
Secretary would be required to publish these proposed measures
in the Federal Register and provide for a period of public
comment before finalization.
No later than 1 year after the date of enactment, the
Secretary would be required to update the online version of the
Medicare & You Handbook to include an explanation of advance
care planning and advance directives, including living wills,
durable power of attorney, orders of life-sustaining treatment,
and health care proxies. It would also be updated to include a
description of federal and state resources available to assist
individuals and their families with advance care planning and
advance directives, including available state legal service
organizations to assist individuals with advance care planning,
including those organizations that receive funding pursuant to
the Older Americans Act of 1965; website links or addresses for
state-specific advance directive forms; and any additional
information, as determined by the Secretary. The Secretary
would also be required to include the above information in all
paper and electronic versions of the Medicare & You Handbook
that are published on or after the date that is 1 year after
the date of enactment.
Sec. 1234. Part B special enrollment period and waiver of limited
enrollment penalty for Tricare beneficiaries
Current Law
Since 2001, military retirees and their eligible dependents
become eligible for Tricare for Life at the same time they
become eligible for Medicare. Tricare for Life functions
similarly to a supplemental insurance policy to Medicare and
provides coverage for authorized services not covered by
Medicare. Enrollment in Medicare Part B is required for access
to Tricare for Life. Prior to the legislation creating Tricare
for Life, many retirees had not enrolled in Part B, believing
that they would always have access to military medical
facilities. With the establishment of Tricare for Life and the
concomitant need to enroll in Medicare Part B, there was
concern over the potential imposition of significant penalties
for late enrollment in Part B. Subsequent legislation (Section
625 of the Medicare Prescription Drug, Improvement, and
Modernization Act of 2003 (MMA, P.L. 108-173) waived the Part B
enrollment penalty for eligible retirees who enrolled in Part B
prior to December 31, 2004.
Proposed Law
The provision will simplify enrollment in Medicare for
retired members of the armed forces and provide a grace period
for such individuals who have not yet enrolled in Medicare.
This provision creates a special 12-month enrollment period
in which military retirees (or their eligible dependents) who
have not yet enrolled in Medicare Part B can enroll in Part B,
thus becoming eligible for Tricare for Life, without incurring
a late enrollment penalty. The provision would apply to
elections made on or after the date of enactment of the Act.
This provision would also require the Secretary of HHS to
establish a method for providing rebates for late enrollment
penalties that were charged to certain disabled and end-stage
renal disease (ESRD) beneficiaries who enrolled during or after
January 2005 and before the month of enactment of this Act.
Sec. 1235. Exception for use of more recent tax year in case of gains
from sale of primary residence in computing part B income-
related premium
Current Law
Physician and outpatient services provided under Part B are
financed through a combination of beneficiary premiums,
deductibles, and federal general revenues. In general, Part B
beneficiary premiums equal 25% of estimated program costs for
the aged, with federal general revenues accounting for the
remaining 75%.
Beginning in 2007, higher-income enrollees pay a higher
percentage of Part B costs according to a sliding scale.
Beneficiaries with incomes above $85,000 for and individual
(and $170,000 for a couple) pay 35% to 80% of the standardized
Part B costs depending on their income reported to the IRS.
For purposes of determining the income-related premium,
beneficiaries experiencing major life events may apply to use a
more recent tax year for determination of the income-related
premium.
Proposed Law
This provision treats the sale of a primary residence as a
major life event for purposes of qualifying for the use of a
more recent tax year. This modification would apply to premiums
and payments for years beginning with 2011.
Sec. 1236. Demonstration program on use of patient decisions aids
Current Law
Current law does not explicitly address patient decision
aids, which are information tools to help patients understand
health care options, and make informed choices that take into
account their lifestyle, preferences, and beliefs. A related
concept is shared decision making (referred to by many other
names as well), meaning the cooperation of providers and
patients in making health care decisions.
Section 646 of the Medicare Prescription Drug, Improvement,
and Modernization Act of 2003 (MMA, P.L. 108-173) requires the
Secretary to carry out a Medicare quality demonstration
program, which would, among other things, encourage shared
decision making. Eligible entities include physician groups,
integrated health systems, or regional coalitions of the same.
Projects approved under this demonstration are expected to
achieve significant improvements in safety, effectiveness,
efficiency, patient-centeredness (i.e., shared decision
making), timeliness, and equity, the six aims for quality
improvement identified by the Institute of Medicine. Two
demonstrations have been approved and will begin in 2009. Two
others are in the final review process.
In addition, under their general authorities, the Agency
for Healthcare Research and Quality (AHRQ) and Centers for
Disease Control and Prevention (CDC) conduct research on the
application and use of shared decision making, including the
use of patient decision aids.
Proposed Law
This provision would require the Secretary to conduct a
Medicare demonstration program to determine if using patient
decision aids would improve beneficiaries' understanding of
their medical treatment options. The program would enroll not
more than 30 eligible providers, with preference given to
providers that have documented experience, and the necessary
information technology infrastructure and training, in using
patient decision aids. Eligible providers would be required to
provide follow-up counseling visits after beneficiaries have
viewed decision aids, to address questions about subsequent
medical care and the beneficiary's preferences. The Secretary
would have to provide for the development of one or more
billing codes and reimbursement for the follow-up counseling.
Eligible providers would be responsible for the costs of
selecting, purchasing, and delivering patient decision aids,
and reporting data on quality and outcome measures.
To carry out the program, the Secretary would be required
to use funds from the Federal Supplementary Medical Insurance
Trust Fund, and would be authorized to waive requirements under
SSA Titles XI (general and administrative provisions) and XVIII
(Medicare). Within 12 months of program completion, the
Secretary would be required to report to Congress regarding the
effects of the program on health quality, utilization of health
care services, and quality of life; and any recommendations for
legislation and administrative action.
Eligible providers would be (a) a primary care practice;
(b) a specialty practice; (c) a multispecialty group practice;
(d) a hospital; (e) a rural health clinic; (f) a Federally
Qualified Health Center (FQHC); (g) an integrated delivery
system; (h) a state cooperative entity that includes the state
government and at least one other health care provider which is
set up for the purpose of testing shared decision making and
patient decision aids. The provision would define ``patient
decision aid'' to mean ``an educational tool (such as the
Internet, a video, or a pamphlet) that helps patients (or, if
appropriate, the family caregiver of the patient) understand
and communicate their beliefs and preferences related to their
treatment options, and to decide with their health care
provider what treatments are best for them based on their
treatment options, scientific evidence, circumstances, beliefs,
and preferences''; and ``shared decision making'' would be
defined to mean ``a collaborative process between patient and
clinician that engages the patient in decision making, provides
patients with information about trade-offs among treatment
options, and facilitates the incorporation of patient
preferences and values into the medical plan.''
TITLE III--PROMOTING PRIMARY CARE, MENTAL HEALTH SERVICES AND
COORDINATING CARE
Sec. 1301. Accountable care organization pilot program
Current Law
No current provision. In April 2005, the Centers for
Medicare and Medicaid Services (CMS) initiated the Physician
Group Practice demonstration, which offers 10 large practices
the opportunity to earn performance payments for improving the
quality and cost-efficiency of health care delivered to
beneficiaries in fee-for-service Medicare.
Proposed Law
The Physician Group Practice (PGP) demonstration program
has shown promise in incentivizing physicians and other
providers to reduce health care costs and improve quality. The
ACO pilot program in the legislation builds on progress that
has been made to date in the PGP demonstration and gives CMS a
flexible platform on which to continue to test, adjust, and
expand the shared savings concept as an alternative to fee-for-
service payment.
A new section 1866E would be added to the Social Security
Act (SSA) to establish the accountable care organization (ACO)
pilot program. The Secretary would conduct a pilot program to
test different payment incentive models intended to reduce
growth in Medicare costs while improving health outcomes. The
pilot would promote accountability for services provided to a
Medicare patient population, coordinate Medicare's Part A and B
items and services, encourage investment in infrastructure and
the redesign of care processes, and reward high quality,
efficient physician practices.
The Secretary would set specific goals for the number of
ACOs, participating practitioners, and patient served in the
initial tests under the pilot program to ensure that the
program has sufficient size and scope to test the approach in a
variety of settings, including urban, rural and underserved
areas and, subject to certain qualifications, disseminate the
approach rapidly under a national basis. To the extent that the
Secretary finds a qualifying ACO to be successful in improving
quality and reducing costs, the Secretary would attempt to
attract at least 10% of all eligible providers to act as ACOs
and implement such mechanisms and reforms within 5 years of
enactment. If the Secretary further finds such ACO models to be
successful, the Secretary would seek to implement such
mechanisms and reforms on as large a geographic scale as
practical and economical.
A qualifying accountable care organization (qualifying ACO)
would be a group of physicians who are organized, at least in
part, for the purpose of providing physician services and meet
other specified standards. A qualifying ACO could include other
practitioners such as nurse practitioners or physician
assistants, a hospital or multiple hospitals, or any other
provider or supplier (furnishing Medicare covered services)
that are affiliated with the ACO under an arrangement
structured to coordinate patient care. A qualifying ACO would
meet the following requirements: (1) have a legal structure
that would allow the group to receive and distribute incentive
payments; (2) include a sufficient number of primary care
physicians (as determined by the Secretary); (3) report on
required quality measures in the specified form, manner, and
frequency (which may be for the group, for providers of
services, and suppliers or both); (4) report required data to
monitor and evaluate the pilot program; (5) provide notice to
applicable beneficiaries regarding the pilot program; (6)
contribute to a best practices network or website to share
strategies on quality improvement, care coordination, and
efficiency; (7) utilize patient-centered processes of care, and
(8) meet other criteria determined to be appropriate by the
Secretary.
Organizations qualifying as ACOs may include independent
practice association or other medical practice arrangements
which already provide services to Medicare beneficiaries
through fee-for-service Medicare or Medicare Advantage. An ACO
may continue to provide services to Medicare Advantage
enrollees in addition to providing services to enrollees in
fee-for-service Medicare through the ACO program.
Specific payment incentive models to be tested include: a
performance target model, a partial capitation model, and other
payment models.
Under the performance target model, a qualifying ACO would
receive an incentive payment if expenditures for applicable
beneficiaries are less than a target spending level or a target
rate of growth. The incentive payment would be made only if
savings are greater than would result from normal variation in
Medicare expenditures for Part A and B items and services. In
general the Secretary would establish a base amount increased
to the current year by an adjustment factor. The base amount
would equal the average total payments (or allowed charges)
under Parts A and B for applicable beneficiaries for whom the
qualifying ACO furnishes items and services. The base amount
may include Medicare Part D drugs and services if deemed
appropriate. The adjustment factor would equal an annual per
capita amount that reflects changes in expenditures from the
base period to the current year. The factor could be determined
as an amount or rate, determined on a national, regional, local
or organization-specific basis, and may be determined on a per
capita basis. It could also include a risk adjustment factor as
determined by the Secretary. The base amount would be
periodically recalculated.
A qualifying ACO that meets or exceeds annual quality and
performance targets for a year would receive an incentive
payment equal to a portion of the amount by which Medicare
payments are estimated to be below the performance target
(i.e., Medicare savings). The Secretary could establish a cap
on incentive payments for a year for a qualifying ACO.
Incentive payments to qualifying ACOs would be limited to
ensure that the aggregate expenditures do not exceed the amount
that the Secretary estimates would be expended for such ACO for
such beneficiaries if the pilot program were not implemented.
The Secretary would be able to incorporate reporting
requirements, incentive payments, and penalties related to the
physician quality reporting initiative (PQRI), electronic
prescribing, electronic health records, and other similar
physician payment initiatives under section 1848 of the SSA.
Alternative criteria than would otherwise apply could be used
when determining whether to make these payments so as to
streamline administration of the overlapping monitoring and
reporting requirements for ACOs and fee-for-service Medicare.
Also, these incentive payments would not be included in the
aggregate expenditure test described previously or in the
performance target model.
Under a partial capitation model, a qualifying ACO would be
at financial risk for some, but not all, of the Part A and B
items and services. The Secretary would be able to limit a
partial capitation model to ACOs that are highly integrated
systems of care and to ACOs capable of bearing risk. Payments
under the partial capitation model would be established in a
manner that does not result in spending more for such ACO for
such beneficiaries than would otherwise be expended if the
pilot were not implemented. Partial capitation would not
constrain beneficiaries' to seeing any particular provider;
beneficiaries would retain the ability to choose their doctor
or practitioner and could leave the ACO at any time.
The Secretary may develop other payment models that meet
the goals of this pilot program to improve quality and
efficiency. Payments under these models would be established in
a manner that does not result in spending more for such ACO for
such beneficiaries than would otherwise be expended if the
pilot were not implemented.
An applicable beneficiary would be an individual is
enrolled under part B and entitled to Part A benefits; is not
enrolled in a Medicare Advantage plan under part C or a PACE
(Program of All-Inclusive Care for the Elderly) program under
Section 1894 of the SSA; and meets other appropriate criteria.
The Secretary would monitor data on Medicare expenditures
and quality of services including a period of time after an
applicable beneficiary discontinues receiving services through
a qualifying ACO.
The pilot program would begin no later than January 1,
2012. An agreement with a qualifying ACO under this pilot would
cover a multi-year period of between 3 and 5 years. The
Secretary would be able to waive Medicare provisions and the
general provisions established under Title XI of the SSA only
insofar as necessary for implementation of this section.
The Secretary would be required to report performance
results to qualifying ACOs under the pilot program at least
annually. There would be no administrative or judicial review
of the (1) elements, parameters, scope, and duration of the
pilot program; (2) the selection of qualifying ACOs for the
pilot program; (3) the establishment of targets, measurement of
performance, determinations with respect to whether savings
have been achieved and the amount of savings; (4)
determinations regarding whether, to whom, and in what amounts
incentive payments are paid; and (5) decisions about the
extension of the program with successful ACOs, expansion of the
program to additional ACOs or transitional extension of the
existing physician group practice demonstration project. Also,
Chapter 35 of Title 44 of the United States Code (concerning
the coordination of federal information policy) would not apply
to this pilot.
The Secretary would evaluate the payment incentive model
for each qualifying ACO to assess the pilot's impact on
beneficiaries, providers of services, suppliers and the
program. The evaluation would be publicly available within 60
days of the date of completion of such report. The OIG would
monitor the operation of ACOs under the pilot program with
regard to violations of the Stark self referral prohibition
(Section 1877 of the SSA).
No later than 2 years after the date the first pilot
agreement is established, and every 2 years thereafter for six
years, the Secretary would report to Congress on the use of
authorities under the pilot program and its impact on
expenditures, access, and quality. Subject to monitoring of the
qualifying ACO, the Secretary would be able to extend the
duration of the agreement if (1) the ACO receives incentive
payments with respect to any of the first 4 years of the pilot
agreement and is consistently meeting quality standards or (2)
the ACO is consistently exceeding quality standards and is not
increasing spending under the program. The Secretary would be
able to terminate an agreement if the ACO did not receive
incentive payments or consistently failed to meet quality
standards in any of the first 3 years under the program.
Subject to the evaluation of the pilot, the Secretary would
be able to enter into agreements with additional qualifying
ACOs to further test and refine payment incentive models. The
Secretary would be able issue regulations to implement on a
permanent basis the components of the pilot program that are
beneficial to Medicare. However, to do so, the Chief Actuary of
the CMS would be required to certify that the expansion of the
program's components would result in estimated spending that
would be less than what spending would otherwise be estimated
to be in the absence of such expansion.
The Secretary would be able to enter into an agreement with
an organization participating in the physician group practice
demonstration as a qualifying ACO. Participation as a
qualifying ACO would be subject to rebasing and other
appropriate modifications, until the pilot program under this
section is operational.
The Secretary would be able to create separate incentive
arrangements (including using multiple years of data, varying
thresholds, varying shared savings amounts, and varying shared
savings limits) for different categories of qualifying ACOs to
reflect natural variations in data availability, variation in
average annual attributable expenditures, program integrity,
and other matters the Secretary deems appropriate.
The Secretary would be able to limit a qualifying ACO's
exposure to high cost patients in order to encourage the
participation of smaller accountable care organizations in the
pilot.
Nothing in this section would be construed as preventing a
qualified ACO from entering into an arrangement with an
Independence at Home medical practice or for providing home
based services for the treatment of beneficiaries who are
eligible for that program. Nothing in this section would be
construed as preventing qualifying ACOs participating in the
pilot program from negotiating similar contracts with private
payers.
The Secretary would not be able to enter into an agreement
with an entity to provide health care items or services under
the pilot program, or with an entity to administer the program,
unless such entity guarantees that it will not deny, limit, or
condition the coverage or provision of benefits under the
program, for individuals eligible to be enrolled under such
program, based on any health status-related factor described in
section 2702(a)(1) of the Public Health Service Act, including
health status, medical condition, claims experience, receipt of
health care, medical history, genetic information, evidence of
insurability, and disability.
Providers participating in the accountable care
organization (ACO) pilot program would have the option of
pursuing separate target growth rate for purposes of Medicare's
physician fee schedule (as amended under Section 1121) that is
applicable only that organization. No later than January 1,
2012, the Secretary would develop a method that would (1) allow
each ACO to have its own Medicare Part B expenditure targets
and updates that would be consistent with the methodologies
described above, and (2) provide that the target growth rate
applicable to other physicians would not apply to physicians to
the extent that their services are furnished through the ACO.
This method would apply beginning with 2012. In determining the
expenditure targets and updates for physicians in the ACO pilot
program, the Secretary could apply the difference in the update
on a claim-by-claim or lump sum basis and such a payment would
be taken into account under the pilot program.
Nothing in this section would be construed to compel an
organization to use that organization-specific target growth
rate methodology.
The program management account of CMS would be appropriated
$25 million for FY2010 through FY2014 and $20 million in FY2015
for the purposes of administering and carrying out the pilot
program, but not for payments for Medicare covered items and
services or for incentive payments.
Sec. 1302. Medical home pilot program
Current Law
The Tax Relief and Health Care Act of 2006 (P.L. 109-432),
as modified by the Medicare Improvements for Patients and
Providers Act of 2008 requires the Secretary to establish a
three-year demonstration in up to 8 states (with urban, rural
and underserved areas) to redesign the health care delivery
system to provide targeted, accessible, continuous and
coordinated family-centered care to high need Medicare
populations with chronic or prolonged illnesses requiring
regular medical monitoring, advising, or treatment.
Over 83% of Medicare beneficiaries have a chronic illness
and over 95% of total spending in Medicare is linked to
chronically ill patients. The medical home concept envisions a
health care system where patient care is coordinated and
integrated through a provider-guided multidisciplinary team
enabled by a transformed practice setting. The practice would
manage patient-centered care across a variety of settings
according to the needs of the patient through the promotion of
continuous care relationships as well as application of the
chronic care model, use of evidence based-medicine, care
coordination, and patient empowerment. The idea has been
described as early as 1967 by the American Academy of
Pediatrics' Council on Pediatric Practice. The model has proven
to be successful in improving outcomes for patients with
chronic illnesses through improved care-coordination. Many
demonstration programs have demonstrated long term cost-savings
as well.
Proposed Law
This provision establishes a pilot program that builds on
the current medical home model program, as modified by MIPPA,
and allows for a broader paradigm beyond the model proposed by
the National Committee for Quality Assurance (NCQA). It directs
the Secretary to establish ``a community-based medical home
model'' in addition to the ``independent patient-centered
medical home model.'' Studies have demonstrated that such
alternative models using community care teams within the
medical home can achieve cost savings and quality improvements.
A new section 1866E would be added to SSA to establish the
medical home pilot program for the purpose of evaluating the
feasibility and advisability of reimbursing qualified patient-
centered medical homes for furnishing medical home services to
high need beneficiaries in a variety of areas, including urban,
rural, and underserved areas.
The pilot program would evaluate two medical home models
(1) the independent patient-centered medical home model and (2)
the community-based medical home model.
Independent Patient-Centered Medical Home. Patient-centered
medical home services would be those services that (1) provide
beneficiaries with direct, ongoing access to primary care or
principal care provided by a physician or nurse practitioner;
(2) coordinate the care provided to a beneficiary by a team of
individuals at the practice level across office, institutional
and home settings led by a primary care or principal physician
or nurse practitioner; (3) provide for all the patient's health
care needs or take responsibility for appropriately arranging
care with other qualified providers for all stages of life; (4)
provide continuous access to care and communication with
participating beneficiaries; (5) provide support for patient
self-management, proactive, and regular patient monitoring,
support for family caregivers, and coordination with community
resources; (6) integrate readily accessible, clinically useful
information on participating patients; and (7) implement
evidence-based guidelines and apply such guidelines to the
identified needs of beneficiaries over time and with the
intensity needed by such beneficiaries.
``Primary care'' would mean health care that is provided by
a physician or nurse practitioner who practices in the field of
family medicine, general internal medicine, geriatric medicine,
or pediatric medicine. ``Principal care'' means integrated,
accessible health care that is provided by a physician who is a
medical subspecialist that addresses the majority of the
personal health care needs of patients with chronic conditions
and for whom the subspecialist assumes care management.
Nothing in this provision would prevent a nurse
practitioner or a physician assistant from leading or
participating in a patient centered medical home so long as all
of the pilot program requirements are met and the nurse
practitioner or physician assistant is acting consistently with
state law.
Under the independent patient-centered medical home model,
the Secretary would make payments for medical home services
furnished by an independent patient-centered medical home to
targeted high need beneficiaries. An independent patient-
centered medical home would be a physician-directed or nurse-
practitioner-directed practice that is qualified to provide
beneficiaries with patient-centered medical home services and
meets such other requirements as the Secretary may specify. A
targeted high need beneficiary would be a high need beneficiary
who, based on a chronic disease risk score as specified by the
Secretary, is generally within the upper 50th percentile of
Medicare beneficiaries.
The Secretary would be required to determine an appropriate
method of ensuring that beneficiaries have agreed to
participate in the pilot program. The pilot program would begin
no later than 6 months after the date of the enactment of this
section. The Secretary would review alternative models for
standard setting and qualification and develop a process that
(1) establishes standards to enable medical practices to
qualify as patient-centered medical homes; and (2) provides for
the review and certification of medical practices as meeting
such standards.
The Secretary would establish a methodology for the payment
for medical home services furnished by independent patient-
centered medical homes. Under the payment methodology, the
Secretary would adjust payments to medical homes based on
beneficiary risk scores to ensure that higher payments are made
for higher risk beneficiaries. Moreover, the Secretary shall
pay independent patient-centered medical homes a monthly fee
for each targeted high need beneficiary who receives medical
home services through such medical home. The monthly fee would
be paid on a prospective basis. The amount of the monthly fee
would depend upon the clinical work and practice expenses
involved in providing the service; allow for differential
payments based on capabilities of the independent patient-
centered medical home; and use appropriate risk-adjustment in
determining the per beneficiary per monthly payment in a manner
that ensures that higher payments are made for higher risk
beneficiaries.
The pilot program would be designed to include the
participation of physicians in practices with fewer than 10
full-time equivalent physicians, as well as physicians in
larger practices, particularly in underserved and rural areas,
as well as federally qualified community health centers, and
rural health centers. A physician in a group practice that
participates in the Accountable Care Organizations pilot
program established in section 1866D would not be eligible to
participate in this pilot program, unless the pilot program is
expanded and made permanent.
Community-Based Medical Home. Under the community-based
medical home model (the ``CBMH model''), the Secretary would
make payments for the furnishing of medical home services by a
community-based medical home to a high need beneficiary. A CBMH
would be an appropriately certified nonprofit community-based
or state-based organization that provides beneficiaries with
medical home services under the supervision of and in close
collaboration with the primary care or principal care physician
or nurse practitioner or physician assistant designated by the
beneficiary as his or her community-based medical home
provider. A CBMH would employ community health workers,
including nurses or other non-physician practitioners, lay
health workers, or other appropriate persons that assist the
primary or principal care physician or nurse practitioner or
physician assistant in chronic care management activities, such
as teaching self-care skills, providing transitional care
services, and developing care plans. A CBMH would meet such
other requirements as the Secretary may specify. For this
model, a ``high need beneficiary'' would be an individual with
multiple chronic illnesses who requires regular medical
monitoring, advising, or treatment. The Secretary would
establish a process (1) to determine the necessary
qualifications for community-based or state-based organizations
to function as community-based medical homes; and (2) to
provide for the review and assessment of these qualifications
pursuant to criteria to be established by the Secretary.
The CBMH pilot program would start no later than 2 years
after the date of the enactment of this section. Each
demonstration site under the pilot program would operate for a
period of up to 5 years after the initial implementation phase.
In selecting sites for the CBMH model, the Secretary would give
preference to applications from geographic areas that propose
to coordinate health care services for chronically ill
beneficiaries across a variety of health care settings,
practices with fewer than 10 physicians, rural health clinics,
and rural health clinics. Preference may also be given to
applications for models that include the collaboration of other
payors to provide medical homes services; or to states that
propose to use the medical home model to coordinate health care
services for chronically ill individuals enrolled under Title
XIX of the Social Security Act across a variety of health care
settings.
The Secretary would establish a methodology for the payment
for medical home services furnished under the CBMH model. Under
such payment methodology, the Secretary would make two separate
monthly payments for each high need beneficiary as follows: one
monthly payment to a community-based or state-based
organization and one monthly payment to the primary or
principal care practice for such beneficiary. The payments
would be made on a prospective basis. The amount of the monthly
fee would depend upon the clinical work and practice expenses
involved in providing the service and would include an
appropriate risk-adjustment to determine the monthly per
beneficiary payment amount.
The Secretary would be able to make available initial
implementation funding to a community-based or state-based
organization or a state participating in the pilot. The entity
would provide a detailed implementation plan that includes how
such funds will be used.
The Secretary would evaluate the pilot program to determine
the extent to which medical homes result in improvements in the
quality and coordination of health care services; reduction in
health disparities; reductions in preventable hospitalizations;
prevention of readmissions; reductions in emergency room
visits; improvement in health outcomes; increased patient
satisfaction; improved efficiency of care; and reductions in
health care expenditures. The evaluation would also examine the
feasibility and advisability of reimbursing medical homes for
medical home services under Medicare on a permanent basis. No
later than 60 days after the date of completion of the
evaluation, the Secretary would submit to Congress and make
available to the public a report on the findings of the
evaluation.
Subject to the results of the evaluation, the Secretary
would be able to issue regulations to implement, on a permanent
basis, one or more models, if, and to the extent that such
model or models, are beneficial to Medicare beneficiaries. The
Secretary would not be able to issue such regulations unless
the Chief Actuary of CMS certifies that the expansion of the
components of the pilot program would result in estimated
Medicare spending that would be no more than the level of
spending that the Secretary estimates would otherwise be spent
in the absence of such expansion.
During any month, the Secretary would not be able to make
payments under more than one model or through more than one
medical home under any model for the furnishing of medical home
services to an individual. Also, payments made under this pilot
are in addition to, and have no effect on the amount of,
payment for evaluation and management services made under this
title.
Chapter 35 of Title 44, United States Code would not apply
to the pilot.
For purposes of operational costs associated with the pilot
program (including the design, implementation, technical
assistance for and evaluation of such program), in addition to
funds otherwise available, $6 million for each of fiscal years
2010 through 2014 would be transferred from the Federal
Supplementary Medical Insurance Trust Fund (Part B trust fund)
to the CMS Program Management Account. Amounts appropriated
under this paragraph for a fiscal year would be available until
expended. In addition to funds otherwise available, $200
million for each fiscal year 2010 through 2014 for payments for
patient centered medical home services and $125 million for
each fiscal year 2012 through 2016 for CBMH services would be
available for CMS from the Part B trust fund. Amounts available
under this paragraph for a fiscal year would be available until
expended.
In addition to funds otherwise available, $2.5 million for
each of fiscal years 2010 through 2012 would be available to
CMS from the Part B trust fund for initial implementation
costs. Amounts available under this paragraph for a fiscal year
would be available until expended.
In addition to funds otherwise available for payment of
medical home services, there would also be available the amount
established for the existing Medicare Medical Home
Demonstration for the independent patient-centered medical home
model. The Medicare Medical Home Demonstration project is
repealed. The amendment made by this section would apply to
services furnished on or after the date of the enactment of
this Act.
Sec. 1303. Independence at home pilot program
Current Law
The Department of Veterans Affairs has been implementing a
Home Based Primary Care (HBPC) program since 1972. HBPC
provides comprehensive, interdisciplinary primary care in the
homes of veterans with complex medical, social, and behavioral
conditions for whom routine clinic-based care is not effective.
HBPC targets frail, chronically ill veterans who require
interdisciplinary health care teams, continuity, coordination
of care, and the integration of diverse services to cover their
complex medical, social, rehabilitative, and behavioral care
needs. These veterans need comprehensive, longitudinal home
care services as they age to maximize function, minimize
institutionalization, and maintain quality of life. HBPC
currently operates at over 130 locations in 48 states and
Puerto Rico, and has shown substantial reductions in hospital
days, nursing home days, and total costs of care.
Proposed Law
The Secretary would be required to conduct a Medicare pilot
program, beginning no later than January 1, 2012, to test a
payment incentive and service delivery model that utilizes
physician- and nurse-practitioner-directed home-based primary
care teams designed to reduce expenditures and improve health
outcomes in the provision of items and services to certain
high-cost, chronically ill Medicare beneficiaries. The pilot
would test whether such a model, which is accountable for
providing comprehensive, coordinated, continuous, and
accessible care to high-need populations at home and
coordinating health care across all treatment settings, would
result in reductions in preventable hospitalizations;
reductions in preventable readmissions; reductions in emergency
room visits; improvements in health outcomes; improvements in
the efficiency of care, such as by reducing duplicative
diagnostic and laboratory tests; reductions in Medicare costs;
and improvements in beneficiary and family caregiver
satisfaction, among others.
The Secretary would enter into agreements with qualifying
Independence at Home Medical Practices, legal entities
comprised of an individual physician or nurse practitioner or
group of physicians and nurse practitioners who are certified
or have experience and training in providing home-based primary
care services to high cost chronically ill beneficiaries. The
provision would not prohibit Practices from including
participating practitioners that are affiliated with the
medical practice under an arrangement structured so that such
provider or practitioner would participate in the pilot program
and share in any of its savings.
Practice teams, comprised of physicians, nurses, physician
assistants, pharmacists, and other health and social services
staff, as appropriate, would make in-home visits and carry out
plans of care tailored to the beneficiary's chronic conditions
to achieve the pilot program's objectives. The teams would also
report the clinical and quality of care outcomes as determined
by the Secretary. The Secretary would design the pilot program
to include the participation of physician and nurse
practitioner practices with fewer than 10 full-time equivalent
physicians, as well as physicians in larger practices,
particularly in underserved rural areas. A home-based primary
care team could be led by a nurse practitioner or physician
assistant, if he or she complies with the requirements of this
provision and acts consistently with state law.
Practices would be expected to spend at least 5% less than
a target spending level or a target rate of growth. A practice
could receive 80% of savings in excess of 5% if Medicare
expenditures for applicable beneficiaries are at least 5%
greater than would result from normal variation in expenditures
for items and services covered under Medicare parts A and B
(and part D to the extent the Secretary decides to include such
costs). Target spending levels, savings thresholds, and limits
on shared savings amounts for each practice may be established
by the Secretary, and would be based upon the size of the
practice, characteristics of the enrolled individuals, and
other factors the Secretary would determine to be appropriate.
Practices could receive interim payments for geriatric
assessments and monthly care coordination services, as
determined by the Secretary. But those payments, or a fraction
of them, may be recouped by the Secretary in the event that the
practice does not achieve the required savings so as to ensure
that no practice receives more payments under the pilot program
than Medicare otherwise would have paid for the services in the
absence of the pilot program. To participate, a practice would
be required to demonstrate to the Secretary that it is able to
assume financial risk for the 5% savings requirement. The
Secretary must limit payments for shared savings to each
practice so that aggregate expenditures for applicable
beneficiaries, including shared savings payments, would not
exceed the amount that would have been expended for such
practice if the pilot program had not been implemented.
An applicable beneficiary would be defined as an individual
who:
(A) Is enrolled under Medicare part B and entitled to
benefits under part A;
(B) Is not enrolled in a Medicare Advantage plan C or
a Program for All-Inclusive Care for the Elderly
program;
(C) Is in the top 20% of Medicare patient health risk
scores;
(D) Has two or more chronic illnesses, including
congestive heart failure, pulmonary disease, ischemic
heart disease, stroke, Alzheimer's disease, among
others specified in the provision, which would result
in high Medicare costs when in combination with one or
more of the specified diseases;
(E) Had a non-elective hospital admission within the
past 12 months;
(F) Has received acute or subacute rehabilitation
services;
(G) Has two or more functional dependencies requiring
the assistance of another person (e.g., bathing,
dressing, toileting, walking, or feeding); and
(H) Fulfills other criteria as the Secretary
determines appropriate.
The Secretary would be required to publish eligibility
requirements for beneficiaries that are sufficiently clear to
be understood by beneficiaries and the individuals providing
services to them, and the Secretary would be required to
determine a method to ensure that beneficiaries' agreement to
participate in a Practice is voluntarily. Beneficiaries who do
agree to participate do not relinquish access to any Medicare
benefits as a condition of receiving services from a practice.
Agreements with practices under the program could cover a
3-year period. No physician or nurse practitioner participating
in the accountable-care organization pilot program or the
medical home pilot program would be eligible to participate in
this pilot program.
The Secretary would be required to give preference, in
selecting practices, to medical practices in high costs areas
of the country, that have experience in furnishing health care
services to applicable beneficiaries in the home, and that use
electronic medical records, health information technology, and
individualized plans of care. The Secretary could waive certain
provisions in the Social Security Act to implement this pilot
program.
To the extent practicable, at least two unaffiliated
practices would be established in the 13 highest cost states
and the District of Columbia, and in 13 additional states that
are representative of other regions of the United States and
include medically underserved rural and urban areas, as
determined by the Secretary.
The Secretary would be required to provide an annual
evaluation of each practice, which it would be required to make
publicly available within 60 days of the completion of the
report, to assess whether it achieved the minimum savings of 5%
and other goals of the program, and can terminate an agreement
with a practice if the practice did not meet those goals.
The Secretary would also be required to submit to Congress
and make publicly available, no more than 2 years after the
date the first agreement is entered into, and every second year
thereafter during the pilot program, a report on best practices
under the pilot program, and the impact of best practices on
expenditures, access, and quality.
Subject to the evaluation, the Secretary may enter into
additional agreements with practices to further test and refine
models with respect to qualifying practices. If the practice
models are beneficial to Medicare, as determined by the
Secretary, and if the Chief Actuary of the CMS certifies that
the model would result in estimated spending that would be less
than without the expansion, the Secretary may issue regulations
to implement, on a permanent basis, the independence at home
practice model.
For purposes of administering and carrying out the pilot
program, the provision would appropriate to the Secretary for
the CMS Program Management Account $5 million for each of
fiscal years 2010 through 2014 to administer and carry out the
pilot program (other than for payments for items and services
furnished under Medicare, shared savings and monthly fees, or
other related payments such as interim payments).
Sec. 1304. Payment incentive for selected primary care services
Current Law
Section 1833(m) of the Social Security Act provides bonus
payments for physicians who furnish medical care services in
geographic areas that are designated by the Health Resources
and Services Administration (HRSA) as primary medical care
health professional shortage areas (HPSAs) under section
332(a)(1)(A) of the Public Health Service (PHS) Act. In
addition, for claims with dates of service on or after July 1,
2004, psychiatrists furnishing services in mental health HPSAs
are also eligible to receive bonus payments.
The bonus payment equals 10% of what would otherwise be
paid under the fee schedule. HPSAs may be designated as having
a shortage of primary medical care, dental or mental health
providers. They may be urban or rural areas, population groups
or medical or other public facilities.
Proposed Law
The provision would establish payment incentives in
Medicare to promote primary care furnished by primary care
practitioners. For such services furnished on or after January
1, 2011, by a primary care practitioner, a payment incentive of
5% would be allowed (or 10% if the practitioner provides the
services predominately in an area that is designated as a
primary care health professional shortage area) and would be
paid from the Supplementary Medical Insurance Trust Fund.
Primary care services would be defined to mean physicians'
services as defined in section 1848(j)(5)(A) as well as
services furnished by another health care professional that
would be described above if furnished by a physician. A primary
care practitioner would be defined as (1) a physician or other
health care practitioner (including a nurse practitioner) who
specializes in family medicine, general internal medicine,
general pediatrics, geriatrics, or obstetrics and gynecology
and has allowed charges for primary care services that account
for at least 50% of the physician's or practitioner's total
allowed charges under section 1848, as determined by the
Secretary for the most recent period for which data are
available, or (2) a physician assistant who is under the
supervision of a practitioner described above.
There would be no administrative or judicial review
respecting (1) any determination or designation of the primary
care services payment incentive; (2) the identification of
services as primary care services for the purpose of this
payment incentive; or (3) the identification of a practitioner
as a primary care practitioner for the purposes of this payment
incentive.
The primary care services incentive payments would not be
taken into account in determining the additional payments for
physicians in health professions shortage areas or in physician
scarcity areas. Furthermore, any bonus payment to physicians in
health professions shortage areas or physician scarcity areas
would not be taken into account in computing incentive payments
for primary care services, nor would the primary care incentive
payments be taken into account in determining the amounts that
would otherwise be paid to physicians providing outpatient
critical access hospital (CAH) services.
Sec. 1305. Increased reimbursement rate for certified nurse-midwives
Current Law
In general, Medicare pays 80% of the reasonable charges
(the lesser of the actual charge for the services or the amount
determined by the fee schedule) for physician services covered
under Medicare Part B. However, Medicare payments for services
performed by certified nurse-midwives to Medicare beneficiaries
are currently limited to no more than 65% of the fee schedule
amount for the same service performed by a physician.
Proposed Law
In order to increase access to women's health services for
Medicare beneficiaries, the provision increases the
reimbursement for nurse-midwife services from 65% of the fee
schedule to 100%. The modification would apply to services
furnished on or after January 1, 2011.
Sec. 1306. Coverage and waiver of cost-sharing for preventive services
Current Law
In general, Medicare law authorizes the Secretary to cover
services for the diagnosis and treatment of illness, while
coverage of preventive services (i.e., services provided in the
absence of illness) has required legislation. Section 1861 of
the SSA requires coverage of a number of specified preventive
services under Part B (often with specified conditions for
coverage) in language interspersed throughout the section.
There is no definition of ``preventive services'' in the law
that refers to them collectively. Also, in Section 101 of the
Medicare Improvements for Patients and Providers Act of 2008
(P.L. 110-275), Congress provided administrative authority for
the Secretary to add coverage of new preventive services, under
certain conditions.
Section 1833(a) of the SSA establishes coinsurance for the
beneficiary, requiring Medicare to cover 80% of the costs of
covered services under Part B, with specified exceptions.
Section 1833(b) establishes an annual deductible for which the
beneficiary is responsible. These sections have been amended
over the years to waive coinsurance and/or the deductible for
many, but not all, covered preventive services.
Proposed Law
In order to increase access to and utilization of
preventive services in Medicare, this section eliminates co-
insurance and the application of any deductible for such
services. Subsection (a) of this section would add a new
subsection to SSA Section 1861, which would define Medicare
covered preventive services to mean a specified list of
currently covered services, and colorectal cancer screening
services regardless of the code applied, as provided in Section
1307 of this bill. The list would also include any new services
that were covered under the Secretary's administrative
authority. Coverage would be subject to all conditions and
limitations that apply to each listed service under current
law.
With respect to Medicare covered preventive services (as
defined by this bill), subsection (b) of this section would
amend Section 1833(a) of the SSA to require Medicare to pay
100% of their allowed charges. It would also amend several
additional SSA sections to require the waiver of coinsurance
for specified sigmoidoscopy and colonoscopy services, and, in
outpatient hospital settings, for diagnostic mammograms and
Medicare clinical preventive services. This subsection would
also amend Section 1833(b) of the SSA to waive the application
of the deductible for Medicare covered preventive services.
Finally, it would amend the SSA to remove the authority of
providers to charge coinsurance when providing Medicare covered
preventive services.
The amendments made by this section would apply to services
furnished on or after January 1, 2011. The Secretary would be
required, within 12 months of enactment, to report to Congress
regarding barriers faced by beneficiaries in accessing
abdominal aortic aneurysm screening and other recommended
preventive services, and to provide educational resources to
patients and physicians regarding risk factors for abdominal
aortic aneurysm.
Sec. 1307. Waiver of deductible for colorectal cancer screening tests
regardless of coding, subsequent diagnosis, or ancillary tissue
removal
Current Law
Section 1833(a) of the SSA establishes coinsurance for the
beneficiary, requiring Medicare to cover 80% of the costs of
covered services under Part B, with specified exceptions.
Section 1833(b) of the SSA requires the application of an
annual deductible, for which the beneficiary is responsible,
for some Part B services. Under current law, coinsurance is
applied to colorectal cancer screening services, but the
deductible is not.
Proposed Law
Current law prohibits the application of the Medicare Part
B deductible for screening colonoscopies. If, however, a
patient has a screening colonoscopy and the physician finds
polyps that need to be removed during the screening exam, it is
relabeled a diagnostic procedure and the deductible is applied.
This provision would amend Sections 1833(a) and 1833(b) of the
SSA (as amended by Section 1306 of this bill) to ensure that a
screening colonoscopy avoids the deductible and the coinsurance
regardless of whether the procedure becomes diagnostic. This
provision would apply to items and services furnished on or
after January 1, 2011.
Sec. 1308. Excluding clinical social worker services from coverage
under the Medicare skilled nursing facility prospective payment
system and consolidated payment
Current Law
The majority of services provided to beneficiaries in a
Medicare covered skilled nursing facility (SNF) stay are
included in the bundled prospective payment made to the SNF.
Certain services have been specifically excluded from SNF
consolidated billing. In these instances, Medicare will pay the
entity or practitioner providing the service directly.
Currently, the items and services provided by a clinical social
worker are included in the SNF consolidated billing.
Proposed Law
In order to improve access to mental health services for
Medicare beneficiaries in nursing facilities, items and
services provided by clinical social workers to Medicare
beneficiaries in a SNF would receive separate Medicare payment
on or after July 1, 2011. This treatment would be equivalent to
the billing rules for psychiatrists and psychologists employed
under current law.
Sec. 1309. Coverage of marriage and family therapist services and
mental health counselor services
Current Law
Section 1861(s)(2) of the SSA (42 U.S.C. 1395x(s)(2))
defines services covered under the term ``medical and other
health services.'' These services include medical supplies,
hospital services, diagnostic services, outpatient physical
therapy services, rural health clinic services, home dialysis
services and supplies, antigens and physician assistant and
nurse practitioner services. Marriage and family therapists and
mental health counselors are not included under current law.
Proposed Law
In states that have licensed or certified marriage and
family therapists and mental health counselors, these
practitioners provide mental health services to people under
age 65. Few states did so when Medicare was first created in
1965. This provision updates Medicare coverage by allowing them
to treat Medicare beneficiaries as well, subject to state law.
The proposal would add two subcategories of services to be
covered under the term ``medical and health services.'' These
are (1) marriage and family therapists, and (2) mental health
counselors.
The proposal would stipulate the required qualifications
for a marriage and family therapist, and mental health
counselor in Medicare. It would define these providers'
services as the diagnosis and treatment of mental illnesses, as
permitted by his or her state license, if no other provider or
facility is also paid for those services. The proposal would
add a payment provision for marriage and family therapists, and
mental health counselors. The amount paid would be 80% of the
lesser of the actual charge for services or 75% of the amount
that would be paid for a psychologist's services. The proposal
would require the Secretary to consider confidentiality issues
while developing criteria allowing for direct payment of the
therapist and medical information sharing with the patient's
primary care physician or nurse practitioner. The proposal
would exclude marriage and family therapists and mental health
counselors from the prospective payment system for skilled
nursing facilities. The proposal would include marriage and
family therapy services and mental health counseling services
in the scope of services that rural health clinics and
federally qualified health centers can provide to Medicare
beneficiaries.
Sec. 1310. Extension of physician fee schedule mental health add-on
Current Law
By law, every five years CMS examines Medicare billing
codes under the physician fee schedule to determine whether
they are overvalued or undervalued. Subsequent to the most
recent evaluation, Medicare increased the rates for the codes
used by physicians to bill for ``evaluation and management''
(E/M) services (face-to-face visits with patients), effective
January 1, 2007. To maintain budget neutrality, rates for
certain other codes, including some used to bill for
psychotherapy services, were reduced.
The Medicare Improvements for Patients and Providers Act of
2008 (MIPPA; P.L. 110-275) increased Medicare payments under
the fee-schedule for psychotherapy services by 5% beginning on
July 1, 2008, and ending on December 31, 2009. Psychiatric
therapeutic procedures that involve insight oriented, behavior
modifying, or supportive psychotherapy or interactive
psychotherapy furnished in an office or other outpatient
facility setting or in an inpatient hospital or residential
care facility are paid at this higher amount.
Proposed Law
In order to maintain access to mental health services in
Medicare, this proposal would extend the increased payments
provided by MIPPA for psychotherapy services for an additional
two years (ending December 31, 2011).
Sec. 1311. Expanding access to vaccines
Current Law
Medicare Part B covers influenza, pneumococcal, and, for
individuals at increased risk, hepatitis B vaccinations. This
coverage includes both the costs of these vaccines and their
administration by recognized providers. Medicare Part D covers
all vaccines licensed by the FDA, and their administration,
when prescribed by recognized providers.
This split coverage arrangement is burdensome for patients
and providers and potentially dangerous. For vaccines covered
by Part D, beneficiaries may have to fill the vaccine
prescription at the pharmacy and carry it to the physicians'
office for administration.
Proposed Law
This provision transfers coverage for all vaccines to Part
B, simplifying the program and improving access for
beneficiaries.
Under this provision, coverage of vaccines currently
covered by Part D would be transferred to Medicare Part B. Part
B coverage vaccine coverage would include all federally
recommended vaccines, defined as any licensed vaccine that is
recommended by the Advisory Committee on Immunization Practices
(an advisory committee established by the Secretary, acting
through the Director of the Centers for Disease Control and
Prevention). The provision would also include all federally
recommended vaccines in the suite of Medicare covered
preventive services defined under section 1306 of this Act. The
provision would apply to vaccines administered on or after
January 1, 2011. Payment rates for vaccines under Medicare Part
B would be based on 106% of the vaccines' Average Sales Price,
with the exception of influenza vaccine. Payment rates for
influenza vaccine would remain unchanged from current law, at
95% of the Average Wholesale Price.
Sec. 1312. Recognition of certified diabetes educators as certified
providers for purposes of Medicare diabetes outpatient self-
management training services
Current Law
Diabetes Self Management Training (DSMT) is covered under
Medicare Part B pursuant to Section 1861(qq) of the SSA. DSMT
means educational and training services furnished to an
individual with diabetes by a ``certified provider,'' in an
outpatient setting, by an individual or entity who meets
specified quality standards. Certification of the need for such
services is required by the treating physician or qualified
non-physician practitioner. A certified provider for the
purpose of providing DSMT services is a physician, or other
individual or entity designated by the Secretary that, in
addition to providing diabetes outpatient self-management
training services, provides other items or services for which
payment may be made under this title.
Proposed Law
Diabetes self-management training teaches patients how to
manage diabetes to avoid and minimize subsequent health
problems. This proposal would amend Section 1861(qq) of the SSA
to designate certain certified diabetes educators as certified
providers of covered DSMT services.
Under the proposal, a ``certified diabetes educator'' is an
individual who: (1) is licensed or registered as a health care
professional by the state in which the services are performed;
(2) specializes in teaching individuals with diabetes to
develop the necessary skills and knowledge to manage the
individual's diabetic condition; and (3) is certified as a
diabetes educator by a recognized certifying body. A
``recognized certifying body'' means (1) the National
Certification Board for Diabetes Educators, or (2) a certifying
body for diabetes educators that is recognized by the Secretary
as authorized to grant certification of diabetes educators for
purposes of this proposal, pursuant to standards established by
the Secretary, if the Secretary determines that such board or
body meets the following requirements: (1) it is incorporated
and registered to do business in the United States; and (2) it
requires, as a condition of certification, that an individual:
(A) has a qualifying credential in a specified health care
profession; (B) has professional practice experience in DSMT
that includes a minimum number of hours and years of experience
in such training; (C) has successfully completed a national
certification examination offered by such entity; and (D)
periodically renews certification status following initial
certification.
Amendments made by this proposal would apply to outpatient
DSMT services furnished on or after the first day of the first
calendar year that is at least six months after the date of
enactment.
TITLE IV--QUALITY
Subtitle A--Comparative Effectiveness Research
Sec. 1401. Comparative effectiveness research
Current Law
The need for more and better information about which
clinical strategies work best and under what conditions has
been widely recognized by clinicians, patients, researchers and
policy makers. Most recently, comparative effectiveness
research was addressed in the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003 (MMA, P.L. 108-173)
and the American Recovery and Reinvestment Act (ARRA, P.L. 111-
5). Section 1013 of the MMA authorizes the Agency for
Healthcare Research and Quality (AHRQ) to conduct and support
research on the outcomes, comparative clinical effectiveness,
and appropriateness of health care items and services. In ARRA
Congress provided $1.1 billion for comparative effectiveness
research, with $400 million going to the National Institutes of
Health and $300 million to the Agency for Health Care Research
and Quality to support comparative effectiveness research
efforts at those agencies and $400 million to the Office of the
Secretary to (1) conduct, support, or synthesize research that
compares the clinical outcomes, effectiveness, and
appropriateness of items, services, and procedures that are
used to prevent, diagnose, or treat diseases, disorders, and
other health conditions; and (2) encourage the development and
use of clinical registries, clinical data networks, and other
forms of electronic health data that can be used to generate or
obtain outcomes data.
Proposed Law
The provision would establish a Center for Comparative
Effectiveness Research within the Agency for Healthcare
Research and Quality under title XI of the Social Security Act.
The Center would conduct, support, and synthesize research with
respect to the outcomes, effectiveness, and appropriateness of
health care services and procedures in order to identify the
manner in which diseases, disorders, and other health
conditions can most effectively and appropriately be prevented,
diagnosed, treated, and managed clinically.
The duties of the Center would be to (1) conduct, support,
and synthesize research relevant to the comparative
effectiveness of the full spectrum of health care items,
services, and systems, including pharmaceuticals, medical
devices, medical and surgical procedures, and other medical
interventions; (2) conduct and support systematic reviews of
clinical research, including original research conducted
subsequent to the date of the enactment of this section; (3)
continuously develop rigorous scientific methodologies for
conducting comparative effectiveness studies, and use such
methodologies appropriately; (4) submit to the Comparative
Effectiveness Research Commission (see below), the Secretary,
and Congress relevant reports produced by the Center or a
grantee or contractor of the Center; and (5) encourage, as
appropriate, the development and use of clinical registries and
the development of clinical effectiveness research data
networks from electronic health records, post-marketing drug
and medical device surveillance efforts, and other forms of
electronic health data.
The Center could secure information necessary to enable it
to carry out its duties directly from any department or agency
of the United States. Upon request of the Center, the head of
that department or agency would furnish the information to the
Center on an agreed upon schedule. In order to carry out its
functions, the Center would (1) utilize existing information,
both published and unpublished, where possible, collected and
assessed either by its own staff or under other arrangements;
(2) carry out, or award grants or contracts for, original
research and experimentation, where existing information is
inadequate; and (3) adopt procedures allowing any interested
party to submit information for the Center or the Commission's
to use in making reports and recommendations. The Comptroller
General would have unrestricted access to all deliberations,
records, and nonproprietary data of the Center and Commission,
immediately upon request, and both the Center and the
Commission would be subject to periodic audit by the
Comptroller General.
The Secretary would establish an independent Comparative
Effectiveness Research Commission to oversee and evaluate the
activities carried out by the Center to ensure that the
Center's activities result in highly credible research and
information produced from such research. The duties of the
Commission would include the following:
(1) Determine national priorities for research to be
conducted, supported or synthesized by the center, and
in making such determinations consult with a broad
array of public and private stakeholders, including
patients and health care providers and payers;
(2) Monitor the appropriateness of use of the
Comparative Effectiveness Research Trust Fund (CERTF)
(described below) with respect to the timely production
of comparative effectiveness research determined to be
a national priority;
(3) Identify highly credible research methods and
standards of evidence for such research to be
considered by the Center;
(4) Review the methodologies developed by the Center;
(5) Not later than one year after the date of the
enactment, enter into an arrangement under which the
Institute of Medicine of the National Academy of
Sciences would conduct an evaluation and report on
standards of evidence for such comparative
effectiveness research;
(6) Support forums to increase stakeholder awareness
and permit stakeholder feedback on the efforts of the
Center to advance methods and standards that promote
highly credible research;
(7) Make recommendations for policies that would
allow for public access of data produced under this
section, in accordance with appropriate privacy and
proprietary practices, while ensuring that the
information produced through such data is timely and
credible;
(8) Appoint a clinical perspective advisory panel for
each national research priority, which would consult
with patients and advise the Center on research
questions, methods and evidence gaps in terms of
clinical outcomes for the specific research inquiry to
be examined with respect to such priority to ensure
that the information produced from such research is
clinically relevant to decisions made by clinicians and
patients at the point of care;
(9) Make recommendations for the priority for
periodic reviews of previous comparative effectiveness
research and studies conducted by the Center;
(10) Routinely review processes of the Center with
respect to such research to confirm that the
information produced by such research is objective,
credible, consistent with standards of evidence
established under this section, and developed through a
transparent process that includes consultations with
appropriate stakeholders; and
(11) Make recommendations to the Center for the broad
dissemination of the findings of research conducted and
supported under this section that enables clinicians,
patients, consumers, and payers to make more informed
health care decisions that improve quality and value.
The members of the Commission would consist of the Director
of the Agency for Healthcare Research and Quality, the Chief
Medical Officer of the Centers for Medicare and Medicaid
Services, and 15 additional members who would represent broad
constituencies of stakeholders, including clinicians, patients,
researchers, third-party payers, and consumers of federal and
state beneficiary programs. At least 9 of the 17 members would
be practicing physicians, healthcare practitioners, consumers,
or patients. The members of the Commission would represent a
broad range of perspectives and collectively would have
experience in epidemiology, health services research,
bioethics, decision sciences, health disparities, and
economics. To ensure a diverse representation of the healthcare
community, at least one member would represent each of the
following: (1) patients, (2) healthcare consumers, (3)
practicing physicians, including surgeons, (4) other healthcare
practitioners engaged in clinical care, (5) employers, (6)
public payers, (7) insurance plans, and (8) clinical
researchers who conduct research on behalf of pharmaceutical or
device manufacturers. No more than 3 of the members of the
Commission could be representatives of pharmaceutical or device
manufacturers and these representatives could only be clinical
researchers as described in (8).
The Secretary would appoint the members of the Commission;
in considering candidates for appointment to the Commission,
the Secretary could consult with the Government Accountability
Office and the Institute of Medicine of the National Academy of
Sciences. The Secretary would designate a member of the
Commission, at the time of appointment, as Chairman and a
member as Vice Chairman for that term of appointment, except
that in the case of vacancy of the Chairmanship or Vice
Chairmanship, the Secretary could designate another member for
the remainder of that member's term. The Chairman would serve
as an ex officio member of the National Advisory Council of the
Agency for Healthcare Research and Quality. Of the members
first appointed, 8 would be appointed for a term of 4 years,
and 7 would be appointed for a term of three years.
Subsequently, each member of the Commission would be appointed
for a term of four years.
To enhance effectiveness and coordination, the Secretary
would be encouraged, to the greatest extent possible, to seek
coordination between the Commission and the National Advisory
Council of the Agency for Healthcare Research and Quality.
The bill includes provisions to protect against potential
conflicts of interest. In appointing the members of the
Commission or a clinical perspective advisory panel, the
Secretary or the Commission, respectively, would take into
consideration any financial interest and develop a plan for
managing any identified conflicts. When considering an
appointment to the Commission or a clinical perspective
advisory panel, the Secretary or the Commission would review
the expertise of the individual and the financial disclosure
report filed by the individual pursuant to the Ethics in
Government Act of 1978 for each individual under consideration
for the appointment, so as to reduce the likelihood that an
appointed individual would later require any pertinent waivers.
Prior to a meeting of the Commission or a clinical
perspective advisory panel, each member of the Commission or
the clinical perspective advisory panel who is a full-time
government employee or special government employee would
disclose any relevant financial interests to the Secretary. A
member of the Commission or a clinical perspective advisory
panel could not participate with respect to a particular matter
considered in a meeting of the Commission or the clinical
perspective advisory panel if the member (or an immediate
family member of the member) were to have a financial interest
that could be affected by the advice given to the Secretary
regarding the matter, excluding interests exempted in
regulations issued by the Director of the Office of Government
Ethics as too remote or inconsequential to affect the integrity
of the services of the government officers or employees to
which such regulations apply. The Secretary could grant a
waiver if the Secretary were to determine it necessary to
afford the Commission or a clinical perspective advisory panel
the essential expertise of the member. The waiver would permit
such a member to participate as a voting or non-voting member
with respect to a particular matter under consideration in a
Commission or a clinical perspective advisory panel meeting.
The number of waivers granted to members of the Commission
could not exceed one-half of the total number of members for
the Commission. However, no voting member of any clinical
perspective advisory panel would be in receipt of a waiver, and
no more than two nonvoting members of any clinical perspective
advisory panel would be serving under waiver. For purposes of
determining conflict of interest under this section, the term
``financial interest'' would mean a financial interest under
section 208(a) of title 18, United States Code.
While serving on the business of the Commission (including
travel time), a member of the Commission would be entitled to
compensation at the per diem equivalent of the rate provided
for level IV of the Executive Schedule, and while serving away
from home and the member's regular place of business, a member
could be allowed travel expenses, as authorized by the Director
of the Commission.
The Commission would transmit a copy of each report
submitted to the Secretary and would make the reports available
to the public.
The Commission could (1) appoint an executive director
(subject to the approval of the Secretary) and other personnel
as federal employees under section 2105 of title 5, United
States Code as may be necessary to carry out its duties
(without regard to the provisions of Title 5, United States
Code, governing appointments in the competitive service); (2)
seek assistance and support from appropriate federal
departments and agencies as might be required in the
performance of its duties; (3) enter into contracts or make
other arrangements for the conduct of the work of the
Commission, as may be necessary; (4) make advance payments, and
other payments that relate to the work of the Commission; (5)
provide transportation and subsistence for persons serving
without compensation; and (6) prescribe such rules and
regulations as it were to deem necessary with respect to the
internal organization and operation of the Commission.
Any research conducted, supported, or synthesized by the
Center would (1) be required to meet certain transparency,
credibility and access conditions; (2) consider advice given by
clinical perspective advisory panels; (3) consider stakeholder
input; and (4) take into account potential differences across
subgroups of populations. To ensure transparency, credibility,
and access, the research would meet the following conditions:
(1) the establishment of the agenda and the conduct of the
research would be insulated from inappropriate political or
stakeholder influence; (2) the methods of conducting the
research would be scientifically based; (3) all aspects of the
prioritization of research, conduct of the research, and
development of conclusions based on the research would be
transparent to all stakeholders; (4) the process and methods
for conducting such research would be publicly documented and
available to all stakeholders; and (5) throughout the process
of the research, the Center would provide opportunities for all
stakeholders involved to review and provide public comment on
the methods and findings of such research.
The research would meet a national research priority as
determined above and would consider advice given to the Center
by the clinical perspective advisory panel for the national
research priority.
The Commission would consult with patients, health care
providers, health care consumer representatives, and other
appropriate stakeholders with an interest in the research
through a transparent process recommended by the Commission.
Specifically, where deemed appropriate by the Commission, the
consultation would include (1) recommending research priorities
and questions, (2) recommending research methodologies, and (3)
advising on and assisting with efforts to disseminate research
findings. The Secretary would designate a patient ombudsman who
would serve as an available point of contact for any patients
with an interest in proposed comparative effectiveness studies
by the Center and ensure that any comments from patients
regarding proposed comparative effectiveness studies are
reviewed by the Commission.
Research falling under the activities of this Center would
(1) be designed, as appropriate, to take into account the
potential for differences in the effectiveness of health care
items and services used with various subpopulations such as
racial and ethnic minorities, women, different age groups
(including children, adolescents, adults, and seniors), and
individuals with different co-morbidities; and (2) seek, as
feasible and appropriate, to include members of such
subpopulations as subjects in the research.
The proposal would require public access to comparative
effectiveness information. Not later than 90 days after receipt
by the Center or Commission, as applicable, of a relevant
report made by the Center, Commission, or clinical perspective
advisory panel under this section, the appropriate information
contained in the report would be posted on the official public
Internet site of the Center and of the Commission, as
applicable. For purposes of this section, a relevant report
would be each of the following submitted by the Center or a
grantee or contractor of the Center: (1) any interim progress
report as deemed appropriate by the Secretary, (2) stakeholder
comments, and (3) a final report.
To disseminate and assist in the incorporation of
comparative effectiveness information, the Center would provide
for the dissemination of appropriate findings produced by
research supported, conducted, or synthesized under this
section to health care providers, patients, vendors of health
information technology focused on clinical decision support,
appropriate professional associations, and federal and private
health plans, and other relevant stakeholders. In disseminating
such findings the Center would (1) convey findings of research
so that they are comprehensible and useful to patients and
providers in making health care decisions; (2) discuss findings
and other considerations specific to certain sub-populations,
risk factors, and co-morbidities as appropriate; (3) include
considerations such as limitations of research and what further
research may be needed, as appropriate; (4) not include any
data that the dissemination of which would violate the privacy
of research participants or violate any confidentiality
agreements made with respect to the use of data under this
section; and (5) assist the users of health information
technology focused on clinical decision support to promote the
timely incorporation of such findings into clinical practices
and promote the ease of use of such incorporation.
The Center would develop protocols and strategies for the
appropriate dissemination of research findings in order to
ensure effective communication of the findings and the use and
incorporation of the findings into relevant activities for the
purpose of informing higher quality and better decisions
regarding medical items and services. In developing and
adopting the protocols and strategies, the Center would consult
with stakeholders concerning the types of dissemination that
would be most useful to the end users of information and could
provide for the utilization of multiple formats for conveying
findings to different audiences, including dissemination to
individuals with limited English proficiency.
The provision would establish a number of reporting
requirements:
Beginning not later than one year after the date
of the enactment, the Director of the Agency of Healthcare
Research and Quality and the Commission would submit an annual
report on the activities of the Center and the Commission and
research conducted under this section to Congress. Each report
would include a discussion of the Center's compliance with the
requirements for inclusion of subpopulations in research,
including any reasons for lack of compliance.
Not later than December 31, 2011, the Secretary
would submit to Congress an annual recommendation for a fair
share per capita amount described below for purposes of funding
the CERTF.
Not later than December 31, 2013, the Secretary,
in consultation with the Commission, would submit to Congress a
report on all activities conducted or supported under this
section as of such date. The report would include an evaluation
of the overall costs of such activities and an analysis of the
backlog of any research proposals approved by the Commission
but not funded.
The proposal would establish the Health Care Comparative
Effectiveness Research Trust Fund (``CERTF'') under the
Internal Revenue Code (the ``Code'') to carry out the
proposal's provisions relating to comparative effectiveness
research. For fiscal year 2010 and in each subsequent fiscal
year, amounts in the CERTF under section 9511 of the Internal
Revenue Code of 1986 would be available to the Secretary to
carry out this section without the need for further
appropriations and without fiscal year limitation.
Nothing in this section would be construed to permit the
Commission or the Center to mandate coverage, reimbursement, or
other policies for any public or private payer.
For information regarding the establishment and financing
the Comparative Effectiveness Research Trust Fund, see section
1802.
The bill includes several limitations on the use of
comparative effectiveness research. The proposal includes a
rule of construction stating that nothing in the section would
be construed to permit the Commission or the Center to mandate
coverage, reimbursement or other policies for any public or
private payer. A separate provision states that in no case
could any research conducted, supported, or developed by the
Center, the Commission, or the Federal Coordinating Council for
Comparative Effectiveness Research be used by the federal
government to deny or ration care. In addition, CMS could not
use federally funded clinical comparative effectiveness
research data to make coverage determinations for medical
treatments, services, or items under the Medicare program on
the basis of cost.
This section specifies that the work performed by the
Commission or the Center should be performed in close
collaboration with the specialty colleges and academies of
medicine because these organizations have important expertise
to be considered when formulating a research agenda. In
addition, these same organizations are critical to the
dissemination of new research.
Subtitle B--Nursing Home Transparency
Part 1--Improving Transparency of Information on Skilled Nursing
Facilities and Nursing Facilities
Sec. 1411. Required disclosure of ownership and additional disclosable
parties information
Current Law
In general, Medicare and Medicaid require that skilled
nursing facilities (SNF) and nursing facilities (NFs) be
administered in a manner that maintains residents' well-being
and safety. SNFs and nursing facilities are also required to
report certain changes in ownership or controlling interest; in
those individuals who are officers, directors, agents or
managing employees; in the corporation, association or other
company responsible for facility management; or when a change
occurs in the SNF or nursing facility administrator position.
SNFs and nursing facilities also are required to disclose
ownership and other information as a condition of
participation, and of certification or re-certification. In
general, administrators must meet standards established by the
Secretary.
Under Title XI of the Social Security Act, Section 1124, a
person is considered to have an ownership or controlling
interest, directly or indirectly, when (1) they own 5% or more
of an entity, or they hold a whole or part of any mortgage,
deed of trust, note or other obligation secured by the entity
(nursing facility) or any property or assets that equal 5% of
the total property; (2) are an officer or director of the
entity, if the entity is organized as a corporation; or (3) are
a partner in the entity if it is organized as a partnership. To
a limited extent as determined feasible by the Secretary,
nursing facility entities also are required to report other
ownership and control interests for any persons named as owners
or having a control interest.
Proposed Law
In recent years it has become clear that, when nursing home
quality problems arise, state and federal regulators are
increasingly unable to effectively and quickly investigate
complex webs of interlocking corporate relationships and
identify and hold accountable nursing home owners and others
who are responsible for these quality of care problems. Current
disclosure and reporting rules for nursing homes are
inadequate, failing to require that nursing homes divulge key
ownership and non-ownership relationships with persons and
entities that are in a position to control the resources and
operations essential to good resident care are inadequate. The
proposed provisions in Section 1411, which call for nursing
homes to divulge those persons and entities that are in a
position to make decisions about the operation, management and
financing of services for resident care, will restore a measure
of appropriate public accountability.
This provision would amend Section 1124 to require SNFs and
nursing facilities to make available upon request by the
Secretary, the Health and Human Services Office of the
Inspector General (OIG), the state where the entity is located,
and the state long-term care ombudsman, information on
ownership (including direct and indirect ownership),
information on additional disclosable parties and information
describing the governing body and organizational structure of
the facility. SNFs and nursing facilities would be required to
update disclosure information whenever changes occur.
Information would need to be made available to the Secretary,
OIG, the state where the entity is located, the state long-term
care ombudsman and members of the public upon request until
such time as this information became available publicly in
accordance with final regulations promulgated by the Secretary.
In addition, SNFs and nursing facilities would be required
to post prominent notices in facility lobbies that ownership
and additional disclosable party information are available upon
request.
Facilities would be required to disclose the identity of
and information on (1) each member of a facility's governing
body including their name, title, date of start, and period of
service for each SNF or nursing facility; (2) each person or
entity who is an officer, director, member, partner, trustee,
or managing employee, including their name, title, and period
of service; (3) each person or entity who is an additional
disclosable party; and (4) the organizational structure and
relationship of the organizational entities to each SNF or
nursing facility and each other for each ownership and
governing individual or entity.
To the extent practicable, the Secretary may allow SNFs and
nursing facilities, in a manner specified by the Secretary, to
submit information using existing reporting mechanisms on
ownership interest, governance, and organizational structure if
they already report such information to other oversight
agencies, such as to the Internal Revenue Services (IRS) using
Form 990, the Securities and Exchange Commission, the
Secretary, or through information otherwise submitted to any
other federal agency.
Ownership or controlling interest would include direct or
indirect interests through any number of intermediate entities
and would include owners of a whole or part interest in any
mortgage, deed of trust, note, or other obligation secured (in
whole or in part) by the entity or any of the property or
assets, if the ownership interest is at least 5%.
Not later than two years after enactment, the Secretary
would promulgate final regulations requiring SNFs and nursing
facilities to report, in a standardized format, information
about ownership, governing board, and organizational structure.
The final regulations would require that as a condition of
participation and payment, SNFs and nursing facilities certify
that reported information is current and accurate. These
regulations would take effect 90 days after the Secretary
published the final regulations in the Federal Register.
The Secretary would provide technical assistance and
guidance to states on how to adopt and implement the reporting
requirements in the standardized format. This provision would
not reduce, diminish, or alter any existing facility reporting
requirements.
The following definitions would apply to this provision:
(A) ``Additional disclosable party'' would be any
individual or entity who (i) exercises operational, financial,
or managerial control over the facility or any part of the
facility or provides policies or procedures for any facility
operations or provides financial or cash management services to
the facility; (ii) leases or subleases real property to the
facility; or owns a whole or part interest of at least 5% of
the total value of such real property; (iii) lends funds or
provides a financial guarantee to the facility of at least
$50,000; or (iv) provides management or administrative
services, management or clinical consulting services, or
accounting or financial services to the facility. Individuals
such as janitors, landscapers, or security guards, or routine
vendors who are independent third parties, and who do not or do
not have the ability to directly or indirectly exercise
operational or directional control over the facility are not
intended to be considered additional disclosable parties under
subparagraph (6)(A)(iv).
(B) The facility is defined as a ``disclosing entity'',
which is a SNF operating under Medicare or a nursing facility
operating under Medicaid.
(C) ``Managing employees'' include any employee, such as a
general manager, business manager, administrator, director, or
consultant, who directly or indirectly manages, advises, or
supervises any element of a SNF or nursing facility's
practices, finances, or operations.
(D) ``Organizational structure'' consists of the following:
(a) the corporations, the officers, directors, and shareholders
of corporations, who own at least 5% of the corporation; (b)
the limited liability companies, the ownership interest of
members and managers of limited liability companies (including
the percentage owned by each member and manager); (c) the
general partnerships, the general partners, the limited
partnerships, the general and limited partners who own at least
10% of the partnership; (d) a trust, the trustees of the trust;
(e) an individual, contact information for the individual; (f)
and any other person or entity, as the Secretary determines
appropriate.
Within one year of publication of the final regulations in
the Federal Register, the Secretary shall make ownership
disclosure and additional disclosable party information for SNF
and nursing facilities available to the public as determined by
the Secretary.
Sec. 1412. Accountability requirements
Current Law
There are no comparable requirements in current law for
SNFs and nursing facilities to implement compliance and ethics
training programs for their employees.
Proposed Law
For more than a decade the HHS Office of Inspector General
and other federal agencies charged with responsibility for
enforcement of federal law have emphasized the importance of
compliance plans. Yet not all nursing homes have voluntarily
implemented compliance and ethics programs. This section would
require that nursing homes develop such programs.
In addition, this section proposes that nursing homes
develop Quality Assurance and Performance Improvement (QAPI)
programs, which are vital for health care providers of all
types. QAPI programs are designed to make health care
organizations recognize and establish comprehensive systems
that aim to deliver patient-centered care encompassing all
individuals in an organization, from board to bedside, in an
environment that promotes and demonstrates measurable improved
outcomes for patients and families.
Within two years of the effective date of this provision,
the Secretary, in consultation with the HHS OIG, would
promulgate regulations for effective compliance and ethics
programs for operating organizations. These regulations may
include a model compliance program, and would permit the design
of the compliance and ethics programs to vary depending on an
organization's size. Larger operating organizations would have
more formal and rigorous programs with established written
policies and procedures to guide employees. Regulations also
would specifically address requirements for employees and
managers of multi-nursing home chains.
Thirty-six months after enactment of this provision, SNFs
and nursing facilities would be required to have complied with
regulations developed by the Secretary governing the operation
of compliance and ethics programs. The compliance and ethics
programs would need to be effective in preventing and detecting
criminal, civil, and administrative violations and in promoting
quality of care. Regulations may vary with the size of the
organization, such that larger organizations have a more formal
and rigorous program. Operating organizations (entities that
operate SNFs and nursing facilities) would be required to
comply with the compliance and ethics programs regulations, and
corporate-level management of multi-unit nursing home chains
would be specifically required to comply with the requirements
of compliance and ethics programs.
Section 1635 of this Act also requires compliance program
for Medicare and Medicaid providers. To prevent redundancy and
to ensure that nursing homes and SNFs have effective compliance
and ethics programs in place, the requirements of this section
for nursing facilities and SNFs are intended to supersede the
requirements in Section 1635.
Within three years after promulgation of final regulations,
the Secretary would be required to evaluate the compliance and
ethics programs and submit a report to Congress to determine if
the compliance and ethics programs led to changes in deficiency
citations, quality performance, or other patient care quality
metrics. The Secretary's report to Congress would include
recommendations to change the requirements of the compliance
and ethics program, as the Secretary determined appropriate.
Compliance and ethics programs would need to be reasonably
designed, implemented, and enforced to be generally effective
in preventing and detecting civil, criminal, and administrative
violations as well as in promoting quality of care, and would
include the following required components:
(1) Compliance standards and procedures that would
guide employees and other agents and would reduce
criminal, civil, and administrative violations as
defined under this Act;
(2) Responsibility by senior individuals within
operating organizations for overseeing compliance with
the standards and procedures the entity establishes for
their compliance and ethics program. These individuals
would have resources and authority to assure
compliance;
(3) Diligence in ensuring that individuals who are at
risk for engaging in criminal, civil, or administrative
violations under this Act are not delegated
responsibility for implementing or monitoring an
organization's compliance and ethics program;
(4) Effective communication of standards and
procedures to employees (and other agents), through
training programs or explanatory publications that
practically illustrate what is required;
(5) Assurance that the standards for their compliance
and ethics programs are met by using procedures to
detect criminal, civil, and administrative violations
of this Act. Organizations can use procedures such as
monitoring and auditing systems as well as installing a
reporting system that enables employees (and other
agents) to report violations by others without fear of
retribution;
(6) Appropriate disciplinary mechanisms that are
consistently followed to enforce the compliance and
ethics program standards. Operating organizations also
must demonstrate that they have used, where
appropriate, disciplinary measures for individuals
failing to detect offenses;
(7) Appropriate mechanisms to respond to detected
offenses and strategies to prevent future similar
offenses, including repayment of any funds to which an
organization was not entitled, and modification of
compliance and ethics programs to detect criminal,
civil, and administrative violations;
(8) Periodic reassessment of their compliance and
ethics program standards to ensure that the programs
continue to be effective as the organization and
facilities change.
Before December 31, 2011, the Secretary would be required
to establish and implement a quality assurance and performance
improvement (QAPI) program. The QAPI program would include
multi-unit chains. Under the QAPI program, the Secretary would
establish facility standards and provide technical assistance
to SNFs and nursing facilities on the development of best
practices to meet the QAPI standards through regulation. Within
one year after the Secretary promulgates such regulations, SNFs
and nursing facilities would be required to submit plans to the
Secretary describing how they will meet the QAPI standards and
implement best practices.
The Comptroller General of the Government Accountability
Office (GAO) would be required to conduct a study that examined
the following: (1) the extent to which corporations that
operate large numbers of SNFs and nursing facilities are
undercapitalized, taking into account ownership type (including
private equity and control interests) are undercapitalized; (2)
the effects of undercapitalization on quality of care,
including staffing and food costs; and (3) options to address
undercapitalization issues, such as requirements for surety
bonds, liability insurance, or minimum capitalization. Within
18 months after this provision became effective, GAO would
submit a report to Congress.
Section 1413. Nursing home compare Medicare website
Current Law
There is no requirement in current law for Medicare's
Nursing Home Compare website. The Nursing Home Compare website
was developed by the Centers for Medicare and Medicaid Services
(CMS) and launched in November 2002. The website was intended
to bolster the agency's efforts to improve SNF and nursing
facility quality of care and to make information on nursing
home quality more accessible for long-term care consumers and
their families. Since its launch, CMS has enhanced the website
by adding or improving quality measures and website navigation.
Medicare Nursing Home Compare includes national data on all
nursing facilities that participate in Medicare and Medicaid.
The data featured on Nursing Home Compare includes facility
ratings, selected results from survey and certification
inspections, and limited staffing information on SNFs and
nursing facilities.
Proposed Law
The federal nursing home quality website, Nursing Home
Compare, is visited annually by tens of thousands of
individuals looking for reliable, accurate information about a
suitable facility for a loved one. While Nursing Home Compare
is already a valuable resource, nursing home resident and their
families would benefit from additional information
This section requires that the Secretary ensure that the
Nursing Home Compare website (or a successor website) contain
additional information, in searchable form and displayed in a
manner that is prominent, easily accessible, and clearly
understandable for consumers, for SNFs and nursing facilities.
This information must include:
(1) Information on ownership and affiliated parties
as would be required under Section 1411 , Required
Disclosure of Ownership and Affiliated Parties
Information, that identifies SNF and SNF facility
chains' ownership, governing boards, and organizational
structure;
(2) Information on CMS's Special Focus Facility
facilities (or a successor program), including the
names and locations of facilities that since the
previous quarter that were: (a) newly enrolled in the
program; (b) enrolled but failed to significantly
improve; (c) enrolled and significantly improved; (d)
graduated from the program; and (e) have closed
voluntarily or been terminated by the Secretary;
(3) Staffing data for each facility, including
resident census, hours of care provided per resident
per day, staff turnover, and tenure. These data would
need to be displayed in formats that are clearly
understandable to consumers and would permit them to
compare staffing differences between facilities. This
staffing information also would need to assist
consumers in comparing an individual facility's
staffing with state and national facility averages by
providing: (a) concise explanations of how to interpret
data (i.e., plain English explanations of how to
interpret data on nursing home staff hours per resident
day), (b) differences between staffing categories and
their associated training requirements, (c) the
relationship between staff levels and quality of care,
and (d) an explanation that residents with greater care
needs can require greater staff levels or more staff
training;
(4) Links to state websites where state survey and
certification program information can be found,
including Form 2567 state inspection reports (or
successor forms) and facility correction plans or other
facility responses, along with information to guide
consumers in interpreting and understanding survey and
certification reports;
(5) The standardized complaint form developed by the
Secretary under Section 1415, which includes an
explanation of how complaint forms are used and how to
file a complaint with states' LTC ombudsman programs
and survey and certification programs;
(6) Summary information on the number, type,
severity, and outcome of substantiated complaints; and
(7) The number of adjudicated criminal violations by
the nursing facility or crimes committed by nursing
facility employees (a) that were committed inside a
facility; (b) for crimes or violations committed
outside a facility, the instances where these were
elder abuse, neglect, exploitation, criminal sexual
abuse of an elder, or other violations that resulted in
serious bodily injury; and (c) the number of civil
monetary penalties levied against the facility,
employees, contractors, and other agents.
The modifications of Nursing Home Compare described in this
section would become effective within one year after enactment,
except that the Secretary would ensure that Ownership and
Affiliated Parties, and Accountability Information as described
in Section 1411, would be included on the website within one
year of the date when those requirements were implemented.
The Secretary is further directed to undertake, within one
year after enactment, a process to review and modify the
Nursing Home Compare website that would address the accuracy,
clarity of presentation, timeliness, and comprehensiveness of
the information reported on the website, and modify or revamp
the website in accordance with the Secretary's findings. This
website review process would include consultation with state
LTC ombudsman programs, consumer advocacy groups, provider
stakeholder groups, and representatives of programs or groups
the Secretary determines appropriate.
To improve the public's access to timely information on
state survey and certification inspections, states would be
required to submit information, including any enforcement
actions, to the Secretary not later than the date when the
state nursing home surveyors sent that information to
facilities. Corrections to prior information submitted to the
state also would need to be submitted to the Secretary in a
timely manner. The Secretary is directed to update the Nursing
Home Compare website with the information from states' survey
and certification inspections as expeditiously as practicable,
but at least quarterly. This requirement would be required
within one year after this provision became effective.
The Secretary is also directed to conduct a Special Focus
Facility program for enforcement of requirements for SNFs and
nursing facilities that the Secretary identified as having
substantially failed to meet applicable requirements of this
provision. Under the Special Focus Facility program, the
Secretary would conduct a survey of each facility in the
program at least every six months.
Within one year of the effective date of this provision,
SNFs and nursing facilities would be required to make available
for any individual's review reports on surveys, certifications,
and complaint investigations for the past three years and to
post notices in prominent and accessible facility areas that
these reports are available for inspection. These reports would
need to exclude information identifying complainants or
residents.
The Secretary would be required to provide guidance to
states on how to establish Internet links to Form 2567 state
inspection reports (or successor forms), complaint
investigation reports, and facilities' correction plans or
other responses to Form 2567. This information would be
available on the state website for SNFs and nursing facilities.
These reports also would be required to exclude information
that identifies complainants or residents. In addition, the
Secretary shall, if possible, include such reports on Nursing
Home Compare.
States would be required to maintain a consumer-oriented
website that provided useful information on all SNF and nursing
facilities operating within that state. The information on each
facility would include Form 2567 state inspection reports (or
successor forms), complaint investigation reports, facilities'
plans of correction, and other information as determined useful
by the Secretary or the state for consumers to use in assessing
the quality of LTC options and the quality of care in
individual facilities.
Section 1414. Reporting of expenditures
Current Law
No comparable provisions are in current law that require
SNFs or nursing facilities to report expenditures.
Proposed Law
Experts on nursing home quality have determined that the
vast majority of nursing homes fail to provide adequate
staffing to provide proper care for residents. This provision
would make it possible for policymakers and other interested
parties to accurately determine and analyze how much funding a
facility or chain dedicates to staffing.
Within one year of the effective date of this provision,
the Secretary would consult with private sector accountants
with knowledge of SNF cost reports to re-design cost report
forms to separately capture wages and benefit expenditures for
direct care staff.
Beginning with cost reports submitted three years after the
effective date of this provision, SNFs would need to separately
report direct care staff wages and benefits including breaking
out, at a minimum, data for registered nurses, licensed
professional nurses, certified nurse assistants, and other
medical and therapy staff.
Within 30 months (2\1/2\ years) of the effective date of
this provision, the Secretary, in consultation with OIG, the
Medicare Payment Advisory Commission (MedPAC), and other
experts identified by the Secretary, would categorize SNF's
newly collected annual expenditure data for each facility,
regardless of payment source, into the following functional
accounts: spending on direct care services, including nursing,
therapy, and medical services; spending on indirect care,
including housekeeping and dietary services; capital assets,
including building and land costs; and administrative services
costs. The Secretary would establish procedures to make the
expenditure data submitted under this provision, readily
available to interested parties upon request, subject to
requirements established by the Secretary.
The Subcommittee on Health of the House Committee on Ways
and Means heard testimony recommending the creation of cost
centers as a way to improve nursing home financial
accountability at a hearing held on November 15, 2007. This
provision would make it possible for policymakers and other
interested parties to accurately determine and analyze how much
funding a facility or chain dedicates to one of the most
important aspects of resident care--staffing. Medicare cost
reports do not currently capture this information, with the
result that facilities may, if they wish, easily save money by
making decisions to cut staff. While research has established
that staffing levels below a certain threshold are detrimental
to good resident care, no consensus among policymakers has yet
been achieved about the level of staffing that should be in
place to assure good or optimal care. This new source of data
on what facilities spend on staffing, in conjunction with
Section 1416, which improves data on staffing levels, will
improve the quality and transparency of data on staffing levels
and funding and ease analyses of the relationship between
spending on staffing, staffing levels, and quality of care.
Section 1415. Standardized complaint form
Current Law
There are no provisions in current law requiring use of a
standardized complaint form. Oversight of nursing homes is a
shared federal-state responsibility. Based on statutory
requirements, CMS defines standards that nursing homes must
meet to participate in the Medicare and Medicaid programs and
contracts with states to assess whether homes meet these
standards through annual surveys and complaint investigations.
A range of statutorily defined sanctions is available to CMS
and the states to help ensure that homes maintain compliance
with federal quality requirements. CMS also is responsible for
monitoring the adequacy of state survey activities.
Every nursing home receiving Medicare or Medicaid payment
must undergo a standard survey not less than once every 15
months, and the statewide average interval for these surveys
must not exceed 12 months. During a standard survey, separate
teams of surveyors conduct a comprehensive assessment of
federal quality-of-care and fire safety requirements. In
contrast, complaint investigations generally focus on a
specific allegation regarding resident care or safety.
The quality-of-care component of a survey focuses on
determining whether (1) the care and services provided meet the
assessed needs of the residents and (2) the home is providing
adequate quality care, including preventing avoidable pressure
sores, weight loss, and accidents. Nursing homes that
participate in Medicare and Medicaid are required to
periodically assess residents' care needs in 17 areas, such as
mood and behavior, physical functioning, and skin conditions,
in order to develop an appropriate plan of care. Such resident
assessment data are known as the minimum data set (MDS). To
assess the care provided by SNF and nursing facilities,
surveyors select a sample of residents and (1) review data
derived from the residents' MDS assessments and medical
records; (2) interview nursing home staff, residents, and
family members; and (3) observe care provided to residents
during the course of the survey. CMS establishes specific
investigative protocols for state survey teams--generally
consisting of RNs, social workers, dieticians, and other
specialists--to use in conducting surveys. These procedural
instructions are intended to make the on-site surveys thorough
and consistent across states.
Complaint investigations provide an opportunity for state
surveyors to intervene promptly if problems arise between
standard surveys. Complaints may be filed against a home by a
resident, the resident's family, or a nursing home employee
either verbally, via a complaint hotline, or in writing.
Surveyors generally follow state procedures when investigating
complaints but must comply with certain federal guidelines and
time frames. In cases involving resident abuse, such as
pushing, slapping, beating, or otherwise assaulting a resident
by individuals to whom their care has been entrusted, state
survey agencies may notify state or local law enforcement
agencies that can initiate criminal investigations. States must
maintain a registry of qualified nurse aides, the primary
caregivers in nursing homes, that includes any findings that an
aide has been responsible for abuse, neglect, or theft of a
resident's property. The inclusion of such a finding
constitutes a ban on nursing home employment.
Proposed Law
Currently, there is inadequate documentation by the federal
government and by states of the number and type of complaints
that residents and families file, the processes used to examine
these complaints, and how and if they are resolved. Section
1415 is designed to address these flaws by requiring states to
establish more standardized, uniform processes and procedures
for handling and addressing complaints, and in so doing, to
improve resident care. This section also puts in place
whistleblower protections for nursing home employees who bring
a serious quality or safety issue to the attention of
supervisors or owners.
The Secretary would be required to develop a standardized
complaint form for SNF and nursing facility residents or their
representatives to use in filing complaints on SNFs and nursing
facilities to state survey and certification agencies and state
LTC ombudsman programs. States would be required to make the
new standardized complaint form available on request to SNF
residents, people acting on behalf of residents, and employees
or representatives of SNF and nursing facility employees.
States also would be required to establish a complaint
resolution process that ensures that SNF and nursing facility
residents, their representatives, or employees are not denied
access to residents or retaliated against for complaining, in
good faith, about quality of care or other issues in a
facility, regardless of whether residents, their
representatives or employees used the standardized form or some
other method to submit their complaint. The state complaint
resolution procedures would be required to include procedures
to ensure accurate tracking of complaints, determine the likely
severity of the complaint, investigate complaints, and ensure
that the identity of complainants would be kept confidential
and deadlines for responding to complaints and procedures that
would enable a complainant to track the complaint and
investigation.
The complaint resolution process would be required to
include whistleblower protection prohibitions against
retaliation to ensure that SNF and nursing facility employees
would not be penalized, discriminated, or retaliated against
because they or anyone they requested to act on their behalf,
in good faith, complained about the quality of care, services
provided, or other issues related to quality of care or service
in a nursing facility. This retaliatory prohibition applies
regardless of whether employees used the new standard or some
other complaint method. This protection against retaliatory
actions extends to any aspect of complainants' employment,
including discharge, promotion, compensation, terms,
conditions, or employment privileges, or termination of a
contract for services. SNFs would not be permitted to file
complaints or reports with state professional disciplinary
agencies against current or former employees because they (or
their agents), acting in good faith, submitted complaints about
quality of care or services in their employers' facility.
SNF and nursing facility employees who believed they were
penalized, discriminated, or retaliated against, or lost
service contracts because they submitted a quality of care
complaint against a SNF, would be able to seek remedy in an
appropriate U.S. district court. U.S. district courts would
have jurisdiction to grant complete relief, regardless of
citizenship or amount in question, but not limited to
injunction, such as reinstatement, compensatory damages
(reimbursement of lost wages, compensation, and benefits),
costs of litigation (including attorney's and expert witnesses'
fees), exemplary damages, and other relief deemed proper by the
court.
SNF and nursing facility employees' rights under this
provision would not be diminished by contract or other
agreement and would not diminish greater protection through
other federal or state laws, contracts, or agreements. Nothing
in this provision would prevent a resident, an agent acting on
their behalf, or an employee from submitting a complaint in any
manner and not necessarily by using the standardized complaint
form. SNFs and nursing facilities would be required to
conspicuously post in an appropriate location a sign as
specified by the Secretary that identifies employees' rights to
bring complaints against the facility. Individuals would be
considered to be acting in good faith when submitting
complaints if they believe that (1) their complaint is true and
(2) a violation has or may have occurred related to Medicare
provisions of the Social Security Act. These amendments would
apply one year after the effective date of this provision.
Section 1416. Ensuring staffing accountability
Current Law
No comparable provisions are in current law for SNF and
nursing facilities to report staff levels that are derived from
payroll data in a uniform format.
Proposed Law
Experts on nursing home quality have determined that the
vast majority of nursing homes fail to provide adequate
staffing to provide proper care for residents. This provision
would improve and standardize the reporting of nursing home
staffing levels. The additional reporting on staffing levels
would help policymakers and families better assess the impact
of staffing on quality of care, and determine which nursing
homes are adequately staffed.
Within two years after the effective date of this
provision, SNFs and nursing facilities would be required to
electronically submit to the Secretary direct care staffing
information, including agency and contract staff. In developing
specifications and direct care staffing data requirements, the
Secretary would consult with state long-term care ombudsman
programs, consumer advocacy groups, provider stakeholder
groups, employees and their representatives, and other parties
deemed appropriate by the Secretary. The direct care staffing
specifications would be based on payroll and other verifiable
data provided by SNFs and nursing facilities to the Secretary
in a uniform format, and reporting on contract staff would be
separate from information on employees. Specifications would
include (1) work categories of certified employees, including
registered nurses, licensed practical nurses, licensed
vocational nurses, certified nursing assistants, therapists, or
other medical personnel; (2) resident census data and
information on resident case mix; (3) an established reporting
schedule; and (4) employee tenure and turnover, as well as
hours of care provided by each certified employee category, per
resident per day.
Part 2--Targeting Enforcement
Section 1421. Civil money penalties
Current Law
Under Medicaid law, states have authority either by
regulation or law to impose money penalties of up to $10,000
for each day of noncompliance, deny payments, appoint temporary
management to bring facilities into compliance, and close
facilities if nursing facilities fail to meet state plan
requirements or have deficiencies that jeopardize residents'
health or safety. State expenses for enforcement may be funded
under the proper and efficient state plan administration
provision of the Medicaid Statute (Title XIX of the Social
Security Act). States also have authority to establish reward
programs for nursing facilities that deliver the highest
quality care to medical assistance patients and fund these
incentive rewards programs under Medicaid's proper and
efficient administration provisions.
Proposed Law
Multiple reports issued by the Government Accountability
Office have suggested that the penalties originally legislated
as part of the 1987 Nursing Home Reform Act, and which took
effect in 1994, may not be having a significant deterrent
effect for several reasons.
The provisions in this section are designed to update and
more effectively target civil money penalties (CMPs) authority
by focusing higher penalties on serious quality of care and
safety deficiencies that cause harm to residents, that put
their health in immediate jeopardy, or that are life-
threatening. Other modifications would allow facilities that
self-report and promptly correct deficiencies to receive a 50%
reduction in their CMP. Finally, the section aims to make more
timely collection of CMPs by allowing the federal government
and states to collect fines following an initial independent
dispute resolution process and to escrow these funds, pending
the results of any further appeals.
For SNFs and nursing facilities, the Secretary--and for
nursing facilities, the states--would have the authority to
impose per instance or per day civil money penalties for each
instance or each day of noncompliance (as determined
appropriate by the Secretary). The amounts of the per instance
CMPs would be the following: (1) in the case where a deficiency
is the direct proximate cause of a resident's death, the
penalty would not exceed $100,000; (2) in each case where a
facility is cited for a resident's actual harm or immediate
jeopardy, an amount equal to or greater than $3,050, but not
more than $25,000; and (3) in each case of any other
deficiency, penalty amounts per deficiency would range from not
less than $250 to not more than $3,050. The amount of the
applicable per day CMPs would be the following: (1) an amount
equal to or greater than $3,050 up to $25,000 where facilities
were cited for deficiencies that caused actual harm or
immediate jeopardy to residents; and (2) an amount between $250
and $3,050 for each case of any other deficiency.
Subject to limitations where reductions are prohibited if
SNFs and nursing facilities self-report and promptly correct
deficiencies within 10 calendar days after imposition of a CMP,
the Secretary--or the state if applicable--may reduce the
amount of the imposed CMP by up to 50%. The Secretary--or the
state if applicable--would be prohibited from reducing CMPs for
SNFs where the Secretary had previously reduced a penalty for
that facility in the last year, with respect to a repeat
deficiency. The Secretary--or the state if applicable--would be
prohibited from reducing CMPs for other deficiencies: (1) where
the deficiency was found to result in a pattern of harm or
widespread harm that immediately jeopardizes residents' safety
or health; or (2) where a deficiency resulted in the death of a
patient.
Aggregate CMP reductions would not be permitted to exceed
35% on the basis of self-reporting, on the basis of a waiver or
an appeal, or on the basis of both a waiver and an appeal. In
collecting CMPs, the Secretary--or the state if applicable--
must provide for the facility to participate in an independent
informal dispute resolution process that generates a written
record prior to penalty collection, and cannot impose
additional per-day penalties during the pendency of the dispute
resolution process; may provide an escrow account for fees to
be held beginning on the earlier of 90 days after fees are
imposed or the date the informal resolution process was
completed and may provide that penalty fees are held in escrow
accounts until appeals are resolved.
To implement independent information dispute resolution
(IIDR), the Secretary shall promulgate regulations pursuant to
notice and comment rulemaking under the Administrative
Procedures Act. Such regulations shall allow IIDR to be
conducted by an independent state agency (including an umbrella
agency, such as the Health and Human Services Commission), a
Quality Improvement Organization, or the state survey agency,
so long as the participants in IIDR are not involved in the
initial decision to cite the deficiency and impose the remedy.
Whoever is authorized to conduct IIDR must not have any
conflicts of interest. The regulations may address the type of
IIDR available to SNFs and NFs (desk review or in-person
meeting) and the circumstances of each; may determine whether
and when attorneys may represent the parties before IIDR; and
may limit the duration of in-person meetings, depending on the
scope and severity of deficiencies and other factors as
determined by the Secretary.
As under current informal dispute resolution (IDR)
processes, facilities may challenge only the factual basis of
the deficiency. They may not challenge issues related to
surveyors' compliance with the survey process or the scope and
severity of the deficiencies. Also as under current IDR
processes, states and the Secretary retain the right to reject
the IIDR recommendations and to cite deficiencies and to impose
remedies, as the states and the Secretary determine
appropriate. Finally, any person shall have the right to attend
and participate in the conference.
In situations where appeals are resolved in favor of
facilities, the Secretary--or the state if applicable--may
provide, if escrow accounts are established, that penalty fees
would be returned to facilities with interest; and may provide,
when facility appeals are unsuccessful, that some portion of
penalty amounts are used to support state LTC ombudsman
activities and to protect residents, including residents who
reside in facilities that voluntarily or involuntarily close or
are decertified.
The activities funded with CMPs may include using the
penalty funds to offset costs of relocating residents to home-
and community-based settings and other facilities, as well as
projects to support resident and family councils and other
consumer quality of care involvement (including joint training
of staff and surveyors, technical assistance for facilities
under quality assurance programs, the appointment of temporary
management, and other activities approved by the Secretary).
Provisions of the Social Security Act, Section 1128A
(except subsections (a) and (b)) and provisions that require a
hearing prior to imposing CMPs, also would apply to the CMPs
described here.
The CMP amendments would apply one year after the effective
date of the provision.
Section 1422. National independent monitor pilot program
Current Law
No comparable provisions are in current law for a national
independent monitor program.
Proposed Law
Promising work pioneered by the HHS OIG in the context of
agreements with nursing home chains that have chronic, severe
quality and safety problems, and which agree to a system of
close monitoring by independent contractors with expertise to
undertake ``root cause analyses'' provide a model for CMS, as
the principal regulatory agency, to develop a similar mechanism
of oversight.
Within one year of the effective date of this provision,
the Secretary in consultation with OIG would establish a pilot
program to develop, test, and implement use of an independent
monitor to oversee interstate and large intrastate SNF and
nursing facility chains. The Secretary would select SNF and
nursing facility chains to participate in a pilot independent
monitor program from among those chains that apply to
participate. The pilot independent monitor program would be
conducted over two years. The pilot independent monitor program
would commence within one year of the effective date of this
provision.
The Secretary shall select chains to participate in the
pilot program based on criteria selected by the Secretary,
including chains with one or more facilities in CMS's Special
Focus Facility program (or a successor program) or one or more
facilities with a record of repeated serious safety and quality
of care deficiencies.
An independent monitor that enters into a contract to
participate in the pilot program would have the following
responsibilities: conduct periodic reviews and root-cause
deficiency analyses of chains to assess their compliance with
state and federal laws and regulations; sustained oversight of
chains (whether public or private) to involve chain owners and
principal partners in facilitating compliance with state and
federal laws and regulations applicable to facilities; analyze
management structure, expenditure distribution, and nurse staff
levels of facilities of the chain compared to resident census,
staff turnover rates, and tenure; report findings and
recommendations with respect to reviews, analyses, and
oversight to the chain and facilities in the chain, to the
Secretary and to relevant states; and publish the results of
these reviews, analyses, and oversight.
Within 10 days of a chain receiving a finding (of
deficiency) from the independent monitor, the chain would be
required to submit a report to the independent monitor (1) that
outlines corrective actions the chain will take to address the
independent monitor's recommendations or (2) indicates that the
chain will not implement the recommendations and why it will
not do so.
Within 10 days after receiving the chain's response-report,
the independent monitor would be required to submit a report
containing the monitor's final recommendations to: the chain,
the chain's facilities, the Secretary, and the state or states
where the facilities in question operate.
The chain would be responsible for a portion of the costs
associated with the appointment of the pilot program
independent monitors. The chain would pay their portion of the
costs to the Secretary. The Secretary would determine the
amount and procedures for collecting the independent pilot
program costs. The Secretary would have authority to waive
provisions of the Medicare and Medicaid statutes (Titles XVIII
and XIX of the Social Security Act) if necessary to implement
the independent monitor pilot program. Appropriations necessary
to carry out the independent monitor pilot program would be
authorized.
The OIG would evaluate the independent monitor program
within six months of completion of the program. The OIG would
submit a report to Congress on the independent monitor program
that included recommendations for legislative and
administrative action.
Section 1423. Notification of facility closure
Current Law
Medicare and Medicaid law identifies patients' rights and
SNF and nursing home requirements in ensuring residents are
aware of their rights. Residents have specific discharge and
transfer rights, which include advance notification in cases
where facilities close.
Proposed Law
When nursing homes close, residents and their families are
left to quickly find an alternative setting for care, a task
that can be challenging under a tight timeframe and if there is
limited availability or variable quality in neighboring
institutions. This provision ensures that residents and their
families have proper advance notice of a closure, and that
residents are relocated prior to closure.
SNF and nursing facility administrators would be required
to issue written notification of intent to close to the
Secretary, LTC Ombudsman programs in the state where facilities
are located, facility residents, and facility residents' legal
representatives or other responsible parties. SNF and nursing
facility administrators would need to provide 60 days' notice
of their pending closure or, if closed by the Secretary, within
the time frame specified by the Secretary. SNF and nursing
facility administrators would be required not to admit new
patients on or after written notice of planned closure; and to
include in the closure notices the plans to transfer and
adequately relocate facility residents by a specified date
prior to closure that has been approved by the state, and which
also would include assurances that residents will be
transferred to the most appropriate facilities or settings in
terms of quality, services, and location as determined by
residents' needs, best interests, and preferences.
The state would ensure that before SNFs and nursing
facilities close, all residents would be relocated to
alternative settings, such as home- and community-based
settings or other facilities, taking into consideration the
needs and best interests of each resident. The Secretary may
determine the appropriate payment and whether and for how long
to continue payments to closing facilities during the period
after the notification of impending closure is submitted and
the date when residents are transferred to other facilities or
alternative settings. The notification of facility closure
amendments would apply one year after the effective date of the
provision.
Part 3--Improving Staff Training
Section 1431. Dementia and abuse prevention training
Current Law
Under Medicare law, the Secretary establishes SNF
requirements for nurse aide training and competency evaluation
programs and requirements for states to follow in evaluating
and re-evaluating these training programs. Similarly under
Medicaid law, the Secretary establishes nursing facility
requirements for nurse aide training and competency evaluation
programs and requirements for states to follow in evaluating
and re-evaluating these training programs.
Proposed Law
This provision would add dementia and abuse prevention
training to staff training requirements for SNF and nursing
facilities. The Secretary would revise initial nurse aide
training, competency, and evaluation program requirements to
include dementia management and patient abuse prevention
training. If determined to be appropriate, the Secretary also
may include dementia management training and patient abuse
prevention in ongoing nurse aide training, competency, and
evaluation program requirements. The dementia and abuse
prevention training amendments would apply one year after the
effective date of the provision.
It has been reported that the majority of older nursing
home residents have some form of psychiatric illness, with
dementia affecting 1 out of 5 residents. Timely recognition and
intervention are key to the optimal care of older adults with
dementia. Requiring appropriate training so that nursing home
staff are best equipped to manage the care of these patients is
important to ensuring good quality of care. This provision will
direct the Secretary to include dementia and abuse prevention
training of nursing home staff.
Section 1432. Study and report on training required for certified nurse
aides and supervisory staff
Current Law
Medicare and Medicaid law have provisions that govern
training for nurse aides for both SNF and nursing facilities.
These laws require the Secretary to establish requirements for
nurse aide training and competency evaluation programs as well
as parameters for states to use in monitoring these programs.
Proposed Law
Certified nurse aides and supervisory staff are typically
the primary caregivers in a skilled nursing facility. It is
important to know whether existing training requirements are
sufficient to ensure appropriate care for the patient
population in these facilities.
The Secretary would be required to conduct a study within
two years of the effective date of this provision on the
content of certified nurse aide and supervisory staff training
in SNFs and nursing facilities. The report shall include the
following: whether the 75 hours of initial nurse aide training
required should be increased and if so, what the required
number of initial training hours should be recommended
(including dementia related training); and whether the 12 hours
per year of ongoing nurse aide training should be increased and
what content changes are recommended. In assessing the number
of hours of initial nurse aide training required, the Secretary
would consult with states that already have increased the
number of hours of initial training above 75 hours. Within two
years from the effective date of this provision, the Secretary
would be required to submit a report to Congress on the
certified nurse aide and supervisory training requirements. The
report would include recommendations for legislative and
administrative action.
Section 1433. Qualification of director of food services of a Medicaid
nursing facility
Current Law
Medicaid law requires that participating nursing homes
provide dietary services that assure that the meals meet the
daily nutritional and special dietary needs of each resident.
Federal regulation requires the facility to employ a qualified
dietitian either full-time, part-time, or on a consultant
basis. If a qualified dietitian is not employed full-time, the
facility must designate a person to serve as the director of
food service who receives frequently scheduled consultation
from a qualified dietitian. A qualified dietitian is defined as
one who is registered by the Commission on Dietetic
Registration of the American Dietetic Association, or on the
basis of education, training, or experience in identification
of dietary needs, planning, and the implementation of dietary
programs.
Proposed Law
The provision would require that the full-time director of
food services of the facility, if not a qualified dietitian, be
accredited as a Certified Dietary Manager meeting the
requirements of the Certifying Board for Dietary Managers, or
as a Dietetic Technician, Registered meeting the requirements
of the Commission on Dietetic Registration, or have equivalent
military or academic qualifications, as specified by the
Secretary of HHS. This provision would take effect on the date
that is 180 days after enactment.
Subtitle C--Quality Measurements
Section 1441. Establishment of national priorities for quality
improvement
Current Law
There are no provisions in current law that require the
development of national priorities for performance improvement
(directed either at the Secretary of Health and Human Services
or the Agency for Healthcare Research and Quality).
Section 1890 of the Social Security Act, however, requires
the Secretary to identify and have in effect a contract with a
consensus-based entity, such as the National Quality Forum, to
perform the following duties: (1) synthesize evidence and
convene stakeholders to make recommendations, with respect to
activities conducted under this Act, on an integrated national
strategy and priorities for health care performance measurement
in all applicable settings; (2) provide for the endorsement of
standardized health care performance measures; (3) establish
and implement a process to ensure that endorsed measures are
updated or retired based on new evidence; (4) promote the
development of electronic health records that facilitate the
collection of performance measurement data; and (5) report
annually to Congress.
The National Quality Forum has been awarded this contract
and recently released its first report, Improving Healthcare
Performance: Setting Priorities and Enhancing Measurement
Capacity, in fulfillment of this statutory requirement.
Proposed Law
This provision would amend Title XI of the Social Security
Act, as amended by section 1401(a), by adding a new Part E--
Quality Improvement--Establishment of National Priorities for
Performance Improvement. Specifically, it would add a new
section 1191 to establish national priorities for performance
improvement.
This section would require the Secretary to establish and
periodically update (not less frequently than triennially)
national priorities for performance improvement. Specifically,
it would require the Secretary, when establishing and updating
national priorities, to solicit and consider recommendations
from multiple outside stakeholders.
This provision would require, with respect to the national
priorities for performance improvement, the Secretary to give
priority to areas in the delivery of health care services that
(1) address a large burden of disease, as specified; (2) have
the greatest potential to decrease morbidity and mortality in
the United States, as specified; (3) have the greatest
potential for improving the performance, affordability, and
patient-centeredness of health care; (4) address health
disparities across groups and areas; and (5) have the potential
for rapid improvement due to existing evidence or standards of
care.
For the purposes of this Section: (1) consensus-based
entity would mean an entity with a contract with the Secretary
under Section 1890 of the Social Security Act; and (2) quality
measure would mean a national consensus standard for measuring
the performance and improvement of population health, or of
institutional providers of services, physicians, and other
health care practitioners in the delivery of health care
services.
This provision would require the Secretary to provide for
the transfer, from the Federal Hospital Insurance Trust Fund
and the Federal Supplementary Medical Insurance Trust Fund, of
$2 million for each of the fiscal years 2010 through 2014. It
would also authorize the appropriation of $2 million for each
of the fiscal years 2010 through 2014 from any funds in the
Treasury not already appropriated.
It is the Committee's intent that the priorities
established by the Secretary will have wide applicability and
help direct health improvement activities across the nation's
health care system.
Section 1442. Development of new quality measures; GAO evaluation of
data collection process for quality measurement
Current Law
Section 1110(a)(1) of Title XI of the Social Security Act
provides general authority to appropriate such sums as may be
necessary for making grants to States and public and other
organizations and agencies for research that will help improve
the administration and effectiveness of the programs carried
out under the Social Security Act, among other things.
The Agency for Healthcare Research and Quality (AHRQ) has
significant existing statutory authorities with respect to the
development of quality measures. Specifically, the Agency's
mission, among other things, is to promote health care quality
improvement by conducting and supporting research that develops
and presents scientific evidence regarding all aspects of
health care, including methods for measuring quality and
strategies for improving quality (Section 901 of the PHSA).
Section 912 of the Public Health Service Act (PHSA)
requires AHRQ to provide support for public and private efforts
to improve health care quality, and that the role of the Agency
shall specifically include the ongoing development, testing,
and dissemination of quality measures, including measures of
health and functional outcomes and the compilation and
dissemination of health care quality measures developed in the
private and public sector. To comply with this last
requirement, the Agency has established the National Quality
Measures Clearinghouse, an online resource that compiles and
catalogues quality measures.
Finally, Section 917 of the PHSA requires AHRQ to
coordinate all research, evaluations, and demonstrations
related to health services research, quality measurement and
quality improvement activities undertaken and supported by the
Federal Government.
Proposed Law
This section would amend Part E of Title XI of the Social
Security Act, as added by section 1441, by adding two new
sections: section 1192: development of new quality measures,
and section 1193: GAO evaluation of data collection process for
quality measurement.
Robust, accurate, and appropriate measures of health care
quality are a critical component of improving the delivery
system and health outcomes. It is difficult to develop and
implement strategies to improve patient health without such
measures, but in many cases measures do not exist or have yet
to be fully developed. In other cases, measures do exist but
need to be updated or modernized. Putting additional resources
into quality measure development will speed the development of
new measures and address shortcomings of existing measures.
Section 1192. This section would require the Secretary to
enter into agreements with qualified entities to develop
quality measures for the delivery of health care services in
the United States. The Secretary would be authorized to carry
out these agreements by contract, grant, or otherwise. In
addition, this Section would require the Secretary to seek
public input and take into consideration recommendations of the
consensus-based entity with a contract with the Secretary under
Section 1890(a) of the Social Security Act. The Secretary would
be required, as specified, to determine areas in which quality
measures for assessing health care services in the United
States are needed.
Quality measures developed under these agreements would be
required to be designed (1) to assess outcomes and functional
status of patients; (2) to assess the continuity and
coordination of care and care transitions, as specified; (3) to
assess patient experience and patient engagement; (4) to assess
the safety, effectiveness, and timeliness of care; (5) to
assess health disparities as specified; (6) to assess the
efficiency and resource use in the provision of care; (7) to
the extent feasible, to be collected as part of health
information technologies supporting better delivery of health
care services; (8) to be available free of charge to users for
the use of such measures; and (9) to assess delivery of health
care service to individuals regardless of age.
This provision would also require the Secretary to make
proposed quality measures available to the public; would
authorize the Secretary to use amounts made available under
this Section to fund the testing of proposed quality measures
by qualified entities, as specified; and would authorize the
Secretary to use amounts made available under this Section to
fund the updating, by consensus-based entities, of quality
measures that have been previously endorsed by such an entity
as new evidence is developed (consistent with Section
1890(b)(3) of the Social Security Act).
Grants would be authorized to be made under this Section
only if an application for the grant would be submitted to the
Secretary as specified and the Secretary would be required to
ensure, before entering into agreements with qualified
entities, that the entity is a public, nonprofit or academic
institution with technical expertise in the area of health
quality measurement.
For purposes of carrying out this section, the Secretary
would be required to provide for the transfer, from the Federal
Hospital Insurance Trust Fund and the Federal Supplementary
Medical Insurance Trust Fund, of $25 million each year from
fiscal years 2010 through 2014. In addition, this section would
authorize the appropriation of $25 million for each of the
fiscal years 2010 through 2014 from any funds in the Treasury
not otherwise appropriated.
Section 1193. This Section would require the Comptroller
General of the United States to conduct periodic evaluations of
the implementation of the data collection processes for quality
measures used by the Secretary.
It would require the Comptroller General to determine: (1)
whether the system for the collection of data for quality
measures provides for validation of data as relevant and
scientifically credible; (2) whether data collection efforts
under the system use the most efficient and cost-effective
means in a manner that minimizes administrative burden on
persons required to collect data and that adequately protects
the privacy of patients' personal health information and
provides data security; (3) whether standards under the system
provide for an opportunity for physicians and other clinicians
and institutional providers of services to review and correct
findings; and (4) the extent to which quality measures are
consistent with requirements for quality measures developed
under this Act, as specified, or result in direct or indirect
costs to users of such measures.
This section would require the Comptroller General to
report to Congress and to the Secretary on the findings and
conclusions of the results of each such evaluation.
Section 1443. Multi-stakeholder pre-rulemaking input into selection of
quality measures
Current Law
None.
Proposed Law
The Medicare program is increasingly making use of health
care quality measures in administration of its payment systems.
As the program continues to evolve, the Committee expects this
trend will continue and that a larger portion of provider
payments will eventually become linked to performance on such
measures. For instance, the Accountable Care Organization pilot
program in section 1301 of this legislation will make extensive
use of quality measures.
Given the greater reliance on quality measures within
Medicare, the process for selecting such measures should be an
open and collaborative one. This section provides the Medicare
program with a process for engaging with a wide array of
stakeholders and interested parties, including patient advocacy
organizations, employers, private purchasers, and providers.
Such engagement will help ensure that Medicare selects the most
appropriate measures for each of its payment systems and
promote consistent use of measures among other stakeholders.
This section would amend section 1808 of the Social
Security Act by adding a new subsection (d): Multi-Stakeholder
Pre-Rulemaking Input into Selection of Quality Measures.
The new subsection would require the Secretary, not later
than December 1 before each year (beginning with 2011), to
publish a list of measures being considered for selection for
quality measurement by the Secretary in rulemaking with respect
to payment systems under Title XVIII of the Social Security
Act, as specified. This section would also require the
consensus-based entity that has entered into a contract under
section 1890 of the Social Security Act to convene multi-
stakeholder groups to provide recommendations on the selection
of individual or composite quality measures, for use in public
reporting of performance information or in public health care
programs. The section would also require the consensus-based
entity, not later than February 1 of each year (beginning with
2011), to transmit to the Secretary the recommendations of
these multi-stakeholder groups, as specified.
This section would require the consensus-based entity, in
convening multi-stakeholder groups, to provide for an open and
transparent process for the activities conducted pursuant to
such convening. This process would have to ensure that the
selection of representatives of multi-stakeholder groups
includes provision for public nominations for, and the
opportunity for public comment on, such selection. This section
would require the respective proposed rule to contain a summary
of the recommendations made by the multi-stakeholder groups
under this section, as well as other comments received
regarding the proposed measures, and the extent to which such
proposed rule follows such recommendations and the rationale
for not following such recommendations.
The provision would define the term ``multi-stakeholder
groups'' to mean, with respect to a quality measure, a
voluntary collaborative of organizations representing persons
interested in or affected by the use of such quality measure,
such as the following: (1) hospitals and other institutional
providers; (2) physicians; (3) health care quality alliances;
(4) nurses and other health care practitioners; (5) health
plans; (6) patient advocates and consumer groups; (7)
employers; (8) public and private purchasers of health care
items and services; (9) labor organizations; (10) relevant
departments or agencies of the United States; (11)
biopharmaceutical companies and manufacturers of medical
devices; (12) licensing, credentialing, and accrediting bodies.
For purposes of carrying out this section, the Secretary
would be required to provide for the transfer, from the Federal
Hospital Insurance Trust Fund and the Federal Supplementary
Medical Insurance Trust Fund under, of $1 million each year
from fiscal years 2010 through 2014. In addition, this section
would authorize the appropriation of $1 million for each of the
fiscal years 2010 through 2014 from any funds in the Treasury
not otherwise appropriated.
Section 1444. Application of quality measures
Current Law
Section 1886(b)(3)(B)(vii) of the Social Security Act
requires hospitals to submit specified quality data to the
Secretary in order to receive a full annual payment update.
Section 1886(b)(3)(B)(viii)(V) provides that beginning with
payments in fiscal year 2008, the Secretary shall add
additional quality measures that reflect consensus among
affected parties and, to the extent feasible and practicable,
shall include measures set forth by one or more national
consensus building entities.
Section 1833(t)(17)(A)(i) of the Social Security Act
requires hospitals to submit data on outpatient quality
measures to the Secretary in order to receive a full outpatient
department (OPD) fee schedule increase. In addition, section
1833(t)(17)(C)(i) requires the Secretary to develop measures
that reflect consensus among affected parties, and to the
extent feasible and practicable, to include measures set forth
by one or more national consensus building entities.
Section 1848(k) of the Social Security Act requires the
Secretary to implement a system for the reporting by eligible
professionals of data on specified quality measures. Section
1848(k)(2)(C)(i) requires that for 2010 and subsequent years,
the quality measures specified under this section will be such
measures selected by the Secretary from measures that have been
endorsed by the consensus-based entity with a contract under
section 1890(a) of the Social Security Act. Section
1848(k)(2)(C)(ii) provides an exception in the case of a
specified area or medical topic for which feasible and
practical measures have not been endorsed, stipulating that
such measures may be used as long as due consideration has been
given to measures that have been endorsed or adopted by a
consensus organization.
Section 1881(h)(1) of the Social Security Act requires
renal dialysis facilities to meet (or exceed) a total
performance score, based on quality measures as specified, in
order to receive full payment for services furnished on or
after January 1, 2012. In addition, section 1881(h)(2)(B)
requires the Secretary to specify measures that have been
endorsed by the consensus-based entity with a contract under
section 1890(a), and authorizes the Secretary, where endorsed
measures are not available, to use such measures provided that
due consideration has been given to measures that have been
endorsed or adopted by a consensus organization.
Section 1890 of the Social Security Act requires the
Secretary to identify and have in effect a contract with a
consensus-based entity, such as the National Quality Forum, to
perform certain duties. Included in these, at section
1890(b)(2) of the Social Security Act, is a requirement that
the consensus-based entity provide for the endorsement of
standardized health care performance measures, as specified.
Proposed Law
To the extent feasible, the Medicare program should use
measures of health quality that have been endorsed by a
consensus-based organization, such as the National Quality
Forum. The use of endorsed measures will help ensure that
Medicare is utilizing the most appropriate and robust measures,
while also using measures that have widespread support among
various health care stakeholders.
Generally, this section places requirements on the
Secretary when selecting quality measures for use in existing
quality programs for inpatient, outpatient, physician and renal
dialysis services. These requirements relate to the endorsement
of quality measures. However, the Committee recognizes it is
critical that the Medicare program maintain its independence
and retain the flexibility to use non-endorsed measures when it
deems necessary.
Specifically, this section would amend section
1886(b)(3)(B) of the Social Security Act to require the
Secretary to select measures for purposes of reporting data for
inpatient hospital services furnished during fiscal year 2012
and each subsequent year, that have been endorsed by the
consensus-based entity with a contract with the Secretary under
section 1890 of the Social Security Act. If feasible and
practical measures were not available, the Secretary would be
authorized to select a non-endorsed measure, providing the
Secretary gives due consideration to endorsed or adopted
measures. The Secretary would be required to submit non-
endorsed measures to the entity for consideration for
endorsement, and if the entity were to not endorse the measure,
and the Secretary were to continue to use the measure, the
Secretary would be required to include the rationale for its
continued use in rulemaking. This section would also amend
section 1833(t)(17) of the Social Security Act to require that
the provisions added to section 1886 (above) would also apply
to quality measures for covered outpatient department services.
This section would also amend sections 1848(k)(2)(C)(ii)
and 1881(h)(2)(B)(ii) of the Social Security Act, to require
the Secretary to submit non-endorsed measures for physicians'
services and renal dialysis services, respectively, to the
consensus-based entity for consideration for endorsement. It
would further require the Secretary, if the measure does not
gain endorsement and if the Secretary continues to use the
measure, to provide a rationale for continued use in
rulemaking.
This section would, by amending section 1890(b)(2) of the
Social Security Act, require the consensus-based entity with a
contract with the Secretary in section 1890 to explain the
reasons underlying non-endorsement of a given measure, and to
provide suggestions about changes to such measure that might
make such a measure potentially endorsable.
This section would apply to quality measures applied for
payment years beginning with 2012 or fiscal year 2012, as the
case may be.
Section 1445. Consensus-based entity funding
Current Law
Section 1890 of the Social Security Act requires the
Secretary to identify and have in effect a contract with a
consensus-based entity, such as the National Quality Forum, to
perform the following duties: (1) synthesize evidence and
convene stakeholders to make recommendations, with respect to
activities conducted under this Act, on an integrated national
strategy and priorities for health care performance measurement
in all applicable settings; (2) provide for the endorsement of
standardized health care performance measures; (3) establish
and implement a process to ensure that endorsed measures are
updated or retired based on new evidence; (4) promote the
development of electronic health records that facilitate the
collection of performance measurement data; and (5) report
annually to Congress.
Section 1890(d) of the Social Security Act provides for $10
million to fund the activities of the consensus-based entity
under contract in this section for each of fiscal years 2009
through 2012.
Proposed Law
This provision is needed to provide funding available under
CMS's current contract with the National Quality Forum to cover
additional expenses related to implementation of section 1441
of this legislation, regarding multi-stakeholder input on the
selection of quality measures.
This section would amend section 1890(d) of the Social
Security Act to provide for $10 million only for fiscal year
2009, and $12 million for each of the fiscal years 2010 through
2012.
Section 1446. Quality indicators for care of people with Alzheimer's
disease
Current Law
No provision.
Proposed Law
This provision would required the Secretary of HHS, acting
through the Agency for Healthcare Research and Quality (AHRQ),
to develop either directly or with commissioned projects, a
core set of quality indicators for the provision of medical
services to people with Alzheimer's disease and other dementias
and a plan for implementing the indicators to measure the
quality of care provided for people with these conditions by
physicians, hospitals, and other medical, residential, and home
care agencies and providers.
The Secretary would be required to submit a report to the
Committees on Energy and Commerce and Ways and Means of the
United States House of Representatives and the Committees on
Finance and Health, Education, and Pensions of the United
States Senate setting forth the status of their efforts to
implement the above mentioned requirements.
Section 1447. Study on five star quality rating system
Current Law
The Nursing Home Compare website was developed by the
Centers for Medicare and Medicaid Services (CMS) and launched
in November 2002. The website was intended to bolster the
agency's efforts to improve SNF and nursing facility quality of
care and to make information on nursing home quality more
accessible for long-term care consumers and their families.
Medicare Nursing Home Compare includes national data on all
nursing facilities that participate in Medicare and Medicaid.
The data in Medicare Nursing Home Compare include facility
ratings, selected results from survey and certification
inspections, and staffing information on all Medicare and
Medicaid SNFs and nursing facilities. Since its launch, CMS has
enhanced the website by adding or improving quality measures
and website navigation.
The Nursing Home Compare website includes a quality rating
system that gives each nursing home a rating of between 1 and 5
stars. Nursing homes with 5 stars are considered to have much
above average quality; nursing homes with 4 stars are
considered to be above average quality; nursing homes with 3
stars are considered to be average; nursing homes with 2 stars
are considered to be below average and nursing homes with 1
star are considered to be much below average.
Proposed Law
The Comptroller of the United States is required to conduct
a study on the Five-Star Quality Rating System (or a successor
program) established by CMS and to submit the results of this
study, together with recommendations, not later than 1 year
after the date of enactment to Congress and the Secretary of
HHS.
The study would be required to do the following:
(1) Determine whether the composite star rating
should be eliminated in favor of a multi-dimensional
system under which a star rating is assigned to each
individual domain;
(2) Determine whether an appeals process should be
implemented for the Five Star Rating System to address
situations in which questionable, inaccurate, or
incomplete data has been identified;
(3) Evaluate the appropriateness of any weighting
methodology used to adjust quality measures, including
an assessment of whether such methodology is validated,
whether it takes into account resident characteristics,
the appropriateness of the weighting of individual
quality measures, and whether the accuracy of
information to consumers would be enhanced if the
standard survey were weighted more heavily than the
complaint survey;
(4) Assess the appropriateness of the case-mix
adjustment methodology used to evaluate staffing
levels, along with the appropriateness of the staffing
levels established by CMS, to achieve a 5-star rating
given the absence of any existing federal nursing home
staffing guidelines or Medicare funding to support
these staffing levels;
(5) If the Comptroller General determines that such
target staffing levels are appropriate, evaluate, in
consultation with the Secretary of Health and Human
Services, the cost of modifying the Medicare Skilled
Nursing Facility Resource Utilization Groups to reflect
the costs to facilities of providing staffing at these
target levels;
(6) Evaluate how best to represent resident/consumer
satisfaction under the rating system, and review
approaches to report other facility-specific
characteristics to enable consumers to better identify
facilities that will meet their individual needs;
(7) Evaluate the impact of the rating system on
Medicare skilled nursing facilities and Medicaid
nursing facilities, including a review of potential
problems associated with inaccurate or incomplete data
and other unanticipated consequences reported by
facilities; and
(8) Assess whether the national program should be
suspended and replaced with a pilot program testing
potential nursing home quality rating systems in a
limited number of States.
Subtitle D--Physician Payments Sunshine Provision
Section 1451. Reports on financial relationships between manufacturers
and distributors of covered drugs, devices, biologics, or
medical supplies under Medicare, Medicaid, or CHIP and
physicians and other health care entities and between
physicians and other health care entities
Current Law
Under section 1128B(b) of the Social Security Act, referred
to as the federal anti-kickback statute, it is a felony for a
person to knowingly and willfully offer, pay, solicit, or
receive anything of value (i.e., ``remuneration'') in return
for a referral or to induce generation of business reimbursable
under a federal health care program. The statute prohibits the
offer or payment of remuneration for patient referrals, as well
as the offer or payment of anything of value in return for
purchasing, leasing, ordering, or arranging for, or
recommending the purchase, lease, or ordering of any item or
service that is reimbursable by a federal health care program.
Persons found guilty of violating the anti-kickback statute may
be subject to a fine of up to $25,000, imprisonment of up to
five years, and exclusion from participation in federal health
care programs for up to one year. However, a number of
statutory and regulatory ``safe harbors'' to the anti-kickback
statute protect various business arrangements from prosecution.
Safe harbors include certain types of investment interests,
personal services and management contracts, referral services,
space rental or equipment rental arrangements, warranties,
discounts, and employment arrangements. In 2003, OIG issued
``Compliance Program Guidance for Pharmaceutical
Manufacturers'' (68 Federal Register 23731), which stated that
pharmaceutical companies and their employees and agents often
engage in a number of arrangements that offer benefits to
physicians or others in a position to make or influence
prohibited referrals under the anti-kickback statute. Examples
of remunerative arrangements between pharmaceutical
manufacturers and parties in a position to influence referrals
that were cited by OIG included entertainment, recreation,
travel, meals, or other benefits in association with
information or marketing presentations, as well as gifts,
gratuities, and other business courtesies. OIG indicated these
arrangements potentially implicate the anti-kickback statute if
any one purpose of the arrangement is to generate business for
the pharmaceutical company.
Under section 1877 of the Social Security Act, the federal
prohibition on physician self-referrals, if a physician (or an
immediate family member of a physician) has a ``financial
relationship'' with an entity, the physician may not make a
referral to the entity for the furnishing of designated health
services (DHS) for which payment may be made under Medicare or
Medicaid, and the entity may not present (or cause to be
presented) a claim to the federal health care program or bill
to any individual or entity for DHS furnished pursuant to a
prohibited referral. ``Financial relationship'' is defined as
either an ownership or investment interest or a compensation
arrangement. An ownership or investment interest may be equity,
debt, or other means; however, section 1877(c) specifies that
an ownership interest does not include certain investment
securities which may be purchased on terms generally available
to the public and meet additional requirements, or that are
shares of certain regulated investment companies. A
compensation arrangement means an arrangement involving
remuneration between a physician or an immediate family member
of such physician and an entity. Section 1877(f) requires an
entity that provides covered services for which payment may be
made under Medicare to report to the Secretary information on
the entity's ownership, investment, and compensation
arrangements, including the covered items and services provided
by the entity, and the names and unique physician
identification numbers of all physicians who have an ownership
or investment interest in, or a compensation arrangement with
the entity, or whose immediate relatives have such an ownership
or investment interest or compensation relationship with the
entity.
Multiple states and the District of Columbia have enacted
legislation requiring pharmaceutical and other companies to
disclose gifts and payments made to physicians and other
entities. These state laws generally require annual disclosures
to the states of such gifts and payments. Certain categories of
gifts and payments are exempted from reporting requirements
under most of the state laws. For example, state laws may
exempt product samples intended for free distribution to
patients and gifts worth less than a certain amount. While
companies may make a voluntary disclosure of these gifts and
other payments, there are currently no similar federal
reporting requirements.
Proposed Law
The bill would add a new Section 1128H of the Social
Security Act to create certain reporting requirements
applicable to manufacturers or distributors of a drug, device,
biological, or medical supply for which payment may be made
available under Medicare, Medicaid, or the State Children's
Health Insurance Program, as well as hospitals or other
entities that bill Medicare.
Under the section, beginning in 2011, a manufacturer or
distributor that provides a payment or other transfer of value
to a covered recipient (e.g., a physician, a pharmacist, a
hospital, a medical school, or a group purchasing organization)
or a recipient's designee would be required to annually submit
specified information to the Secretary regarding the
recipients, any payments or other transfers of value, and
information about a provided drug sample. Payments or transfers
of value include, among other things, gifts, food, or
entertainment, travel or trips, honoraria, research funding or
grants, education or conference funding and consulting fees,
profit distribution, stock or stock option grant, or any
ownership or investment interest held by a physician in a
manufacturer (subject to exclusion), but do not include
payments or transfers of five dollars or less, a loan of a
covered device for a short-term trial period for evaluation
purposes, items or services provided under a contractual
warranty where the terms are specified in a purchase or lease
agreement, items given to a patient who is not acting in a
professional capacity, in-kind items for the provision of
charity care, a dividend or other profit distribution from or
ownership or investment interest in a publicly traded security
and mutual fund, compensation paid by a manufacturer or
distributor to an employee who works solely for a manufacturer
or distributor, and any discount or cash rebate. The
information submitted must include the aggregate amount of all
payments or transfers of value from manufacturers to covered
recipients, regardless of whether such payments or transfers
were individually disclosed. If a manufacturer or distributor
provides a payment to another entity or individual at the
request of or designated on behalf of a covered recipient, the
manufacturer or distributor must disclose the payment or
transfer under the name of the covered recipient.
Section 1128H would allow manufacturers and distributors to
delay submission of their reports to the Secretary of payments
and transfers of value made to covered recipients pursuant to
certain services furnished as part of a product development
agreement, or in connection with a clinical investigation of a
new drug, device, biological, or medical supply. The
information subject to delayed reporting would be considered
confidential and would not be subject to disclosure under the
Freedom of Information Act or other similar federal, state, or
local law until or after the date on which the information is
made available to the public.
Manufacturers and distributors that fail to submit the
required information in a timely manner in accordance with
regulations would be subject to a civil monetary penalty of at
least $1,000 but not more than $10,000 for each payment or
transfer of value not reported, up to a maximum of $150,000 for
each annual submission of information. Any manufacturer or
distributor that knowingly fails to submit information would be
subject to a civil monetary penalty of at least $10,000 but not
more than $100,000 for each payment or transfer of value, and
may not exceed $1 million or, if greater, 0.1% of the total
annual revenue of the manufacturer or distributor.
Each hospital or other health care entity, excluding a
Medicare Advantage organization, that bills the Secretary under
Medicare Part A or Part B would have to report on the ownership
shares (other than shares generally available to the public or
shares of certain regulated investment companies as described
in Section 1877(c) of the Social Security Act) of each
physician and the physician's immediate family members.
Hospitals and other entities that fail to submit the required
information in a timely manner in accordance with regulations
would be subject to a civil monetary penalty of at least $1,000
but not more than $10,000 for each ownership or investment
interest not reported. Any hospital or other entity that
knowingly fails to submit information would be subject to a
civil monetary penalty of at least $10,000 but not more than
$100,000 for each ownership or investment interest not
reported. The total amount of civil monetary penalties imposed
with respect to each annual submission of information may not
exceed $1 million or, if greater, 0.1% of the total annual
revenue of the entity. All funds collected by the Secretary
under section 1128H from the imposition of civil monetary
penalties would be used to carry out the requirements of the
section.
The section would require the Secretary to establish
procedures no later than September 30, 2011, and on June 30
each year after to ensure public availability of the submitted
information through an Internet website that is searchable, has
a clear and understandable format, and that meets various other
requirements. Manufacturer and distributors, hospitals, and
other entities that would be subject to reporting requirements
under 1128H would be responsible for the accuracy of the
information that is submitted to the Secretary and made
available on the website. The Secretary would be required to
establish procedures to ensure that a covered recipient has an
opportunity to submit corrections to these entities the
manufacturer with regard to information made public with
respect to the covered recipient. Under such procedures, the
corrections must be transmitted to the Secretary. Information
relating to drug samples and national provider identification
numbers would not be made available to the public by the
Secretary, but may be made available outside of the Department
of Health and Human Services for research or legitimate
business purposes pursuant to data use agreements.
Under the section, if a state attorney general has provided
notice to the Secretary of the intent to proceed on a specific
case and the Secretary has had an opportunity to bring an
action and has declined to do so, the attorney general of a
state would be permitted to bring an action against a
manufacturer or distributor in the state for a violation of the
section.
Section 1128H would require the Secretary to submit a
report to Congress no later than April 1 of each year,
beginning in 2011, that includes information submitted in the
preceding year by manufacturers and distributors and a
description of any enforcement actions taken to carry out the
section (including penalties imposed during the preceding
year). The Secretary would also be required to submit to
Congress a report on the results of the Disclosure of Physician
Financial Relationships surveys required pursuant to section
5006 of the Deficit Reduction Act of 2005. This report would be
submitted to Congress not later than 6 months after the date
such surveys are collected and would be made publicly available
on an Internet website of the Department of Health and Human
Services. In addition, no later than April 1 of each year,
beginning in 2011, the Secretary would be required to submit to
states a report that includes information submitted by
manufacturers and distributors in the preceding year, as well
as other information.
Additionally, beginning on January 1, 2011, Section 1128H
would preempt any law or regulation of a state or its political
subdivision that requires a manufacturer or distributor to
disclose or report information regarding a payment or other
transfer of value to a covered recipient, in accordance with
the section. However, the section would not preempt state laws
or regulations under which (A) the disclosure or reporting of
information is not of the type required to be disclosed or
reported under Section 1128H, (B) the information reported is
required to be disclosed or reported to a federal, state, or
local governmental agency for public health surveillance,
investigation, or other public health purposes or health
oversight purposes, or (C) the state requires the discovery or
admissibility of the information in a criminal, civil, or
administrative proceeding.
Subtitle E--Public Reporting on Health Care-Associated Infections
Section 1461. Requirement for public reporting by hospitals and
ambulatory surgical centers on health care-associated
infections
Current Law
Current law does not, in general, require the reporting of
health care-associated infections (HAIs), although such
reporting is required in a number of states. Several provisions
in current federal law have established programs that are
somewhat related.
First, Section 5001(c) of the Deficit Reduction Act (P.L.
109-171) requires the Secretary, by regulation, to identify
certain preventable conditions that are not present on
admission, and that therefore are acquired in the health care
facility. Medicare Part A reimbursement is not provided for the
care of these secondary conditions. This provision is
implemented in CMS's annual Inpatient Prospective Payment
System (IPPS) rule for hospitals. At this time, listed
conditions include some that are unrelated to infection (such
as incompatible blood transfusions, and trauma resulting from
falls in the facility), as well as specific types of catheter-
associated and surgical site infections. The rules explain that
some other infections (such as infection with methicillin-
resistant Staph. aureus, or MRSA) are not included because,
among other things, it can be hard to determine, in an
individual patient, whether an infection is associated with
health care or was acquired previously.
Also, two voluntary CMS reporting programs established
under current law may capture information related to HAIs. The
Physician Quality Reporting Initiative (PQRI), established
under Section 101(b) of the Tax Relief and Healthcare Act of
2006 (P.L. 109-432), provides incentive payments to physicians
who report certain quality measures, which include instances of
catheter-associated or surgical site infection. Information
from this program is not publicly reported. The Reporting
Hospital Quality Data for Annual Payment Update (RHQDAPU)
Program, originally established under section 501(b) of the
Medicare Prescription Drug, Improvement, and Modernization Act
of 2003 (MMA, P.L. 108-173), requires participating hospitals
to report quality data to CMS in order to receive a full annual
payment update. Selected measures are publicly reported on the
CMS Hospital Compare website. However, regarding infections,
this program uses process measures (e.g., antibiotics were used
properly in surgical patients) rather than outcome measures
(e.g., a patient developed a surgical site infection).
The Health Information Technology for Economic and Clinical
Health (HITECH) Act, which was incorporated into the American
Recovery and Reinvestment Act of 2009 (P.L. 111-5), created a
new Title XXX in the PHS Act to promote the widespread adoption
of health information technology (HIT). Among its provisions,
the HITECH Act established a process for the development of
interoperability standards that support the nationwide
electronic exchange of health information among doctors,
hospitals, patients, health plans, the federal government, and
other health care stakeholders.
Proposed Law
HAIs are a result of treatment in a healthcare service
setting such as a hospital or an ambulatory surgery center, but
secondary to the patient's original condition. Studies have
shown that such infections have been increasing over the past
few years due to factors such as increasing drug resistance of
bacteria and improper infection control measures. Surveillance
is critical as a public health measure so as to identify and
respond to emerging threats, and over 20 states now have
mandatory reporting for health facilities on health care-
associated infections. These efforts have provided the
infrastructure for effective interventions which can virtually
eliminate certain types of health care-associated infections.
This section would establish a new SSA Section 1138A
requiring the Secretary to provide, by regulation, that in
order to participate in Medicare and Medicaid, hospitals and
ambulatory surgical centers would have to report certain health
care-associated infections that develop in the facility. The
Secretary would specify the types of information that must be
reported, and develop reporting protocols through the Centers
for Disease Control and Prevention (CDC), assuring that such
protocols are coordinated with systems established under the
HITECH Act. The Secretary would be required: to establish
procedures regarding the validity of reported data to assure
appropriate comparisons between facilities; to promulgate,
through the Director of CDC, regulations to carry out this
section, within one year of enactment; and to post information
from the system on the HHS website in a manner that permits
comparisons by facility and by patient demographic
characteristics.
This section would also require the Secretary annually to
report to Congress on specified aspects of the program, and
would provide that this section should not be construed as
preempting or otherwise affecting state laws relating to the
disclosure of information on HAIs or patient safety procedures
for a hospital or ambulatory surgical center. It would also
define an HAI and its relationship to the receipt of care, and
would clarify that for the purposes of this section, hospitals
include critical access hospitals.
This provision would provide that for hospitals and
ambulatory surgical centers, reporting requirements would take
effect when specified by the Secretary, but not later than 2
years after enactment. Within 18 months of enactment, the
Comptroller General would be required to report to Congress
regarding the reporting program, and the Secretary would be
required to report to Congress regarding the appropriateness of
expanding reporting requirements to include additional
information, such as health care worker immunization rates.
TITLE V--MEDICARE GRADUATE MEDICAL EDUCATION
Sec. 1501. Distribution of unused residency positions
Current Law
With certain exceptions, the Balanced Budget Act of 1997
(BBA, P.L. 105-33) limited the number of allopathic and
osteopathic residents for which Medicare would reimburse a
teaching hospital at the level reported in its cost report
ending on or before December 31, 1996. The limit does not
include dental or podiatry residents. The Medicare Prescription
Drug, Improvement and Modernization Act of 2003 (P.L. 108-173,
MMA) authorized the redistribution of up to 75% of each
teaching hospital's unused resident positions to hospitals
seeking to increase their medical residency training programs.
Any adjustments made to teaching hospitals' resident limits
would be permanent. Rural teaching hospitals with less than 250
beds were exempt from the redistribution of any of their
unfilled positions. Under the redistribution program, teaching
hospitals were allowed to request up to an additional 25 full
time equivalent (FTE) positions for direct graduate medical
education (DGME) and indirect medical education (IME) payments.
Hospitals were required to demonstrate the likelihood that the
redistributed positions would be filled within 3 cost reporting
periods beginning July 1, 2005. MMA required that the unused
slots be redistributed according to specific priorities: rural
hospitals, urban hospitals located in areas with a population
of one million or less, specialty training programs that are
the only specialty program in a state, and all other hospitals.
The redistribution was effective for portions of cost reporting
periods starting July 1, 2005. The redistributed resident slots
have different IME and DGME payment formulas from those used to
reimburse hospitals' previous residents.
Proposed Law
The Secretary would reduce the otherwise applicable
resident limit for a hospital that has residency positions that
were unused. Unused positions would be established when a
hospital's reference residence level is less than its otherwise
applicable resident limit. The reduction would be effective for
portions of cost reporting periods occurring on or after July
1, 2011. Hospitals that are members of the same affiliated
group would be subject to redistribution. The Secretary would
adjust the determination of available slots for affiliated
hospitals depending upon the extent that these hospitals could
demonstrate that they are filling any additional residents
slots allocated to other hospitals through an affiliation
agreement. 90% of unused slots would be redistributed to
qualifying hospitals. The increase in resident training
positions would be distributed to qualifying hospitals not
later than July 1, 2011.
A hospital's reference residence level would be established
as the highest resident level of any of the 3 most recent cost
reporting periods (ending before the date of enactment).
Hospital cost reports that had been settled or those that had
been submitted, subject to audit, would be used to establish
the residence level. Also, upon timely request, a hospital's
reference resident level could be increased to reflect an
expansion or planned expansion of an existing residency
training program that is not reflected on the most recent
settled or submitted cost report. The increase would occur
after audit and would include the previous redistribution of
unused resident positions that occurred under MMA. The
Secretary would be authorized to determine an alternative
resident reference level for hospitals that submit a timely
request for an increase in their reference resident level due
to a planned expansion before the start of the 2009-2010
academic year. A hospital's resident reference level would be
increased to the extent that its level was increased because of
the prior redistribution of resident slots.
The Secretary would be required to increase the otherwise
applicable resident limit for each qualifying hospital that
submits a timely application by such number for portions of
cost reporting periods that occur on or after July 1, 2011. The
aggregate number of increases in resident limits may not exceed
the estimated aggregate reduction in resident limits. In no
case would more than 20 FTE additional residents be made
available to a qualifying hospital.
A hospital that qualifies for an increase in its otherwise
applicable resident limit would be required to ensure that the
number of primary care residents is maintained at its base
level of primary care residents increased by the number of
additional primary care residents provided to the hospital. The
hospital would have to assign all additional resident positions
for primary care residents. The hospital's residency programs
in primary care would have to be fully accredited or, if not
yet in operation as of the base year, the hospital would have
to be actively applying for such accreditation for the program.
A hospital's base level of primary care residents is the level
of such residents in a base period determined without regard to
whether such positions were in excess of the otherwise
applicable resident limits. Hospitals receiving positions would
be required to maintain records and periodically report on the
number of primary care residents in its training programs. As a
condition of continuing payment for a cost reporting period,
the hospitals would be required to maintain the base level of
positions at not less than the sum of the level of primary care
resident positions before receiving additional positions plus
the number of additional positions.
When determining which qualifying hospitals would receive
an increase in their otherwise applicable resident limit, the
Secretary would take into account the demonstrated likelihood
that a hospital would fill the positions within the first 3
cost reporting periods beginning on or after July 1, 2011.
Also, the Secretary would distribute the resident slots based
on the following criteria: (1) the hospital had a reduction in
the resident training positions under this section; (2) the
hospital has a 3-year primary care residency training program,
such as family practice and general internal medicine; (3) the
hospital has formal arrangements, as determined by the
Secretary, that place greater emphasis upon training in
federally qualified health centers, rural health clinics, and
other nonprovider settings and to hospitals that receive
additional disproportionate share hospital payments and
emphasize training in an outpatient department; (4) the
hospital has resident training positions in excess of its
otherwise applicable resident level as of July 1, 2009; (5) the
hospital has formal arrangements that place greater emphasis on
training in a health professional shortage area or health
professional needs area; or (6) the hospital is in a state with
a low resident-to-population ratio (including a greater
preference for those states with lower resident-to-population
ratios).
The per resident amounts (PRAs) for the resident positions
distributed under this provision would equal the hospitals'
PRAs for primary and nonprimary care positions for the purposes
of calculating direct graduate medical payments. The indirect
medical education adjustment for the resident positions
distributed under this provision would be computed in the same
fashion as the hospital's existing resident positions.
Reasons for Change
The healthcare system is increasingly uncoordinated and
complex, but a solid primary care workforce can help to support
a well-coordinated and integrated delivery model. Despite clear
advantages of a strong primary care workforce, the number of
primary care slots and medical students choosing primary care
as a specialty has decreased over the past decade. This is the
case even though the total amount of the physician workforce
has remained stable. Studies have recently shown that while 35%
of the current physician workforce is in primary care, 21% to
24% of graduating medical students choose primary care medicine
as a career specialty. According to the Council of Graduate
Medical Education (COGME), since the Graduate Medical Education
(GME) cap was put in place in 1996, primary care internal
medicine positions in the annual student match have fallen 57%,
primary care pediatric positions have fallen by 34%, and family
medicine positions have fallen by 18%. Over the past ten years,
nearly all of the graduate medical expansion in teaching
hospitals has been in subspecialty medicine. Family practice
residency programs and three-year training programs that
emphasize a generalist training have decreased or have closed
as well.
In its May 2009 report, COGME stated that graduate medical
education should be realigned to meet society's evolving
healthcare needs. COGME recommended an emphasis on training
more primary care physicians, training residents capable of
practicing in innovative delivery care models such as patient-
centered medical homes and accountable care organizations, and
increasing the accountability of graduate medical education's
role in public health. Similarly, in its June 2009 report,
MedPAC's recognized that residents will best learn the skills
needed to provide high-quality, efficient care when medical
education occurs in settings where such care is actually
performed. MedPAC will explore policies in future work linking
medical education incentives to delivery system reforms. This
policy is intended to increase training of primary care
physicians in a broader array of settings in order to meet the
future healthcare needs of the American public.
The Committee notes that some policymakers point to earlier
COGME reports to argue for the need for more Medicare-funded
residency slots. However, COGME now recognizes that earlier
calls for increased residency slots focused on the growth in
medical schools, and failed to take into account the fact that
GME positions already exceed allopathic medical school slots by
30%. For instance, in 2007-2008, the United States graduated
about 17,500 allopathic students but had more than 25,000 first
year residency positions. COGME points out that first-year
residency positions grew eight percent from 2002 and 2007 and
this expansion will accommodate increases in medical school
production. The shortcoming is not in the number of medical
residents being trained, but that nearly all of this expansion
is in subspecialty training, resulting in a drop in primary
care physicians.
The legislation increases primary care physicians by
directing the Secretary to redistribute residency positions
that have been unfilled for the prior 3 cost reports and
directs those slots for training of primary care physicians.
Special preference will be given to programs that saw a
reduction in their slots under this section, have formal
arrangements to train residents in ambulatory settings or
shortage areas, operate three-year primary care residency
programs, currently operate residency programs over their cap,
or are located in states with low resident-to-population
ratios. Primary care physicians are trained in three-year
general medicine, pediatrics or family practice residency
programs. Within this universe of residency programs are a
select number of programs that place emphasis on a generalist
curriculum (such as family practice programs) and are referred
to as ``three-year primary care residency training programs,''
as compared to the ``categorical'' or basic programs where a
resident will then go on to specialize. This provision directs
the Secretary to give preference to these ``three-year primary
care'' programs. The increase in resident training positions
would be distributed to qualifying hospitals not later than
July 1, 2011.
Effective Date
Cost reporting periods beginning on or after July 1, 2011.
Sec. 1502. Increasing training in nonprovider settings
Current Law
Medicare reimburses the direct costs of graduate medical
education (DGME) for approved residency training programs
without regard for the setting where the residents' activities
relating to patient care are performed as long as the hospital
incurs all, or substantially all, of the costs for the training
program in that setting. Through regulation, CMS has defined
all, or substantially all costs, as 90% of resident stipends
and fringe benefits and costs associated with a supervising
physician. As presently administered, however, a hospital
cannot include the time spent by residents working at a non-
hospital site if it incurs all, or substantially all, of the
costs for only a portion of the residents in that program at
the non-hospital site.
Section 1886(k) provides for payment to qualified
nonhospital providers, such as FQHCs and rural health clinics,
for their direct costs of medical educations if those costs are
incurred in the operation of an approved medical residency
training program.
Proposed Law
Effective for cost reporting periods beginning on or after
July 1, 2009, all time spent by a resident would count towards
the determination of an FTE resident with respect to Medicare's
direct graduate education payment, without regard to the
setting where the activities are performed, if the hospital
incurs the costs of the stipends and the fringe benefits of the
resident during the time the resident spends in that setting.
Any hospital claiming payment for the time spent in a
nonprovider setting would be required to maintain and make
available necessary records regarding the amount of time and
this amount in comparison to the amounts of time in a specified
base year.
Effective for discharges on or after July 1, 2009, all the
time spent by a resident inpatient care activities in a
nonprovider setting would be counted towards the determination
of an FTE resident with respect to Medicare's indirect medical
education payment if the hospital incurs the costs of the
stipends and fringe benefits of the resident during the time
spent in that setting. The Office of the Inspector General
(OIG) would be required to analyze the resident data to assess
the extent to which there is an increase in time spent by
medical residents training in nonprovider settings. No later
than 4 years after the date of enactment, the OIG would submit
a report to Congress on its analysis and assessment.
The Secretary would conduct a demonstration project where
an approved teaching health center would be eligible for direct
medical education payments for its own direct cost of graduate
medical education activities for primary care residents as well
as for the direct costs of such graduate medical education
activities of its contracting hospital for such residents.
Under the project, an approved teaching health center would
contract with an accredited teaching hospital to carry out the
inpatient responsibilities of the primary care residency
program. The center would be responsible for payment of the
hospital's costs of the salary and fringe benefits for
residents. The hospital's full-time equivalent resident amount
would not affect the contracting hospital's resident limit. The
contracting hospital would not reduce the number of residents
in its primary care residency training program. An approved
teaching health center would be a nonprovider setting, such as
a federally qualified health center or rural health clinic that
develops and operates an accredited primary care residency
program for which funding would be available if the hospital
were to operate the program.
Reason for Change
MedPAC and COGME have recommended that physicians be
trained at alternative care settings such as ambulatory
settings. COGME called for a ``broadening of the definition of
the training venue'' and emphasized preparing a physician
workforce for outpatient care, where most of the health care
takes place, and to consider placing physicians at community
health centers, rural health clinics, and physician offices.
Residents should also be exposed to patient care coordination
in a variety of health care settings. Teaching hospitals face
considerable financial incentives and regulatory barriers that
discourage them from rotating residents to nonhospital
settings.
The intent of this legislation is to decrease the
regulatory barriers so that residents can increase their
training in nonprovider care settings (settings outside of the
acute care hospital). This policy modifies the rules that
govern when hospitals can receive indirect medical education
(IME) and direct graduate medical education (DGME) funding for
residents who train in nonprovider settings so that any time
spent by the resident in a nonprovider setting shall be counted
for the purposes of calculating graduate medical education
payments if the hospital incurs the costs of the residents'
salaries and fringe benefits. A study by OIG shall assess the
impact of this policy on increasing physician training in
nonprovider settings.
The changes are effective for discharges on or after July
1, 2009, and the OIG is required to report to Congress within 4
years after the date of enactment.
A demonstration project is established to allow community
health centers and other nonprovider entities to host an
approved primary care residency program and receive DGME for
itself and for the hospital that it will contract with to
provide the inpatient training. This demonstration project will
inform the Secretary and Congress on the feasibility of a
nonprovider entity hosting a residency program in which it is
the lead contracting entity with a hospital and inform possible
alternative payment methodologies for nonhospital teaching
sites. The Committee recognizes the importance of training in
non-provider settings. Due to the fact that patients in the
ambulatory setting are more likely to be healthier and younger
than a hospital setting, any movement to train residents in the
outpatient setting will direct Medicare dollars in ways that
are not as focused on Medicare patients. In part, this is why
the Committee believes it prudent to test multiple innovative
strategies that will promote ambulatory training in order to
inform future policy on the financing of graduate medical
education. This demonstration project only addresses DGME
payments and will promote training in ambulatory settings,
consistent with COGME and MedPAC recommendations. It will also
help ensure that primary care physicians are optimally prepared
to deliver health services to Medicare and non-Medicare
beneficiaries (and in particular pre-Medicare beneficiaries) to
promote preventive care and reduce preventable
hospitalizations.
Effective date
Cost reporting periods beginning on or after July 1, 2009.
Sec. 1503. Rules for counting resident time for didactic and scholarly
activities and other activities
Current Law
Medicare pays teaching hospitals the costs of approved
medical residency training programs through two mechanisms: an
indirect medical education (IME) adjustment within the
inpatient prospective payment system (IPPS) and direct graduate
medical education (DGME) payments made outside of IPPS. Certain
non-patient care activities that are part of an approved
training program are not allowable for DGME or IME payment
purposes. With respect to training that occurs in hospital
settings, Medicare does not include the time that residents
spend in non-patient care activities, including didactic
activities, when calculating IME payments. With respect to
training that occurs in nonhospital settings, Medicare would
not count the time that residents spend in non-patient care
activities, including didactic activities, when calculating
DGME or IME payments.
Proposed Law
When calculating DGME payments, Medicare would count the
time that residents in approved training programs spend in
certain non-direct patient care activities in a nonhospital
setting that is primarily engaged in furnishing patient care.
The term ``nonprovider setting that is primarily engaged in
furnishing patient care'' would be a nonprovider setting in
which the primary activity is the care and treatment of
patients as defined by the Secretary. Reimbursable nonpatient
care activities would include didactic conferences and seminars
but would not include research that is not associated with the
treatment or diagnosis of a particular patient. In addition,
Medicare would count all the vacation, sick leave, and other
approved leave spent by resident in an approved training
program as long as the leave time does not extend the program's
duration.
When calculating IME payments, Medicare would adopt the
same rules about counting residents' leave time. Medicare would
also include all the time spent by residents in approved
training programs on certain nonpatient care activities
(including didactic conferences and seminars, but not in
certain research activities that are not associated with the
treatment or diagnosis of a particular patient) if the hospital
is an IPPS hospital, a hospital paid under the IPPS for Puerto
Rico, is a hospital paid under a state specific hospital
reimbursement system, or is a provider-based hospital
outpatient department.
Except as otherwise provided, these provisions would be
effective for cost reporting periods beginning on or after
January 1, 1983. The provisions affecting DGME would apply to
cost reporting periods on or after July 1, 2008. The provisions
affecting IME would apply to cost reporting periods on or after
October 1, 2001. This section would not affect the
interpretation of the law in effect prior to that date. The
provisions would not be implemented in a manner that would
require reopening of any settled hospital cost reports where
there is not a jurisdictionally proper appeal pending on IME
and DGME payments as of the date of enactment.
Subsection (a)(1)(B) pertaining to direct graduate medical
education is effective for cost reporting periods beginning on
or after July 1, 2008. Subsection (b) pertaining to indirect
medical education is effective for cost reporting periods
beginning on or after October 1, 2001. All other provisions are
effective for cost reporting periods beginning on or after
January 1, 1983.
Reason for Change
While in residency training, physicians need to learn
critical evidenced-based medicine and participate in scholarly
activities related to the management of their patients. Time
devoted during residency training in didactic and scholarly
activities broadens residents' clinical knowledge base and
improves their ability to deliver quality and efficient care.
The policy modifies current rules to allow for inclusion of
didactic and scholarly activities and other activities such as
research related to the care of their patients in counting
toward the determination of full-time equivalency for the
purposes of calculating graduate medical education payments.
This provision seeks to eliminate the financial disincentive
for hospitals to facilitate residents' participation in these
activities and training in ambulatory settings. The provisions
affecting IME would apply to cost reporting periods on or after
October 1, 2001, and the provisions affecting DGME would apply
to cost reporting periods on or after July 1, 2008.
Sec. 1504. Preservation of resident cap positions from closed and
acquired hospitals
Current Law
With certain exceptions, the Balanced Budget Act (BBA) of
1997 limited the number of allopathic and osteopathic residents
for which Medicare would reimburse a teaching hospital at the
level reported in its cost report ending on or before December
31, 1996. If a teaching hospital closes (defined as withdrawing
participation in the Medicare program), CMS permits a temporary
cap increase to other teaching hospitals to accommodate
residents suddenly displaced from the closed hospital. Upon
completion of their training, the residency slots cease to
exist.
A hospital with a newly established residency program may
receive an adjustment to its full-time equivalent (FTE) cap
(which otherwise would be zero) if it establishes one or more
new medical residency training programs, but only for new
programs established within 3 academic years after residents
begin training in the first new program. CMS recently put forth
a final rule on July 31, 2009, that clarifies that a ``newly
established'' residency program for Medicare GME purposes is
not a program that existed previously at another hospital. In
determining that a program is truly new, CMS will use certain
``supporting factors,'' such as whether the program director,
teaching staff, and residents are different. CMS will also
consider whether the program relocated from a hospital that
closed, and whether that program is part of any existing
hospital's FTE cap determination. If the program did relocate
from a closed hospital and that program is not part of any
existing hospital's FTE cap determination, then even if there
are significant similarities between the program in terms of
the program director, teaching staff, or residents, CMS could
consider the program that was transferred from the closed
hospital to be new for Medicare DGME and IME, since there would
be no danger that an FTE cap adjustment to reflect a new
program would result in duplicative residency slots.
CMS also has established certain regulations governing
Medicare's provider enrollment requirements that determine
under which circumstances providers can bill the Medicare
program including those involved in change of ownership (CHOW)
transactions. Very generally, in order to acquire a teaching
hospital's resident cap under a CHOW transaction, the acquiring
entity must retain the original provider agreement of the
provider it is acquiring. However, the acquiring entity would
also assume all liabilities associated with that provider
agreement.
Starting August 29, 2005 (the day after Hurricane Katrina),
hospitals were permitted to form emergency affiliation
agreements if located in federally declared disaster areas,
starting the first day of a Section 1135 emergency period.
Under 42 Code of Federal Regulations (CFR) 413.79, a home
hospital located in such an area that experiences at least a
20% decline in inpatient occupancy can temporarily transfer its
resident cap to a host hospital.
Proposed Law
The Secretary would promulgate regulations to establish a
process where the FTE residency cap slots in a hospital with an
approved medical residency program that closes on or after a
date that is 2 years before the date of enactment could be used
to increase the otherwise applicable residency limit for other
hospitals in the State. The increase in residency programs
would be distributed to one or more hospitals in the State in a
manner specified by the Secretary. This process would be
consistent with any recommendations submitted by the senior
health official designated by the chief executive officer of
the state in question, provided that the recommendations are
not submitted later than 180 days after the date of a hospital
closure. In cases where a hospital closed before date of
enactment, the time limit would be 180 days from the date of
enactment. The aggregate number of increased residency limits
in the state would equal the number of FTE resident cap slots
from the hospital(s) that closed. These provisions would not
affect any temporary adjustment to a hospital's FTE resident
cap established under 42 CFR 413.79 as in effect on the date of
enactment.
Reason for Change
When hospitals close, the residency slots previously
associated with those hospitals are no longer eligible for
further Medicare reimbursement once the existing residents
complete their training. This occurs regardless of any
continued need for those residency slots to meet current or
future workforce needs in the community or state. This
provision allows for continued funding of the residency slots
of closed hospitals at other hospitals within the state.
Recommendations from the senior health official of the state
will assist the Secretary in understanding the state's current
and future workforce needs to inform her determination of which
hospitals receive upward adjustments or new residency caps.
Sec. 1505. Improving accountability for approved medical residency
training
Current Law
Medicare will reimburse teaching hospitals for the direct
and indirect costs associated with an approved teaching program
accredited by an independent entity, such as the Accreditation
Council for Graduate Medical Education or the American
Osteopathic Association. Medicare has never linked its payments
to promoting or fostering any goals in medical education or
accountability measures.
Proposed Law
Certain goals of medical residency training programs would
be established. Specifically, resident training would be
designed so that physicians would be able to: (1) work
effectively in various health care delivery settings, such as
nonprovider settings; (2) coordinate patient care within and
across relevant settings; (3) understand the relevant cost and
value of various diagnostic and treatment options; (4) work
effectively in inter-professional and multi-disciplinary teams
in provider and nonprovider settings; (5) identify systematic
errors in health care delivery and implement solutions for such
errors; and (6) be meaningful electronic health record users.
GAO would be required to evaluate the extent to which
medical residency training programs are meeting the above
workforce goals in a range of residency programs, including
primary care and other specialties; and have the appropriate
faculty expertise to teach the topics required to achieve such
goals. A report on the results of the study would be submitted
to Congress no later than 18 months after the date of the
enactment. The study would include recommendations with respect
to the development of curriculum requirements and an assessment
of the accreditation processes of the Accreditation Council for
Graduate Medical Education (ACGME) and the American Osteopathic
Association (AOA) and effectiveness of these processes in
meeting the residency program goals established in this
section.
Reason for Change
MedPAC recommends that the residency training experience
should encourage physicians to increase care coordination and
assume greater accountability for quality of care. Graduate
medical education should train a future physician workforce
exposed to innovative delivery models that would support more
integration. A MedPAC-sponsored study conducted by RAND pointed
out that the curricula of residency training programs fall
short of recommendations by the Institute of Medicine and other
experts on items such as formal training or experience in
multidisciplinary teamwork, cost-awareness in clinical
decision-making, comprehensive health information technology,
and patient care in nonhospital settings. Residents should be
trained in innovative delivery systems that will support
coordinated care and enhance an integrated approach. The
Accreditation Council for Graduate Medical Education has also
included similar goals for residency programs to improve the
training of residents. The COGME report calls for ``making
accountability for the public's health the driving force for
graduate medical education.'' The report further states that
the $10 billion spent annually on GME should have parameters on
how our physician workforce should be trained and the type of
training residents should receive. This policy is intended to
highlight broad goals, consistent with MedPAC recommendations,
for residency programs to improve their accountability. The
Comptroller General will undertake a study to assess: (1) the
extent to which residency programs are meeting these goals and
(2) the accreditation processes of ACGME and AOA and
effectiveness of these processes in promoting the workforce
goals established in this section.
TITLE VI--PROGRAM INTEGRITY
Subtitle A--Increased Funding to Fight Fraud, Waste, and Abuse
Sec. 1601. Increased funding and flexibility to fight fraud and abuse
Current Law
The Health Care Fraud and Abuse Control (HCFAC) account
funds activities to fight healthcare fraud. The HCFAC program
along with the Medicare Integrity Program (MIP) were both
established by the Health Insurance Portability and
Accountability Act of 1996 (HIPAA, P.L. 104-191), which sought
to increase and stabilize federal funding for healthcare anti-
fraud activities. Specifically, HCFAC funds are directed to the
enforcement and prosecution of healthcare fraud. MIP funding
supports the program integrity activities undertaken by CMS
contractors.
For HCFAC, HIPAA appropriated funds to the Department of
Health and Human Services, the Department of Justice (DOJ), and
the Federal Bureau of Investigation (FBI) for anti-fraud
activities undertaken for fiscal years 1997 through 2003. Funds
are appropriated to the Account from the Medicare Part A Trust
Fund in amounts as the Secretary and the Attorney General
certify are necessary to support audits, investigations,
evaluations, and prosecutions related to healthcare fraud. For
HHS and DOJ, the legislation authorized an amount, beginning at
$104 million for FY1997, equal to the limit for the preceding
year increased by 15%. Within this amount, the legislation
authorized minimum and maximum appropriations for the HHS OIG.
The maximum OIG appropriation increased from $70 million in
FY1997 to $160 million in FY2003. For each fiscal year after
2003, the amount was capped at the 2003 level. In December
2006, Congress passed the Tax Relief and Health Care Act of
2006 (TRHCA, P.L. 109-432), which extended the mandatory annual
appropriation for HCFAC to 2010. For fiscal years 2007 through
2010, the mandatory annual appropriation is the limit for the
preceding year plus the percentage increase in the consumer
price index for all urban consumers (CPI-U). For years after
FY2010, the annual appropriation remains at the FY2010 level.
The MIP program authorizes the Secretary of HHS to enter
into contracts with private organizations to conduct program
integrity activities such as provider audits and medical review
of claims. The largest share of the HIPAA appropriation was
dedicated to the MIP program. Funding for MIP increased from
$440 million in FY1997 to $720 million in FY2003. For fiscal
years 2004 and 2005, the annual MIP appropriation remained at
the FY2003 level. In 2005, Congress passed the Deficit
Reduction Act (DRA, P.L. 109-171), which raised funding for the
MIP program by $112 million for FY2006 to implement program
integrity and oversight activities for the Medicare
prescription drug benefit. This increased the annual MIP
appropriation from $720 million to $832 million for FY2006
only. Congress did not increase funding for MIP in TRHCA.
Therefore the mandatory annual appropriation for MIP remains at
$720 million.
Proposed Law
The Congressional Budget Office has estimated that every
dollar of increased funding for HCFAC results in a $1.75 return
on investment. The provision would increase funding for HCFAC
by $100 million annually beginning with FY2011, to allow for
the implementation of new provisions in the legislation and
providing new tools for CMS under current laws. Funding would
be appropriated to HHS, DOJ, and MIP in the same manner as is
currently appropriated in statute. Funding allocated to MIP
would be authorized for HCFAC activities as well as MIP
activities, ending the requirement that such funding be
distributed solely to private organizations to conduct program
integrity activities. Funding for both HCFAC and MIP would be
available without further appropriation until expended.
Subtitle B--Enhanced Penalties for Fraud and Abuse
Sec. 1611. Enhanced penalties for false statements on provider or
supplier enrollment applications
Current Law
Medicare statute provides the Secretary with general
authority to prescribe regulations for the efficient
administration of the Medicare program. Under this authority,
the Center for Medicare and Medicaid Services (CMS) has
implemented regulations requiring Medicare providers and
suppliers to submit an application to enroll in the Medicare
program and receive billing privileges. Providers and suppliers
must resubmit and recertify the accuracy of their enrollment
information every 5 years. Private contractors handle Medicare
enrollment activities such as processing and reviewing
applications. CMS may deny enrollment of a provider or supplier
in Medicare or revoke a provider's billing privileges for the
following reasons: non-compliance with enrollment requirements,
exclusion from participation in federal health care programs,
conviction of a felony, or the submission of false or
misleading information on the enrollment application.
Medicaid statute delegates the administration of the
Medicaid program to the states. There is considerable variation
in how states administer their provider enrollment processes.
State Medicaid agencies determine whether a provider or
supplier is eligible to participate in the Medicaid program by
providing for written agreements with providers and suppliers.
Written agreements require that providers and suppliers
maintain specific records, disclose certain ownership
information, and grant access to federal and state auditors to
books and records.
Section 1128A(a) of the Social Security Act (SSA)
authorizes the imposition of Civil Monetary Penalties (CMPs)
and assessments on a person, including an organization, agency,
or other entity, who engages in various types of improper
conduct with respect to federal health care programs. Under
section 1128A(a)(1)(D) of the Act, a person who knowingly
presents or causes to be presented a claim to federal or state
agencies that the Secretary determines is for an item or
service furnished during a period when the person was excluded
from participation in the federal health care program under
which the claim was made is subject to a civil monetary penalty
of up to $10,000 for each item or service furnished, and an
assessment of up to three times the amount claimed for each
item or service.
Proposed Law
This provision would subject providers and suppliers
applying to enroll or renewing enrollment in federal health
care programs to CMPs for providing false information on an
enrollment application. Medicaid managed care plans, MA plans,
and PDP plans would also be subject to CMPs for providing false
information on applications to participate in federal health
care programs.
Specifically, the provision would provide that a person who
knowingly makes or causes to be made any false statement,
omission, or misrepresentation of a material fact on an
application, agreement, bid, or contract to participate or
enroll as a provider of services or supplier under a federal
health care program would be subject to a CMP of $50,000 for
each violation. In addition to providers and suppliers, the
provision would also apply to Medicaid managed care
organizations, Medicare Advantage (MA) organizations and MA
plans, Prescription Drug Plan (PDP) sponsors and plans, and
providers and suppliers that participate in these Medicare or
Medicaid plans. In addition, such a person may be subject to an
assessment of not more than three times the amount claimed as
the result of the false statement, omission, or
misrepresentation.
The provision would also eliminate the requirement for a
determination by the Secretary when a person knowingly presents
or causes to be presented a claim for an item or service
furnished during a period when the person was excluded under
federal law from the federal health care program under which
the claim was made.
Sec. 1612. Enhanced penalties for submission of false statements
material to a false claim
Current Law
Section 1128A(a) of the Social Security Act authorizes the
imposition of CMPs and assessments on a person, including an
organization, agency, or other entity, who engages in various
types of improper conduct with respect to federal health care
programs. This penalty authority includes penalties against a
person who knowingly presents or causes to be presented false
or fraudulent claims. This section generally provides for CMPs
of up to $10,000 for each item or service claimed, $15,000 or
$50,000 under other circumstances, and an assessment of up to
three times the amount claimed.
Proposed Law
The bill would create a new SSA section 1128A(a)(9)
providing that persons who knowingly make, use, or cause to be
made or used any false statement or record material to a false
or fraudulent claim submitted for payment to a federal health
care program would be subject to a civil monetary penalty of
not more than $50,000 for each violation.
Sec. 1613. Enhanced penalties for delaying inspections
Current Law
The Secretary is required to provide for the annual
auditing of the financial records of at least \1/3\ of MA
plans. Each contract with a MA plan is required to provide that
the Secretary have the right to inspect or evaluate the
quality, appropriateness and timeliness of services performed
under the contract. Contracts must also provide the Secretary
with right to audit any plan's books and records related to the
plan's ability to bear risk or to the services performed,
including determinations of amounts payable under the contract.
Proposed Law
The bill would create a new SSA section 1128A(a)(10)
providing that persons who fail to grant timely access, upon
reasonable request (as defined by the Secretary in
regulations), to the Office of the Inspector General (OIG), for
the purpose of audits, investigations, evaluations, or other
statutory functions of the OIG, be subject to CMPs of $15,000
for each day of failure. The provision would also modify the
contractual requirements for MA plans to allow the Secretary to
conduct timely audits and inspections of MA plans. These
provisions are designed to facilitate more timely and efficient
audits, investigations, and evaluations by the OIG, and more
rapid and enhanced audits of MA plans by the Secretary.
Sec. 1614. Enhanced hospice program safeguards
Current Law
Medicare statute mandates the establishment of minimum
health and safety standards that must be met by providers
participating in the Medicare and Medicaid programs (i.e.
hospitals, hospices, nursing homes, and home health agencies).
In order to receive payment, providers and suppliers must meet
these health and safety standards, often referred to as
Conditions of Participation (CoPs). Generally, state agencies,
under contract with CMS, survey providers to determine
compliance with CoPs. Alternatively, a provider can be deemed
to meet these requirements if an approved national
accreditation body has accredited it. If a provder has been
found to be non-compliant with its CoPs, CMS has the authority
to impose certain sanctions, including revoking the provider's
participation agreement. States also have the authority to
impose sanctions on Medicare and Medicaid participating
facilities found to be non-compliant with CoPs.
Proposed Law
This provision would create new tools and penalties for the
Secretary to use in improving quality of care in hospices.
Under current law, the only options available to the Secretary
are program exclusions for hospices. The provision would add a
new SSA section 1819A that would require the Secretary to
develop and implement intermediate sanctions to apply to
hospices that, based on a determination by the Secretary,
demonstrate a substandard quality of care and fail to meet such
other requirements as the Secretary may find necessary in the
interest of the health and safety of the individuals provided
care and services by the agency or organization involved. The
sanctions may include CMPs of up to $10,000 for each day of
non-compliance or in the case of a per instance penalty not
more than $25,000, a denial of all or part of future Medicare
or Medicaid payments to which the hospice is entitled (which
would terminate upon the Secretary's finding that the hospice
program no longer demonstrated substandard quality and met
other requirements as determined by the Secretary), requiring
the appointment of managers to oversee the operation of the
hospice program, correction plans, and staff training. The
sanctions could be imposed in addition to those imposed under
state or federal law and would not be construed as limiting
other available remedies. The Secretary would have until
January 1, 2012, to develop and implement the sanctions.
By July 1, 2011, the Secretary would be required to create
the specific procedures and conditions under which the relevant
sanctions would apply, including the amount of any fines and
severity of the sanctions. The conditions would be required to
minimize the time between the identification of deficiencies
and imposition of sanctions, and would provide for more severe
fines for repeated deficiencies. The due process protections
provided in the CMP law (SSA section 1128A), such as written
notice and the right to a hearing, would apply in the same
manner to the imposition of a CMP for hospices.
This provision would also require the Secretary to take
immediate action to correct any identified deficiencies that
immediately jeopardize the health and safety of patients being
cared for in a hospice. The action would consist of either
appointing managers to oversee the operations of the hospice or
terminating the hospice's participation in federal health care
programs. The Secretary would be authorized to impose
additional remedies if necessary. If the Secretary determines
that identified deficiencies do not immediately jeopardize the
patients' health and safety, the Secretary, in lieu of
terminating the provider's participation in the program, may
impose other intermediate sanctions. If after a period of
intermediate sanctions, the deficiencies have not been
corrected, the Secretary would be required to terminate the
provider's participation in federal health programs. The
Secretary would also be authorized to impose CMPs on hospice
providers for any former days of non-compliance with federal
health and safety standards.
These provisions would also apply to hospice programs
participating in Medicaid and CHIP.
Sec. 1615. Enhanced penalties for individuals excluded from program
participation
Current Law
SSA section 1128A(a) authorizes the imposition of CMPs and
assessments on a person, including an organization, agency, or
other entity, who engages in various types of improper conduct
with respect to federal health care programs, including the
imposition of penalties against a person who knowingly presents
or causes to be presented false or fraudulent claims. This
section generally provides for CMPs of up to $10,000 for each
item or service claimed, $15,000 or $50,000 under other
circumstances, and an assessment of up to 3 times the amount
claimed.
Proposed Law
This provision would create new penalties for individuals
that are excluded from program participation but order or
prescribe program items or services. The bill would create a
new SSA section 1128A(a)(11) providing that a person who orders
or prescribes an item or service, including without limitation
home health care, diagnostic and clinical lab tests,
prescription drugs, durable medical equipment, ambulance
services, physical or occupational therapy, or any other item
or service, during a period when the person has been excluded
from participation in a federal health care program, and the
person knows or should know that a claim for such item or
service will be presented to such a program, be subject to a
civil monetary penalty of up to $50,000 for each order or
prescription. This amendment would apply to violations
committed on or after January 1, 2010.
Sec. 1616. Enhanced penalties for provision of false Information by
Medicare Advantage and part D plans
Current Law
MA plans enter into contracts with the Secretary to
participate in the Medicare program. The Secretary has the
authority to impose sanctions and CMPs on MA plans that violate
the terms of the contract. Among the violations are failing to
provide medically necessary care; imposing excess beneficiary
premiums; expelling or refusing to re-enroll beneficiaries;
discouraging or denying enrollment among eligible individuals
expected to require future medical services; misrepresenting or
falsifying information; failing to comply with balance billing
requirements; interfering with a provider's advice to
beneficiaries; and contracting with providers excluded from the
Medicare program. For violations related to discouraging or
denying enrollment or misrepresenting information provided to
the Secretary, the Secretary can impose a maximum penalty of
$100,000. For all other violations, the maximum penalty is
$25,000. The Secretary has the authority to impose additional
penalties for imposing excess beneficiary premiums and engaging
in activities that discourage enrollment.
Proposed Law
This new provision is designed to increase penalties for
the provision of false information by MA and Part D plans.
Under the new provision, MA and part D plans that misrepresent
or falsify information will be subject to penalties of up to
three times the amount claimed by a plan or plan sponsor based
on the misrepresentation or falsified information. The
provision would apply to violations committed on or after
January 1, 2010.
Sec. 1617. Enhanced penalties for Medicare Advantage and part D
marketing violations
Current Law
MA plans enter into contracts with the Secretary to
participate in the Medicare program. The Secretary has the
authority to impose sanctions and CMPs on MA plans that violate
the terms of the contract. Among the violations are failing to
provide medically necessary care; imposing excess beneficiary
premiums; expelling or refusing to re-enroll beneficiaries;
discouraging or denying enrollment among eligible individuals
expected to require future medical services; misrepresenting or
falsifying information; failing to comply with balance billing
requirements; interfering with a provider's advice to
beneficiaries; and contracting with providers excluded from the
Medicare program. For violations related to discouraging or
denying enrollment or misrepresenting information provided to
the Secretary, the Secretary can impose a maximum penalty of
$100,000. For all other violations, the maximum penalty is
$25,000. The Secretary has the authority to impose additional
penalties for imposing excess beneficiary premiums and engaging
in activities that discourage enrollment.
Proposed Law
This provision is designed to reduce marketing abuses by
Medicare Advantage and Part D plans by increasing the number of
violations subject to the imposition of sanctions and CMPs by
the Secretary. Beginning January 1, 2010, plans that: (1)
enroll individuals in a MA or Part D plan without their consent
(except Part D dual eligibles), (2) transfer an individual from
one plan to another for the purpose of earning a commission or
without consent of the individual, (3) fail to comply with
marketing requirements, including CMS guidance, or (4) employ
or contract with an individual or entity that commits a
violation would be subject to sanctions imposed by the
Secretary. Sanctions would apply to any employee or agent of a
MA or Part D plan, or any provider or supplier who contracts
with a MA or Part D plan.
Sec. 1618. Enhanced penalties for obstruction of program audits
Current Law
The OIG has discretion to exclude an entity or individual
from a federal health program for a conviction related to the
obstruction of a health care fraud investigation.
Proposed Law
This provision is designed to strengthen the OIG's ability
to conduct health care fraud investigations, by expanding the
OIG's permissive exclusion authority to include a conviction
related to the obstruction of an audit related to health care
fraud as well as an investigation or audit related to the use
of funds received from any health care program. The provision
would apply to violations committed on or after January 1,
2010.
Sec. 1619. Exclusion of certain individuals and entities from
participation in Medicare and State health care programs
Current Law
Section 1128 of the Social Security Act provides that the
Secretary (and through delegation, OIG) has the authority to
exclude individuals and entities from participation in federal
health care programs under a variety of circumstances.
Exclusion is mandatory for those convicted of certain criminal
offenses, and generally the exclusion cannot be for a period of
less than five years. OIG also has permissive authority to
exclude an individual or entity from a federal health program,
which includes the discretion to determine whether and for how
long the exclusion will be imposed. A permissive exclusion may
be imposed under numerous circumstances, including conviction
of certain misdemeanors relating to fraud, theft, embezzlement,
breach of fiduciary duty or other financial misconduct; a
conviction based on an interference with or obstruction of an
investigation into a criminal offense; and revocation or
suspension of a health care practitioner's license for reasons
bearing on the individual's or entity's professional
competence, professional performance, or financial integrity.
Under 42 C.F.R. 1001.1901, unless and until an excluded
individual or entity is reinstated into a federal health care
program, no payment will be made by a program for any item or
service furnished by the individual or entity, or at the
medical direction or on the prescription of a physician or
other authorized individual who is excluded when the person
furnishing such item or service knew or had reason to know of
the exclusion.
Proposed Law
The bill would amend section 1128(c) to clarify the effect
of an exclusion of an individual or entity on payment made
under a federal health care program. The section would provide
that payment cannot be made from any federal health care
program with respect to an item or service furnished (1) by an
excluded individual or entity, or (2) at the medical direction,
or on the prescription of an authorized individual (e.g., a
physician) when the person submitting a claim for the item or
service knew or had reason to know of an individual's
exclusion. Despite this prohibition, the bill would permit
payment to be made for emergency items or services (not
including items or services furnished in an emergency room of a
hospital) that are furnished by these individuals and entities.
For purposes of this section, as well as sections 1128A and
1128B (dealing with civil and criminal penalties in federal
health care programs), an item or service would be considered
furnished if the individual or entity directly or indirectly
provided, ordered, manufactured, distributed, prescribed, or
otherwise supplied the item or service regardless of how the
item or service was paid for by a federal health care program
or to whom such payment was made.
Section 1128(c) would also provide that if a person
eligible for benefits under Medicare or Medicaid submits a
claim for payment for items or services furnished by an
excluded individual or entity, and the eligible person did not
know or have reason to know that such individual or entity was
excluded, then payment must be made for the items or services.
In this case, the Secretary must notify the eligible person of
the exclusion of the individual or entity, and payment must not
be made for items or services furnished by an excluded
individual or entity to an eligible person after a reasonable
time after this notification.
The section would also provide that if a claim for payment
for items or services furnished by an excluded individual or
entity is submitted by an individual or entity other than a
person eligible for benefits under Medicare or Medicaid or that
excluded individual or entity itself, and the Secretary
determines that the individual or entity that submitted the
claim took reasonable steps to learn of the exclusion and
reasonably relied upon inaccurate or misleading information
from the relevant federal health care program or its
contractor, the Secretary may waive repayment of the amount
paid in violation of the exclusion to the individual or entity
that submitted the claim. If a federal health care program
contractor provided inaccurate or misleading information
resulting in the waiver of an overpayment under this section,
the Secretary must take appropriate action to recover the
improperly paid amount from the contractor.
Subtitle C--Enhanced Program and Provider Protections
Sec. 1631. Enhanced CMS program protection authority
Current Law
CMS has implemented regulations requiring providers and
suppliers to complete an application to enroll in the Medicare
program and receive billing privileges. As part of the
enrollment process, providers and suppliers are required to
submit information necessary to verify identity and state
licensure. CMS reserves the right to perform on-site
inspections of a provider or supplier to verify compliance with
standards. If enrollment requirements are not met, CMS may
revoke Medicare billing privileges. Providers and suppliers
must resubmit and recertify the accuracy of their enrollment
information every 5 years. CMS may deny a provider's or
supplier's enrollment in Medicare or revoke a provider's
billing privileges for the following reasons: non-compliance
with enrollment requirements, exclusion from participation in
federal health care programs, conviction of a felony, or the
submission of false or misleading information on the enrollment
application.
CMS manual instructions require that Medicare contractors
query the following databases prior to approving an application
for enrollment in Medicare: Qualifier.net, the Medicare
Exclusions Database (List of Excluded Individuals/Entities or
LEIE), and the Government Services Administration (GSA)
debarment list. All Medicare contractors are required to query
these databases when enrolling providers in the program.
Medicaid beneficiaries may obtain services from any
Medicaid participating provider recognized by the state. In
addition, Medicaid beneficiaries enrolled in primary care case
management system, a Medicaid managed care organization, or
similar entities must not restrict the choice of a qualified
provider of family planning services and supplies (with some
other exceptions). States are not required to provide Medicaid
coverage for such services when offered by persons or entities
convicted of felonies.
Proposed Law
This provision is designed to give the Secretary new
authority to protect the Medicare program from providers who
may commit waste, fraud, and abuse. The provision would add a
new section 1128G to the SSA that would authorize the
Secretary, in cases where there is a significant risk of fraud,
to subject providers and suppliers to enhanced screening,
oversight, or a moratorium on enrollment. The provision would
take effect on January 1, 2011. The Secretary would determine
what constitutes a significant risk of fraud by reviewing
complaints, reports, referrals from law enforcement or other
sources, and the results from data analysis, trend information,
or claims review. Risk could be determined with respect to a
single category of providers or suppliers or a single category
of providers or suppliers operating within a specific
geographic area.
This provision would apply to providers or suppliers
initially enrolling in Medicare, Medicaid, or CHIP as well as
those renewing their enrollment. The Secretary would be
authorized to require states to implement these program
safeguards as a requirement in their Medicaid or CHIP state
plans. State CHIP plans would also be required to include their
procedures for enforcing these requirements. Any actions taken
or determinations made by the Secretary in imposing these
requirements would not be subject to judicial review.
Additionally, states would be allowed to conduct enhanced
oversight activities beyond those required by the Secretary.
This provision would require the Secretary to establish
procedures for screening and enhanced oversight. Screening
procedures may include licensing board checks, reviews against
the LEIE, background checks, and unannounced pre-enrollment or
other site visits. During periods of enhanced oversight
(between 30 days and one year) the Secretary would be
authorized to take certain actions against providers, including
required or unannounced site visits or inspections, prepayment
review, enhanced review of claims, and other actions as
specified by the Secretary. The Secretary would be allowed to
extend these periods to more than one year if necessary.
In instances where the Secretary determinates that there is
a risk of serious ongoing fraud, the Secretary would have the
authority to impose a moratorium on enrolling providers within
a category of providers and suppliers, including a category
within a specific geographic area. Moratoriums could not be
imposed if the Secretary makes a determination that the
moratorium would adversely impact access to care. Medicaid
providers would be prohibited from providing coverage for
services delivered by providers under a moratorium.
Sec. 1632. Enhanced Medicare, Medicaid, and CHIP program disclosure
requirements relating to previous affiliations
Current Law
In order to receive payment from Medicare, providers must
enroll in the Medicare program. CMS regulations mandate that
enrollment applications contain information necessary to
uniquely identify the provider (i.e. proof of business name,
social security number, or Tax ID number) and include
documentation necessary to verify licensure or eligibility to
furnish Medicare covered items or services. Persons who sign
the enrollment applications are required to have an ownership
or control interest in the provider or supplier. Upon initial
enrollment in the program, the signature on the enrollment
application must be that of an authorized official. A delegated
official may sign renewal or updated applications. CMS has the
authority to perform on-site inspections of a provider to
verify enrollment information and determine compliance with
Medicare enrollment requirements. CMS has established an
Internet database called the Provider Enrollment, Chain and
Ownership System (PECOS) for providers to submit enrollment
information.
Medicaid statute delegates the administration of the
Medicaid program to the states. There is considerable variation
in how states' administer their provider enrollment processes.
State Medicaid agencies determine whether a provider or
supplier is eligible to participate in the Medicaid program by
providing for written agreements with providers and suppliers.
Written agreements require that providers and suppliers
maintain specific records, disclose certain ownership
information, and grant access to federal and state auditors to
books and records.
Proposed Law
Providers or suppliers that have previous affiliations with
entities that have had past problems with the Medicare or
Medicaid program may themselves present increased waste, fraud,
and abuse risks. This provision allows the Secretary to screen
for and take these previous affiliations into account.
Providers or suppliers submitting applications for enrollment
or renewing enrollment in Medicare, Medicaid, or CHIP after
January 1, 2011, would be required to disclose information
related to any current or previous affiliation (within the last
10 years) with providers or suppliers that have uncollected
debt, or with persons or entities that have been suspended or
excluded, been placed on payment suspension, or had their
billing privileges revoked. The Secretary would have the
authority to apply program safeguards to providers and
suppliers, such as enhanced screening of claims, required or
unannounced site visits and inspections, additional reporting
requirements, and surety bonds, if the Secretary determines
that certain affiliations pose a risk of fraud, waste, and
abuse. The provision would also provide the Secretary with the
authority to deny enrollment in Medicare, Medicaid, or CHIP in
instances when at least one affiliation or affiliations poses a
serious risk of fraud, waste, or abuse.
Sec. 1633. Required inclusion of payment modifier for certain
evaluation and management services
Current Law
Evaluation and management services include certain primary
care services, hospital inpatient medical services,
consultations, other visits, preventive medicine visits,
psychiatric services, emergency care facility services, and
critical care services.
Proposed Law
The provision would improve the ability of the Secretary to
screen for waste, fraud, and abuse by requiring the Secretary
to establish a payment modifier for evaluation and management
services that result in the ordering of additional services
(i.e. lab tests), prescription drugs, durable medical
equipment, or other services determined by the Secretary to be
at high risk of fraud, waste, and abuse. The Secretary would be
authorized to require providers and suppliers to report the
payment modifier on claims.
Sec. 1634. Evaluations and reports required under Medicare Integrity
Program
Current Law
Medicare statute authorizes the establishment of the
Medicare Integrity Program (MIP). MIP requires the Secretary to
enter into contracts with private entities to conduct a variety
of program integrity activities for the Medicare program
including auditing providers, reviewing claims for medical
necessity, and identifying and investigating alleged fraud. MIP
was established along with the HCFAC program by HIPAA, which
sought to increase and stabilize federal funding for health
care anti-fraud activities.
The Medicaid Integrity Program is modeled after Medicare's
MIP program. The Medicaid Integrity Program provides HHS with
dedicated resources to promote Medicaid integrity to contract
with entities to reduce fraud, waste, and abuse and to add 100
full-time equivalent staff. Annual reports to Congress on
program accomplishments and use of funds are required. In
addition, the Secretary is required to develop comprehensive 5-
year plans for the program.
Proposed Law
The new provision is designed to increase the
accountability and effectiveness of MIP contractors. For the
contract year beginning in 2011, this provision would require
MIP contractors to assure the Secretary that they will conduct
periodic evaluations of the effectiveness of their activities.
Annual reports would be required to be submitted to the
Secretary. A similar provision with respect to the Medicaid
Integrity Program would be included in Section 1752 of this
bill.
Sec. 1635. Require providers and suppliers to adopt programs to reduce
waste, fraud, and abuse
Current Law
Since 1998, the OIG has been issuing a series of compliance
guidance documents for providers participating in federal
health care programs to assist in preventing fraud, waste, and
abuse. The purpose of the documents is to encourage health care
providers to adopt compliance programs and internal control
measures to monitor their adherence to applicable rules,
regulations, and requirements. The adoption of these programs
is not mandatory. There is no current law explicitly directing
health care providers to adopt compliance programs.
Proposed Law
This provision would require providers and suppliers to
establish compliance programs to reduce fraud, waste, and
abuse, supplementing the ability of the Secretary and law
enforcement authorities to uncover program waste, fraud, and
abuse. Providers and suppliers that do not meet requirements
for establishing these programs would be subject to certain
sanctions. The provision would also authorize the Secretary to
conduct a pilot program, prior to mandating these requirements
to all providers, to test the establishment of compliance
programs for providers that the Secretary has determined to be
a high risk for fraud, waste, and abuse.
The Secretary, in consultation with the OIG, would be
required to establish the core requirements for provider
compliance programs. Requirements may include written policies,
procedures, and standards of conduct; a designated compliance
officer and compliance committee; training and education on
fraud, waste and abuse for employees and contractors; a
confidential mechanism (i.e. hotline) for receiving compliance
questions and reports; guidelines for enforcing standards;
internal monitoring and auditing procedures applicable to
providers and contractors; and procedures for (1) ensuring
prompt responses to detected and potential offenses, (2)
developing corrective action initiatives, and (3) returning all
identified Medicare, Medicaid, and CHIP overpayments. The
Secretary would be required to develop a timeline for the
establishment of these requirements and the date by which
providers and suppliers would be required to have a compliance
program in place.
The CMS Administrator would have the authority to assess
whether or not a provider or supplier has met these
requirements and impose a CMP of up to $50,000 for each
violation. The Secretary would have the authority to impose
other intermediate sanctions, such as corrective action plans
and additional monitoring, on providers and suppliers for
failing to meet these requirements. The provision would also
give the Secretary the authority to disenroll a Medicare
provider or supplier, or impose a CMP or intermediate sanction,
on any provider or supplier who fails to establish a compliance
program.
The provisions of this section would not apply to
individual physicians or skilled nursing facilities, although
nursing facilities would be required to develop compliance
programs under Section 1412 of this Act.
Sec. 1636. Maximum period for submission of Medicare claims reduced to
not more than 12 months
Current Law
Medicare statute requires that payments only be made,
except in certain circumstances, to Medicare eligible providers
and only if a written request for payment is filed within three
calendar years after the year in which the services were
provided. The Secretary is authorized to reduce this period to
no less than one year if it deems it necessary for the
efficient administration of the program.
As established by CMS regulations, in general, the time
limit on submitting a claim for payment is the close of the
calendar year after the year in which the services were
furnished. For services furnished in the first nine months of
the year, claims must be submitted on or before December 31 of
the following year. For services furnished in the last three
months of a calendar year, claims must be submitted to the
contractor on or before December 31 of the second year
following the year services were furnished.
Proposed Law
The provision is designed to reduce the ability of Medicare
providers to game the system by testing payment systems to
determine which payments are or are not approved, and tailor
filings to prevent waste, fraud, and abuse from being
identified. The provisions would reduce the time period for
filing a written request for payment from three calendar years
to one calendar year for services provided under Medicare Parts
A and B. The Secretary would have the authority to specify
exceptions to this one year period. The provision would
eliminate the current statutory requirement that the Secretary
must give Medicare Part A and B eligible providers at least one
year to submit a claim for payment. The provision would also
add a new requirement for MA and PDP plans. Contracts with MA
organizations and PDP sponsors would be required to mandate
that any provider under contract with, in partnership with, or
affiliated with the MA organization or PDP sponsor ensure that
a written request for payment be submitted no later than one
calendar year after the date the services were furnished. The
Secretary would have the authority to specify exceptions to
this one-year period.
The provision would apply to services furnished on or after
January 1, 2011.
Sec. 1637. Physicians who order durable medical equipment or home
health services required to be Medicare-enrolled physicians or
eligible professions
Current Law
Medicare statute defines eligible professional as a
physician, certain types of practitioners (i.e. physician
assistant, nurse practitioner, clinical social worker, and
others), a physical or occupational therapist, qualified speech
language pathologist, or a qualified audiologist.
CMS has implemented regulations requiring Medicare
providers and suppliers to submit an application to enroll in
the Medicare program in order to receive billing privileges.
Providers and suppliers must resubmit and recertify the
accuracy of their enrollment information every 5 years. CMS may
deny a provider or supplier's enrollment in Medicare or revoke
a provider's billing privileges for the following reasons: non-
compliance with enrollment requirements, exclusion from
participation in federal health care programs, conviction of a
felony, or the submission of false or misleading information on
the enrollment application.
In order to receive payment from Medicare, physicians are
required to certify that specified services (i.e. inpatient
psychiatric services, post-hospital extended care services, and
home health services) meet certain conditions. In the case of
home health services, physicians are required to certify that
such services were required because the individual was confined
to his home and needs skilled nursing care or physical, speech,
or occupational therapy; a plan for furnishing services to the
individual has been established; and such services were
provided under the care of a physician.
In the case of DME, the Secretary is authorized to require,
for specified covered items, that payment be made for items and
services only if a physician has communicated to the supplier a
written order for the item.
Proposed Law
Beginning January 1, 2010, this provision would require
physicians who order durable medical equipment or home health
services to be a Medicare eligible professional or enrolled in
the Medicare program. The Secretary would have the authority to
extend these requirements to other Medicare items and services,
including covered Part D drugs, based on a determination that
such application would help to reduce the risk of fraud, waste,
and abuse.
Sec. 1638. Requirement for physicians to provide documentation on
referrals to programs at high risk of waste and abuse
Current Law
OIG has ``permissive'' authority to exclude an entity or an
individual from a federal health program under numerous
circumstances, including failing to supply documentation
related to payment for items and services.
Proposed Law
This provision would assist investigations by improving the
quality of documentation required by those who order or request
payment for program areas that are at risk of waste, fraud, and
abuse. Beginning January 1, 2010, the Secretary would have the
authority to disenroll, for no more than one year, a Medicare
enrolled physician or supplier that fails to maintain and
provide access to written orders or requests for payment for
DME, certification for home health services, or referrals for
other items and services as specified by the Secretary, to the
Secretary. Medicare providers would be required to maintain and
provide access to documentation relating to written orders or
requests for payment for DME, certifications for home health
services, or referrals for items and services as specified by
the Secretary, to the Secretary. The provision would also
extend the OIG's permissive exclusion authority to include
individuals or entities that order, refer, or certify the need
for health care services that fail to provide adequate
documentation to the Secretary to verify payment.
Sec. 1639. Face-to-face encounter with patient required before
physicians may certify eligibility for home health services or
durable medical equipment under Medicare
Current Law
Home health services are covered under Medicare Parts A and
B. In order to receive payment from Medicare, physicians are
required to certify and re-certify that specified services
(i.e. inpatient psychiatric services, post-hospital extended
care services, and home health services) meet certain
conditions. In the case of home health services, physicians are
required to certify that such services were required because
the individual was confined to his home and needs skilled
nursing care or physical, speech, or occupational therapy; a
plan for furnishing services to the individual has been
established; and such services were provided under the care of
a physician.
In the case of DME, the Secretary is authorized to require,
for specified covered items, that payment be made for items and
services only if a physician has communicated to the supplier a
written order for the item.
Proposed Law
This provision would require that after January 1, 2010,
physicians have a face-to-face encounter (including through
telehealth and other than with respect to encounters that are
incident to services involved) with the individual prior to
issuing a certification or re-certification for home health
services or durable medical equipment as a condition for
payment under Medicare Parts A and B. The provision would also
apply to physicians making home health certifications in
Medicaid and CHIP. Physicians must document that they had the
face-to-face encounter with the individual during the 6-month
period preceding the certification, or other reasonable
timeframe as determined by the Secretary. This section is meant
to be compatible with the National Coverage Provision, PHYS-
004, subsection H, which states that in medically underserved
areas, physicians may send physician extenders (physician
assistants or nurses) to see patients in their homes without
personal or direct supervision by the physician, and the
physician may then bill that service as a physician service.
The Secretary would be authorized to apply the face-to-face
encounter requirement to other Medicare items and services
based upon a finding that doing so would reduce the risk of
waste, fraud, and abuse.
Sec. 1640. Extension of testimonial subpoena authority to program
exclusion investigations
Current Law
Section 1128 of the SSA provides that the Secretary (and
through delegation, OIG) has the authority to exclude
individuals and entities from participation in federal health
care programs under a variety of circumstances. Exclusion is
mandatory for those convicted of certain criminal offenses, and
generally the exclusion cannot be for a period of less than
five years. OIG also has permissive authority under numerous
circumstances to exclude an individual or entity from a federal
health program, including the discretion to determine whether
and for how long an exclusion will be imposed.
Proposed Law
The provision is designed to increase the ability of the
Secretary to conduct program investigations, applying the
subpoena provisions contained in section 205(d) and (e) of the
SSA with respect to the Secretary's program exclusion
authority. The Secretary would be able to issue subpoenas and
require the attendance and testimony of witnesses and the
production of any other evidence that relates to matters under
investigation or in question by the Secretary. The Secretary
would also have the ability to delegate this authority to the
OIG and the Administrator of CMS for the purposes of a program
exclusion investigation. Certain requirements regarding the
serving of subpoenas and compensation for subpoenaed witnesses
may apply. This section would also provide for judicial
enforcement of subpoenas, including in cases where a person
refuses to obey a properly served subpoena. This provision
would apply to investigations beginning on or after January 1,
2010.
Sec. 1641. Required repayments of Medicare and Medicaid overpayments
Current Law
The Secretary is authorized to enter into contracts with
private entities to conduct administrative functions, including
audits of Medicare participating providers and suppliers to
identify alleged overpayments. These entities are generally
referred to as Medicare program integrity or MIP contractors.
Medicare statute specifies that identified overpayments to
providers or suppliers that are not paid within 30 days of the
date of the overpayment determination will accrue interest on
the balance of the overpayment at the rate applicable to late
payments established by the Secretary of the Treasury. The
Secretary is required to enter into repayment plans with
providers for which payment within 30 days would constitute a
financial hardship. In the case of a provider or supplier for
which an overpayment has been identified seeks a
reconsideration (the 2nd level of the Medicare appeals
process), the Secretary is prohibited from recouping the
overpayment until a decision on the reconsideration has been
rendered.
Proposed Law
This provision would require the repayment of overpayments
identified by Medicare and Medicaid participating providers,
including private health plans. The term ``overpayment'' would
be defined as any funds that a person receives or retains under
Medicare or Medicaid of which they are not entitled. Person
would be defined as any ``person'' including a provider of
services, supplier, Medicaid managed care organization, MA
organization, or PDP sponsor. Any person who knows of an
overpayment would be required to report and return the
overpayment, along with notification for the reason for the
overpayment, to the Secretary, the state, an intermediary, a
carrier, or a contractor. ``Knows'' under this provision means
that a person with respect to information has actual knowledge
of the information, acts in deliberate ignorance of the truth
or falsity of the information, or acts in reckless disregard of
the truth or falsity of the information. An overpayment is
defined as funds that a person receives or retains under
Medicare, Medicaid, or CHIP to which the person, after
applicable reconciliation, is not entitled. The reference to
applicable reconciliation in this definition refers to
reconciliations procedures already be in place for the relevant
programs and payments, and is not intended to create any new
required reconciliation procedures or rights to reconciliation
or appeal. Overpayments would be required to be reported and
returned within 60 days of the date the person knows of the
overpayment. Overpayments retained after the 60 days would
create an obligation as defined in USC section 3729(b)(3) of
title 31. If it is determined that the reason for the
overpayment was related to fraud, repayment would not limit the
provider or supplier's liability for additional administrative
obligations such as interest, fines, specialties, or civil and
criminal sanctions.
Sec. 1642. Expanded application of hardship waivers for OIG exclusions
to beneficiaries of any Federal health care program
Current Law
Under SSA section 1128, the Secretary (and, through
delegation, OIG) has the authority to exclude individuals and
entities from participation in federal health care programs.
Exclusions from federal health programs are mandatory under
certain circumstances, and permissive in others (i.e., OIG has
discretion in whether to exclude an entity or individual). For
purposes of section 1128, the term ``federal health care
program'' means (1) any plan or program that provides health
benefits, whether directly, through insurance, or otherwise,
which is funded directly, in whole or in part, by the United
States government other than the health insurance program under
chapter 89 of title 5, United States Code (governing health
insurance for federal employees); or (2) any state health care
program, as defined by the Social Security Act.
Subject to exceptions, in the case of a mandatory
exclusion, the minimum period of exclusion cannot be less than
five years. However, under SSA section 1128(c)(3)(B), upon the
request of a federal health care program administrator who
determines that the exclusion would impose a hardship on
individuals entitled to benefits under Medicare Part A or
enrolled under Medicare Part B (or both), the Secretary may
waive the exclusion under certain circumstances with respect to
that program, in the case of an individual or entity that is
the sole community physician or sole source of essential
specialized services in a community.
Proposed Law
This new provision would increase the ability of the
Secretary to use discretion to protect beneficiaries in cases
where providers are subject to program exclusion. Under SSA
section 1128(c)(3)(B), the Secretary would, in accordance with
the requirements of the section, be able to waive a mandatory
exclusion period where a hardship is imposed on beneficiaries
of other federal health care programs, in addition to Medicare
Part A and Part B beneficiaries.
Sec. 1643. Access to certain information on renal dialysis facilities
Current Law
None.
Proposed Law
This provision is designed to allow additional oversight of
financial relationships that may exist between medical
directors and dialysis organizations, and the extent to which
these may affect prescribing decisions. This provision would
require End State Renal Disease Facilities to provide the
Secretary with access to information relating to any ownership
or compensation arrangement between the facility and the
medical director of such facility or between the facility and
any physician for the purposes of an audit or evaluation.
Sec. 1644. Billing Agents, Clearinghouses, or Other Alternate Payees
Required to Register Under Medicare
Current Law
CMS has implemented regulations requiring Medicare
providers and suppliers to submit an application to enroll in
the Medicare program in order to receive billing privileges.
Providers and suppliers must resubmit and recertify the
accuracy of their enrollment information every 5 years. The
enrollment application requires that providers and suppliers
include the names, addresses, and tax ID numbers for billing
agencies on their applications.
Proposed Law
This provision is designed to reduce waste, fraud, and
abuse by providing for registration of financial intermediaries
that handle payments for Medicare providers. Beginning January
1, 2012, this provision would require billing agencies,
clearinghouses, or other payees that submit claims on behalf of
a health care provider to register with the Secretary in a form
and manner as determined by the Secretary. A similar provision
is put in place with respect to the Medicaid program by section
1759 of this Act.
Sec. 1645. Conforming civil monetary penalties to False Claims Act
amendments
Current Law
SSA section 1128A(a) authorizes the imposition of civil
monetary penalties (CMPs) on any person, including an
organization, agency, or other entity, who engages in various
types of improper conduct with respect to federal health care
programs. Under 1128A(a)(1), CMPs may be imposed on any person
who knowingly presents or causes to be presented to certain
government officers, employees, agents, or agencies certain
false or fraudulent claims for items or services. As defined by
section 1128A(i), an item or service includes any particular
item, device, medical supply, or service purportedly provided
to a patient and listed in an itemized claim for payment. A
claim is defined by this section as an application for payments
for items and services under a federal health care program.
Section 1128A generally provides for monetary penalties of
up to $10,000 for each item or service claimed, and $15,000 or
$50,000 under other circumstances, as well as additional
assessments. Under Section 1128A(a)(4), certain persons
excluded from participating in Medicare or a state health care
program who retain a direct or indirect ownership or control
interest in an entity that is participating in Medicare or a
state health care program and know or should know of the action
constituting the basis for the exclusion, or who are an officer
or managing employee of such an entity, may be subject to civil
penalties.
SSA section 1128A(c)(1) provides that the Secretary may
initiate a proceeding to determine whether to impose a civil
monetary penalty, assessment, or exclusion under the section
only as authorized by the Attorney General pursuant to
procedures agreed upon by them. The Secretary may not initiate
an action with respect to any claim, request for payment, or
other occurrence described in this section later than six years
after the date the claim was presented, the request for payment
was made, or the occurrence took place.
The federal False Claims Act (FCA), codified at 31 U.S.C.
Sec. Sec. 3729-3733, provides for judicial imposition of CMPs
and damages for the knowing submission of false claims to the
United States government. The recently enacted Fraud
Enforcement and Recovery Act of 2009 (FERA), P.L. 111-21, made
several amendments to the False Claims Act that, according to
legislative history, were intended to clarify the meaning of
several provisions of the FCA in light of judicial
interpretations of the statute that were said to run contrary
to congressional intent and limit the scope of the law. Among
the changes made by FERA, the Act removed a requirement under
30 U.S.C. 3729(a)(1) that provided that in order for liability
to attach, a false claim must be presented ``to an officer or
employee of the United States Government or a member of the
Armed Forces of the United States.'' In addition, FERA expanded
the definition of the term ``claim'' to include to include
``any request or demand, whether under a contract or otherwise,
for money or property and whether or not the United States has
title to the money or property, that . . . is made to a
contractor, grantee, or other recipient, if the money or
property is to be spent or used on the Government's behalf or
to advance a Government program or interest, and if the
Government provided or has provided any portion of the money or
property requested or demanded.''
Proposed Law
This provision is designed to conform and ensure
consistency between the OIGs CMP authority and the recently
amended False Claims Act. Similar to FERA, the bill would amend
section 1128A(a)(1) to remove the requirement for presentment
of a claim to a government officer, employees, agents, or
agencies in order to be liable for CMPs. The bill would also
expand the reach of section 1128A(a)(4), under which a person
excluded from participating in a federal health care program
(in addition to Medicare or a state health care program) who
retains ownership in an entity participating in the program, or
is an officer or managing employee of such an entity, would be
subject to CMPs. The bill would create a new section
1128A(a)(12), which would impose CMPs on a person who conspires
to commit a violation of section 1128A. Persons violating
section 1128A(a)(12) would be subject to a penalty of up to
$50,000 for violations of the section and an additional
assessment of no more than three times the total amount that
would otherwise apply. In addition, a new section 1128A(a)(13)
would provide that a person who knowingly makes, uses, or
causes to be made or used, a false record or statement material
to an obligation to pay or transmit money or property to a
federal health care program, or knowingly conceals or knowingly
and improperly avoids or decreases an obligation to pay or
transmit money or property to a federal health care program can
be subject to CMPs. Penalties under this section would be up to
$50,000 for each false record or statement, concealment,
avoidance, or decrease. Persons would also be subject to an
assessment of no more than three times the total amount of the
obligation under certain circumstances.
Under section 1128A(c)(1), the Secretary could initiate a
proceeding to determine whether to impose a civil monetary
penalty, assessment, or exclusion for an occurrence up to ten
years, instead of six, after the occurrence took place.
The bill would also amend certain definitions in section
1128A(i). For example, under 1128(i)(2), the definition of a
claim would be broadened to include any application, request,
or demand, whether under contract, or otherwise, for money or
property for items and services under a federal health care
program, whether or not the United States or a State agency has
title to the money or property, that is presented or caused to
be presented to a government officer, employee, agent or
agency. A claim under this section would also include
applications, requests, or demands made to a contractor,
grantee, or other recipient, if the money or property is to be
spent or used on the federal health care program's behalf or to
advance a federal health care program interest, and if the
federal health care program (1) provides or has provided any
portion of the money or property requested or demanded; or (2)
will reimburse such contractor, grantee, or other recipient for
any portion of the money or property which is requested or
demanded. In addition, an ``item or service'' would include,
without limitation, any medical, social, management,
administrative, or other item or service used in connection
with or directly or indirectly related to a federal health care
program.
Subtitle D--Access to Information Needed to Prevent Fraud and Abuse
Sec. 1651. Access to information necessary to identify waste and abuse
Current Law
Statutory OIGs consolidate responsibility for audits and
investigations within a federal agency. The Inspector General
Act of 1978 and its amendments of 1988 granted inspectors
general substantial independence and powers to carry out their
mandate to combat waste, fraud, and abuse. In carrying out
their functions, IGs have relatively unlimited authority,
including subpoena power, to access all records and information
of an agency.
Every contract with a PDP or MA-PD (Medicare Advantage
Prescription Drug Plan) is required to provide the Secretary
with the right to inspect and audit any books and records of
the plan related to costs. Officers, employees, and HHS
contractors may use information obtained or disclosed during an
audit for the purposes of conducting the audit only.
Proposed Law
The provision would establish that the Attorney General has
access to Medicare and Medicaid claims and payment data,
facilitated by the HHS OIG and in consultation with CMS or the
owner of any such data. Access would be required to be carried
out for the purposes of law enforcement activity and in a
manner consistent with any applicable disclosure, privacy, and
security laws, including the HIPAA and Privacy Act of 1974, and
subject to any statutory information systems security
requirements in statute or mandated by the Secretary. Nothing
in this section shall be construed as setting forth an
exclusive avenue for obtaining data in civil and criminal fraud
investigations. Nor does the section apply to state attorneys
general.
Sec. 1652. Elimination of duplication between the Healthcare Integrity
and Protection Data Bank and the National Practitioner Data
Bank
Current Law
Medicare statute requires the Secretary to develop and
maintain a national health care fraud and abuse data collection
program for the reporting of adverse actions taken against
health care providers or suppliers. The OIG issues regulations
implementing the Health Care Integrity and Protection Data Bank
(HIPDB). The statute requires the following types of health
care related adverse actions to be reported: civil judgments,
federal or state criminal convictions, actions taken by federal
or state licensing agencies, and provider exclusions from
Medicare and Medicaid. Only final adverse actions are
reportable to the HIPDB. Administrative fines, citations,
corrective action plans, and other personnel actions are not
reportable except under certain circumstances. Settlements, in
which a finding of liability has not been established, are also
not reportable. Both federal and state government agencies as
well as health plans are required to report to the HIPDB.
Health plans that fail to report are subject to a civil
monetary penalty of $25,000. The Secretary is authorized to
charge fees to access information in the database. However,
fees cannot apply to requests from federal entities. HIPDB
cannot duplicate the reporting requirements established for the
National Practitioner Data Bank.
Title IV of the Health Care Quality Improvement Act of
1986, as amended, established the National Practitioner Data
Bank (NPDB). The NPDB collects and releases data related to the
professional competence of physicians, dentists, and certain
healthcare practitioners. The types of information included in
the NPDB are medical malpractice claims payments, certain
adverse licensure actions, adverse clinical privileging
actions, adverse professional society membership actions, and
exclusions from Medicare and Medicaid. The statute defines the
entities eligible to report and query the databank. Malpractice
payers that fail to report are subject to a civil monetary
penalty. Section 1921 of the Social Security Act expanded the
scope of reporting requirements for the NPDB to encompass
additional adverse licensure actions and actions taken by state
licensing and certification agencies, peer review
organizations, and private accreditation organizations. Section
1921 also required that actions taken against all health care
practitioners be included in the databank. States are required
to have a system for reporting adverse actions to the NPDB. The
Health Resources and Services Administration (HRSA) within HHS
oversees both databases.
Proposed Law
This provision is designed to establish a timeline for the
process already underway of consolidation of existing waste,
fraud, and abuse data sources, ensuring the efficient use of
resources and greater access to data necessary for preserving
program integrity. Upon enactment of this Act, this provision
would require the Secretary to establish a process to terminate
the HIPDB. The Secretary would be required to ensure that the
information that was formerly collected in the HIPDB is
transferred to the NPDB.
Requirements pertaining to the establishment of the HIPDB,
such as rules for reporting information, the types of
information that are reported, and rules for disclosure, would
all apply to the NPDB upon termination of the HIPDB. The
provision would eliminate the OIG's responsibility for
reporting adverse actions to the database. After the Secretary
certifies that the transition of information from the HIPDB to
the NIPD is complete, any fees charged by the Secretary for
access to the database would apply to federal agencies. The
Department of Veterans Affairs (VA) would be exempted from
these charges for one year. The transition would be funded from
the fees collected to access the database and from additional
amounts as necessary from the annual HCFAC appropriation
available to the Secretary and the OIG. Funding would be
available for one year after the enactment date of this
legislation.
Sec. 1653. Compliance with HIPAA privacy and security standards
Current Law
The HIPAA Privacy and Security Rules were promulgated by
HHS pursuant to sections 262(a) and 264 of the Health Insurance
Portability and Accountability Act of 1996 (HIPAA) to establish
national standards for the privacy and security of protected
health information.
The HIPAA Privacy and Security Rules apply primarily to
covered entities--health plans, health care clearinghouses, and
health care providers who transmit financial and administrative
transactions electronically. Failure to comply with these
regulations may result in civil or criminal penalties for
covered entities. The HITECH Act, enacted as part of the
American Recovery and Reinvestment Act, extends civil and
criminal liability to business associates of covered entities
for violations that occur on or after February 17, 2010.
Business associates are defined as persons who perform, or
assist in the performance of a function or activity involving
the use or disclosure of individually identifiable health
information on behalf of a covered entity. Examples of business
associates include persons who perform legal, actuarial,
accounting, consulting, data aggregation, management,
administrative, accreditation, or financial services to or for
such covered entity where the provision of the service involves
the disclosure of individually identifiable health information
from such covered entity or arrangement, or from another
business associate of such covered entity or arrangement, to
the person.
The HIPAA Privacy Rule governs the disclosure of protected
health information (PHI)--that is, individually identifiable
health information ``created or received by a [covered
entity]'' that ``[r]elates to the . . . health or condition of
an individual'' or to the provision of or payment for health
care. A covered entity is permitted to use or disclose PHI
without patient authorization for treatment, payment, or health
care operations. For other purposes, a covered entity may only
use or disclose PHI with patient authorization subject to
certain exceptions. Exceptions permit the use or disclosure of
PHI without patient authorization or prior agreement for public
health, judicial, law enforcement, and other narrow purposes.
The HIPAA Privacy Rule also requires covered entities and
business associates to provide an accounting of certain
disclosures; to make reasonable efforts to disclose only the
minimum information necessary; to safeguard PHI from
inappropriate use or disclosure; and to provide a notice of
their privacy practices. Individuals also have a right to
review and obtain copies of their PHI and to request
corrections.
The HIPAA Security Rule applies only to PHI in electronic
form (EPHI), and requires a covered entity or business
associate to maintain administrative, technical, and physical
safeguards to ensure the confidentiality, integrity, and
availability of all EPHI the covered entity creates, receives,
maintains, or transmits.
The HITECH Act will also impose a breach notification
requirement that is triggered when unsecured PHI or EPHI is
compromised. This requirement is applicable to both covered
entities and business associates and will become effective 30
days after HHS issues final regulations implementing this
requirement.
The Privacy Act of 1974 generally prohibits disclosures of
records contained in a system of records maintained by a
federal agency without the written request or consent of the
individual to whom the record pertains. A system of records is
a group of records under the control of an agency from which
information is retrieved by the name of the individual or by
some identifier assigned to the individual, such as a Social
Security Number. The Privacy Act contains certain statutory
exceptions, and a list of agency systems of records, including
the routine uses of those records, is published in the Federal
Register.
Proposed Law
The provision would mandate compliance with HIPAA privacy
and security requirements and the Privacy Act of 1974 in
carrying out the provisions of this subtitle.
TITLE VII--MEDICAID AND CHIP
Subtitle A--Medicaid and Health Reform
Sec. 1701. Eligibility for individuals with income below 133\1/3\
percent of the Federal poverty level
Current Law
Medicaid provides federal matching funds to states for the
costs of covered health and long-term care services furnished
to eligible low-income individuals. In order to qualify for and
be entitled to these federal matching funds, states must cover
certain groups, such as pregnant women and children under age 6
with family incomes at or below 133% of the federal poverty
level (FPL). These are known as ``mandatory'' groups. In
addition, states may extend Medicaid coverage to certain
groups, such as pregnant women and children under 6 with family
incomes above 133% of FPL. These are known as ``optional''
groups, and states are entitled to receive federal matching
funds for the costs of covered services to these populations.
In 2009, 133% of FPL is $14,404 per year for an individual and
$29,326 for a family of four.
There is one group of low-income people for whom federal
Medicaid law does not allow states to receive federal Medicaid
matching funds, regardless of their degree of impoverishment.
These are adults who are not elderly, not disabled, not
pregnant, and not parents of dependent children; they are
sometimes referred to as ``childless adults.'' The only way in
which states may receive federal Medicaid matching funds for
the costs of providing health or long-term care services to
these individuals is under a section 1115 demonstration waiver
granted by the Secretary of HHS.
Proposed Law
The bill would add two new mandatory eligibility groups to
Medicaid effective January 1, 2013. A new ``non-traditional''
group would consist of individuals under age 65 who do not meet
existing categorical requirements for eligibility (e.g.,
childless adults) with family income up to 133\1/3\% of FPL.
States would determine income using methodologies and
procedures specified by the Secretary of HHS in consultation
with the Health Choices Commissioner. The purpose of the
consultation would be to align as closely as possible the
income eligibility determinations for Medicaid with the income
eligibility determinations for affordability credits in the
Exchange. For the same reason, the non-traditional Medicaid
eligibles would not be subject to an assets or resource test.
A new ``traditional'' group would consist of individuals
under age 65 with family income up to 133\1/3\% of FPL who meet
the existing categorical requirements for eligibility (e.g.,
children, pregnant women, parents with dependent children, and
individuals with disabilities) but do not meet income
eligibility rules (standards, methodologies, and procedures) in
effect in their state as of June 16, 2009. As in the case of
non-traditional Medicaid eligibles, these traditional Medicaid
eligibles would not be subject to an assets or resource test,
even if the state applied such an eligibility requirement on or
before June 16, 2009.
The federal Medicaid matching rate for the cost of covered
services furnished to both the new non-traditional and
traditional groups of Medicaid-eligible individuals would be
100% in 2013 and 2014, and 90% thereafter. This matching rate
would apply to the cost of services for these new groups in
every state, whether or not a state currently covers some or
all of this population under a section 1115 waiver or only with
state funds.
Section 205(d)(1) of the bill provides that children born
in the United States who are not otherwise eligible for
acceptable coverage at birth are deemed to have enrolled in
Medicaid as a non-traditional Medicaid eligible for the first
60 days of life. (Acceptable coverage is defined in section
202(d)(2) of the bill.) The costs of care incurred by state
Medicaid programs during this period would be matched by the
federal government at a 100% rate in 2013 and 2014, then 90%
thereafter. Section 205(d)(2) of the bill provides that if, at
the end of the 60-day period, a newborn does not have
acceptable coverage, the newborn will continue to be deemed a
non-traditional Medicaid eligible until the child obtains other
acceptable coverage or the child is determined to be eligible
for Medicaid. This section provides that the cost of care
during this continuation period would be matched by the federal
government at a 100% rate in 2013 and 2014, then 90%
thereafter.
The bill would prohibit a state from requiring non-
traditional Medicaid eligibles to enroll in a Medicaid managed
care organization (MCO) or primary care case management program
(PCCM) until the state demonstrates, to the satisfaction of the
Secretary, that the MCO or PCCM has the capacity to meet the
health, mental health, and substance abuse needs of such
individuals, whether through its provider network or through
other arrangements. The purpose of this requirement is to avoid
a repetition of the waste of federal Medicaid funds that has in
the past occurred when Medicaid populations have been required
to enroll in MCOs that do not have adequate capacity to furnish
the services for which they are receiving capitation payments.
The effective date of this section would be the first day
of fiscal year 2013; it would apply to all items and services
furnished on or after that date.
Sec. 1702. Requirements and special rules for certain Medicaid eligible
individuals
Current Law
There are no provisions in current Medicaid law relating to
the Health Choices Administration or the Health Insurance
Exchange established by the bill.
Proposed Law
The bill provides assistance to low-income individuals in
affording health coverage through Medicaid or through
affordability credits within the Health Insurance Exchange. In
order to minimize procedural and bureaucratic barriers to such
assistance, the bill requires coordination between the Health
Choices Commissioner and the various state Medicaid programs.
The purpose is to ensure a ``single portal'' to coverage--i.e.,
whether an individual initially seeks coverage through a
Medicaid eligibility site or through the Exchange, the
individual's application will be promptly processed and the
individual will be enrolled in the coverage appropriate to his
or her family income without the need to reapply at a different
venue.
To this end, section 205(e)(3) of bill directs the Health
Choices Commissioner, in consultation with the Secretary of
HHS, to enter into a Medicaid memorandum of understanding (MOU)
with each state Medicaid agency in order to coordinate
enrollment in and implementation of Medicaid and the Exchange.
This section of the bill imposes a reciprocal requirement on
state Medicaid programs, as a condition of receiving federal
matching funds, to enter into a Medicaid MOU with the Health
Choices Commissioner to coordinate the implementation of
Medicaid and the Exchange in order to ensure the enrollment of
Medicaid-eligible individuals in acceptable coverage.
The MOU would implement a number of requirements designed
to maximize participation in Medicaid by eligible individuals.
First, state Medicaid programs would be required to accept
without further determination the enrollment of non-traditional
Medicaid eligible individuals who are determined eligible for
Medicaid by the Exchange. Any redeterminations of eligibility
by the state Medicaid agency would have to be consistent in
periodicity with the periodicity for redeterminations of
eligibility for affordability credits in the Exchange.
State Medicaid programs would also be required to accept
without further determination the enrollment of an individual
determined by the Commissioner to be a traditional Medicaid
eligible individual. As in the case of non-traditional Medicaid
eligibles, the state would conduct redeterminations of
eligibility for these individuals consistent with the
periodicity of the redeterminations of eligibility for
affordability credits in the Exchange.
If the Commissioner determines that a state Medicaid agency
has the capacity to make determinations of eligibility for
affordability credits, then the MOU would provide for the state
Medicaid agency to perform that function, and the Commissioner
must reimburse the state Medicaid agency for the costs of
conducting such determinations. Under this arrangement, the
state Medicaid agency must make an eligibility determination
for affordability credits for any Exchange-eligible individual
who requests such a determination. If the state Medicaid agency
determines that an Exchange-eligible individual is not eligible
for affordability credits, the agency must forward the
information on the basis of which such determination was made
to the Commissioner. Errors by the state Medicaid agency in
making eligibility determinations for affordability credits
would not be included in the calculation of erroneous excess
payments for purposes of Medicaid or CHIP.
The Committee expects that, consistent with the
requirements described above, these Medicaid MOUs will be
tailored to the operational circumstances of both the Medicaid
program and the Exchange in each state. Neither the
Commissioner nor the state Medicaid agencies have the authority
to modify or vitiate any state Medicaid plan requirement under
federal law in the MOU.
Section 205(d)(1) of the bill provides that children born
in the United States who are not otherwise eligible for
acceptable coverage at birth are deemed to have enrolled in
Medicaid as a non-traditional Medicaid eligible for the first
60 days of life. Section 205(d)(2) of the bill provides that
if, at the end of the 60-day period, a newborn does not have
acceptable coverage, the newborn will continue to be deemed a
non-traditional Medicaid eligible until the child obtains other
acceptable coverage or the child is determined to be eligible
for Medicaid. This section of the bill requires that the state
Medicaid agency conduct a Medicaid eligibility determination
for such newborns within the first 60 days after birth. In
order to avoid any loss of coverage, it also deems newborns who
are not otherwise covered under acceptable coverage at the end
of the 60-day period to be eligible for Medicaid as a
traditional Medicaid eligible (with federal matching rates
appropriate to this eligibility group) until the child either
obtains acceptable coverage or is otherwise determined eligible
for Medicaid.
Sec. 1703. CHIP and Medicaid maintenance of eligibility
Current Law
State participation in the Medicaid program and in the
Children's Health Insurance Program (CHIP) is voluntary. States
that elect to participate in either program must meet certain
federal statutory requirements in order to receive federal
matching funds for the allowable costs they incur in purchasing
covered items and services on behalf of program beneficiaries.
All states currently participate in both programs. The Medicaid
program is permanent. The CHIP program expires on September 30,
2013.
Within federal requirements, states have flexibility to
determine which eligibility standards, methodologies, and
procedures they use in administering their programs. The of the
American Recovery and Reinvestment Act of 2009, P.L. 111-5,
provides an increase in federal Medicaid matching rates for
states during the period October 1, 2008, through December 31,
2010. Under the American Recovery and Reinvestment Act (ARRA)
maintenance of eligibility requirement, a state is not eligible
for the increased federal matching payment if its Medicaid
eligibility standards, methodologies, or procedures are more
restrictive than those in effect as of July 1, 2008. The
Centers for Medicare & Medicaid Services has issued
administrative guidance implementing this requirement (SMD #09-
005, August 19, 2009).
Proposed Law
The bill would require states, as a condition of receiving
federal Medicaid funds, to maintain eligibility standards,
methodologies, or procedures under their CHIP programs
(including those operating under section 1115 waivers) that are
no more restrictive than those in effect as of June 16, 2009.
This requirement would not prohibit states with stand-alone
CHIP programs from limiting the acceptance of applications or
imposing numerical limitations or waiting lists in order to
limit its CHIP spending in a fiscal year to amounts for which
federal CHIP matching funds are available for that fiscal year.
The Committee expects that, in implementing this
requirement, the Secretary will issue guidance parallel to that
set forth in the August 19, 2009, guidance implementing the
ARRA Medicaid maintenance of eligibility requirement. The
purpose of this requirement is to ensure that low-income
children and pregnant women who qualify for CHIP under current
eligibility rules will continue to qualify for coverage until
the Health Insurance Exchange is operational. The maintenance
of eligibility requirement does not prohibit states from
raising their CHIP eligibility standards or liberalizing their
CHIP eligibility methodologies or procedures in order to cover
more low-income children.
In order to ensure low-income children and pregnant women a
seamless transition from coverage under CHIP to coverage in the
Exchange, the CHIP maintenance of eligibility requirement would
apply from the first quarter after enactment to the CHIP MOE
termination date. This date is the later of January 1, 2013,
the day on which the Exchange becomes operational, or the day
after which both of the following determinations have been
made; first, the Health Choices Commissioner has determined
that the Exchange has the capacity to support CHIP enrollees
who are eligible for the Exchange; and second, the Secretary of
HHS has determined that comparable coverage is available
through the Exchange and that procedures have been established
for transferring CHIP enrollees into acceptable coverage
without interruption of coverage and without interruption of a
written plan of treatment. For this purpose, comparable
coverage means that benefits standards in the Exchange are at
least comparable to the benefits standards provided to children
under an average state CHIP plan as in effect in 2011. A CHIP
enrollee is a child or pregnant women who is eligible for CHIP
coverage or would be eligible but for acceptable coverage (as
defined in section 202(d)(2) of the bill).
The bill also includes a Medicaid maintenance-of-
eligibility requirement. Under this requirement, a state is not
eligible for federal Medicaid matching payments in any calendar
quarter beginning after enactment if the state has in effect
Medicaid eligibility standards, methodologies, or procedures
under the state's Medicaid plan (or under any section 1115
Medicaid waiver) that are more restrictive than the eligibility
standards, methodologies or procedures under the state's
Medicaid plan (or waiver) as in effect on June 16, 2009. The
Committee expects that, in implementing this requirement, the
Secretary will follow the August 19, 2009, guidance
implementing the ARRA Medicaid maintenance of eligibility
requirement. This Medicaid MOE requirement does not prohibit
states from changing their Medicaid eligibility standards or
methodologies or procedures so as to make them less restrictive
and thereby cover more low-income families and individuals. The
bill requires the Secretary to extend any section 1115 Medicaid
waiver, including the availability of federal Medicaid matching
funds under such a waiver, for as long as necessary for a state
to meet the maintenance of eligibility requirement.
The Secretary of HHS has granted a section 1115 waiver to
the State of Vermont that limits coverage for certain
individuals to payment of premium or cost-sharing subsidies for
individual or group health insurance coverage only. The bill
directs the Secretary to allow the State to amend the waiver to
apply more restrictive standards, methodologies, or procedures
to such individuals only and clarifies that such an amendment
would not violate the maintenance of eligibility requirement.
Under section 242 of the bill, individuals who are not
enrolled in an employer plan and are not eligible for Medicaid
may qualify for affordability credits to assist in the purchase
of health insurance coverage in the Exchange if their family
income is below 400% of the federal poverty level (FPL). No
assets or resource test will apply. In general, individuals and
families with incomes at or below 133% of FPL will be eligible
for Medicaid, and those with incomes above that level (but
below 400% of FPL) who are not eligible for Medicaid under the
MOE requirement will be eligible for affordability credits in
the Exchange.
In order to align eligibility determinations for Medicaid
with those for affordability credits so as to minimize
administrative burden and cost, the bill prohibits state
Medicaid programs from applying assets or resource tests in
determining eligibility for certain populations effective on
the day the Exchange becomes operational (January 1, 2013).
This prohibition applies to both initial Medicaid eligibility
determinations and redeterminations of new or existing
eligibles.
The populations that would not be subject to assets or
resource tests include the following mandatory populations: (1)
individuals who are receiving benefits under Title IV-A
(Temporary Assistance for Needy Families, TANF) or Title IV-E
(Foster Care or Adoption Assistance); (2) pregnant women,
infants, and children under age six with family income at or
below 133% of FPL; (3) children ages 6 through 18 with family
incomes at or below 100% FPL. They also include the following
optional populations: (1) pregnant women, infants, and children
with family income exceeding 133% FPL; (2) children ages 6
through 18 with family incomes above 100% FPL; (3) parents who
would be eligible if their work-related child care costs were
paid from their earnings; (4) optional targeted low-income
children under CHIP; (5) independent foster care adolescents.
Finally, these populations include parents and children in
families who meet the eligibility standards under the AFDC
programs that were in effect in their states on July 16, 1996,
and those who qualify under less restrictive income and
resource methodologies applied by their state. States could
continue to apply assets or resources tests to individuals 65
and over and individuals with disabilities who may require
long-term care services.
Section 121 of the bill requires that qualified health
benefits plans operating in the Exchange must offer coverage
that at least meets minimum benefits standards adopted by the
Secretary of HHS. In order to align this minimum benefits
standard with the floor on benefits in Medicaid, the bill
modifies the current law state option under section 1937 of the
Social Security Act relating to benchmark and benchmark-
equivalent coverage. Effective January 1, 2013, benchmark or
benchmark-equivalent coverage offered by a state Medicaid
program would be required to meet at least the minimum benefits
and cost-sharing standards of a basic plan offered through the
Exchange. The bill does not alter the current law limitations
on the populations to which a state may offer benchmark or
benchmark-equivalent coverage. Nor does it modify the current
law requirement that, with respect to children under 21,
benchmark or benchmark-equivalent coverage include Early and
Periodic Screening, Diagnostic, and Treatment (EPSDT) services.
Sec. 1704. Reduction in Medicaid DSH.
Current Law
In reimbursing hospitals for covered services furnished to
Medicaid patients, states must pay adjustments to hospitals
serving a disproportionate share of low-income patients (DSH
hospitals). States have flexibility in designating DSH
hospitals, but must include at least all hospitals meeting
either of two minimum criteria: (1) a Medicaid inpatient
utilization rate in excess of one standard deviation above the
mean rate for the state, or (2) a low-income patient
utilization rate of 25%. State payments to DSH hospitals
qualify for federal Medicaid matching funds at the state's
regular federal matching rate. The amount of federal Medicaid
matching funds for DSH payments available to each state in any
fiscal year is capped; each state's allotment is specified in
federal statute. Allotments of federal DSH matching funds to
all states totaled $11.3 billion in FY 2009.
Proposed Law
The bill would require the Secretary of HHS to reduce
federal Medicaid matching payments to states for Medicaid DSH
by a total of $10 billion over three years: $1.5 billion in
FY2017, $2.5 billion in FY2018, and $6.0 billion in FY2019.
This reduction in federal payments would be carried out through
a DSH Health Reform methodology issued by the Secretary. This
methodology would impose the largest percentage reductions in
federal DSH payments on states with the lowest percentages of
uninsured individuals (determined on the basis of audited
hospital cost reports) during the most recent year for which
such data are available and on states that do not target their
DSH payments on hospitals with high volumes of Medicaid
inpatients and hospitals that have high amounts of
uncompensated care (excluding bad debt).
To give the Congress an opportunity to review the
Secretary's DSH Health Reform methodology prior to its
implementation, the bill would require the Secretary to submit
a report to Congress not later than January 1, 2016, nine
months before the beginning of FY 2017. The report would
specify the DSH Health Reform methodology. The bill would also
require the Secretary to publish a notice in the Federal
Register setting forth the state-specific DSH allotment (as
determined by the DSH Health Reform methodology) for FY 2017 by
January 1, 2016. Similar notices would be required by January
1, 2017 for the FY 2018 DSH allotments, and by January 1, 2018
for the FY 2019 DSH allotments. The timing of these reports is
designed to give the Congress nine months to review the
proposed allotments for a coming fiscal year and to take any
needed corrective action before the reductions are implemented.
The Secretary's report would also discuss the extent to
which there is a continued role for Medicaid DSH payments in
light of the effectiveness of the health reforms carried out
under the bill in reducing the number of uninsured individuals.
The report would also include recommendations regarding (1) the
appropriate targeting of Medicaid DSH payments within states
and (2) the distribution of Medicaid DSH payments among states,
taking into account the ratio of the amount of DSH funds
allocated to a state to the number of uninsured individuals in
such states. In preparing the report, the Secretary would be
required to consult with community-based health care networks
serving low-income beneficiaries. The Secretary would also be
required to coordinate this report with the report on Medicare
DSH required under section 1112 of the bill (described above).
Finally, the bill would clarify that a hospital may not be
defined or deemed to be a Medicaid DSH hospital or an Essential
Access Hospital, and may therefore not receive Medicaid DSH
payments for which there is federal matching, unless the
hospital meets the following requirements: first, the hospital
must ensure that services in its facilities are provided to
Medicaid beneficiaries without discrimination on the ground of
race, color, national origin, creed, source of payment, status
as a Medicaid beneficiary, or any other ground unrelated to
such beneficiary's need for the services or the availability of
the needed services in the hospital; and second, the hospital
must make arrangements for, and accept, reimbursement for
services provided to Medicaid beneficiaries. These requirements
would apply with respect to Medicaid DSH payments made on or
after July 1, 2010.
Sec. 1705. Expanded outstationing
Current Law
State Medicaid programs must provide for the receipt and
initial processing of Medicaid eligibility applications for
low-income pregnant women, infants, and children under age 19
at locations other than welfare offices. These outstation
locations must include Medicaid disproportionate share (DSH)
hospitals and federally-qualified health centers (FQHCs). State
eligibility workers assigned to outstation locations perform
initial processing of Medicaid applications including assisting
applicants in completing the application, providing information
and referrals, obtaining required documentation to complete
processing of the application, ensuring that the information
contained on the application form is complete, and conducting
any necessary interviews. States must also use applications
which are other than those used for aid under Temporary
Assistance for Needy Families (TANF).
Proposed Law
There is evidence that the availability of outstation
locations for submitting applications facilitates Medicaid
enrollment by eligible individuals. In order to reduce the
number of individuals who are eligible for Medicaid but not
enrolled, the bill would require that state Medicaid programs
provide for the receipt and initial processing of Medicaid
eligibility applications at outstation locations by all
applicants, not just low-income pregnant women, infants, or
children under age 19. This requirement would generally be
effective July 1, 2010, whether or not final implementing
regulations are issued.
Low-income individuals who are not eligible for Medicaid
but are eligible for affordability credits in the Exchange may
receive health services at Medicaid DSH hospitals, FQHCs, or
other outstation locations. In order to facilitate receipt of
affordability credits by these individuals, the bill would
require state Medicaid programs to allow individuals to apply
for affordability credits through these same outstation
locations. The details of this outstation application process
would be set forth in the Medicaid memorandum of understanding
between each state Medicaid agency and the Commissioner of the
Health Insurance Exchange under section 1702(a) of the bill.
Subtitle B--Prevention
Sec. 1711. Required coverage of preventive services
Current Law
States that elect to participate in Medicaid and receive
federal matching funds must cover certain ``mandatory'' items
and services. In addition, states may receive federal matching
funds for the costs of covering certain ``optional'' items and
services. In the case of eligible children under age 21, states
must cover Early and Periodic Screening, Diagnostic, and
Treatment (EPSDT) services, which include a range of preventive
services for children. States may not impose copayments or
other cost-sharing on preventive services provided to children
under age 18 regardless of family income.
In the case of eligible adults, states may cover preventive
services, and they may impose cost-sharing on such services for
adults with incomes above 100% of the Federal Poverty Level.
For adults with family income between 100 and 150% of FPL,
cost-sharing cannot exceed 10% of the cost of the item or
service. For adults with family income above 150% of FPL, cost-
sharing cannot exceed 20% of the cost of the item or service.
States may allow providers to withhold services from
beneficiaries who do not pay their required cost-sharing
amounts.
The U.S. Preventive Services Task Force (USPSTF) reviews
the scientific evidence related to the effectiveness,
appropriateness, and cost-effectiveness of clinical preventive
services and issues recommendations to primary care clinicians
for the provision of services in their practices. The
recommendations are assigned one of five letter grades. Grade A
means there is a high certainty that the net benefit is
substantial. An example is screening all pregnant women for
tobacco use and providing augmented pregnancy-tailored
counseling to those who smoke. Grade B means there is high
certainty that the net benefit is moderate or there is moderate
certainty that the net benefit is moderate to substantial. An
example is screening mammography, with or without clinical
breast examination, every 1-2 years for women aged 40 and
older. In both Grade A and Grade B recommendations, the USPSTF
recommends that the clinician offer or provide the service.
Proposed Law
The bill would require state Medicaid programs to cover
preventive services that are not otherwise covered through the
EPSDT benefit for children under 21 and that the Secretary
determines are (1) recommended with a grade of A or B by the
Task Force on Clinical Preventive Services or are vaccines
recommended by the Director of the Centers for Disease Control
and Prevention, and (2) appropriate for Medicaid beneficiaries.
The Task Force for Clinical Preventive Services is the
statutory successor to the USPSTF established by section
2301(a) of the bill.
In order to promote the use of these evidence-based
clinical services, the bill would prohibit state Medicaid
programs from imposing any cost-sharing on a preventive
service, regardless of the family income of the beneficiary.
Both the requirement for the coverage of preventive services
and the prohibition against the imposition of cost-sharing on
such services would take effect July 1, 2010, except in cases
where the Secretary determines that a state must enact
legislation in order to amend its state Medicaid plan.
The bill makes two conforming amendments. It clarifies that
vaccines covered under the Vaccines for Children (VFC) program
are those recommended by the CDC Director, rather than an
advisory committee to the Director. It also strikes the current
law provision that terminates the VFC program in the event that
federal law provides for immunization services for all children
as part of a broad-based reform of the national health care
system.
Sec. 1712. Tobacco cessation
Current Law
State Medicaid programs may cover prescription drugs. If a
state Medicaid program elects to do so, as all currently do,
the state must cover prescription drugs approved by the Food
and Drug Administration (FDA). States may, however, exclude
certain classes of FDA-approved drugs from coverage altogether.
One of these excludable classes is agents when used to promote
smoking cessation.
Proposed Law
The bill would remove agents approved by the FDA for
purposes of promoting tobacco cessation from the list of
excludable drugs. Thus, state Medicaid programs that cover
prescription drugs would be required to cover these products,
when they are used to promote tobacco cessation. This
requirement would take effect with respect to drugs and
services furnished January 1, 2010.
Sec. 1713. Optional coverage of nurse home visitation services
Current Law
Nurse home visitation programs involve registered nurses
making home visits to low-income, first-time mothers, starting
during pregnancy and continuing through the child's second
birthday. The nurses work with the mothers on healthy behaviors
to improve pregnancy outcomes, parenting skills to improve
child health and development, and plans for the mother's life.
Visits are initially weekly, then monthly. There is strong
research evidence from rigorous random-assignment evaluations
that these programs improve the health of pregnant mothers,
reduce emergency room visits, reduce rates of child abuse and
neglect, and improve school achievement.
The Medicaid statute does not expressly recognize nurse
home visitation programs as an optional service. It does,
however, allow states to cover care coordination or case
management services that include some of the elements of
effective nurse home visitation programs. For example, states
may cover case management services that are targeted to
specific groups of beneficiaries, such as first-time pregnant
mothers, and that assist Medicaid-eligible women gain access to
needed medical, social, educational, and other services.
Effective nurse home visitation programs involve more than case
management, however.
Proposed Law
The bill would give states the option of covering nurse
home visitation services at the state's regular matching rate
beginning on January 1, 2010. The bill defines these services
as home visits by trained nurses to families with first-time
pregnant women or a child under age 2, either of whom is
eligible for Medicaid.
The content and frequency of the home visitation services
would be determined by the Secretary based upon evidence that
the services are effective in one or more of the following
areas: (1) improving maternal or child health and pregnancy
outcomes or increasing birth intervals between pregnancies; (2)
reducing the incidence of child abuse, neglect, and injury,
improving family stability (including reduction in the
incidence of intimate partner violence), or reducing maternal
and child involvement in the criminal justice system; and (3)
increasing economic self-sufficiency, employment advancement,
school-readiness, and educational achievement, or reducing
dependence on public assistance. The Secretary is not required
to implement this provision by regulation, but may instead
provide administrative guidance in the form of a letter to
state Medicaid Directors.
The bill clarifies that this new state option does not
alter any current authority in Medicaid or the Child Health
Insurance Program (CHIP) that enables states to use federal
matching funds, whether for services or administrative
activities, to help cover the cost of nurse home visitation
services for eligible women or children.
Sec. 1714. State eligibility option for family planning services
Current Law
States are required to extend Medicaid coverage to pregnant
women with family incomes up to 133% of the federal poverty
level ($14,400 for an individual in 2009). States have the
option of covering pregnant women with incomes above 133% FPL.
Coverage is limited to services related to pregnancy (including
prenatal, delivery, postpartum, and family planning services)
and to other conditions that may complicate pregnancy and
extends for 60 days post-partum. In most states, after the 60-
day post-partum period ends, the mother generally loses her
Medicaid eligibility because the income eligibility levels for
parents are lower than 133% of FPL (or higher in those states
that have raised their eligibility levels).
Under section 1115 of the Social Security Act, the
Secretary of HHS has the authority to grant waivers to states
to enable them to use federal Medicaid funds for populations
not otherwise eligible. As of 2009, the Secretary had granted
section 1115 waivers under section 1115 to 27 states to enable
them to extend coverage for family planning services and
supplies to low-income women who are not pregnant and are not
otherwise eligible for Medicaid. In some cases, the waivers
cover women who would otherwise lose coverage post-partum, in
other women who have not been previously eligible for Medicaid.
Many of these waivers have been successful in reducing the
incidence of unwanted births and improving the health of low-
income women. The Congressional Budget Office has estimated
that requiring states to cover family planning services for all
women between the ages of 15 and 44 with family incomes up to
200% of FPL would save the federal government $160 million over
10 years.
Proposed Law
The bill would give states the option of extending coverage
for family planning services and supplies to individuals who
are not pregnant and whose income does not exceed an income
eligibility level set by the state that is no higher than the
highest income eligibility level in the state for pregnant
women (either under the state's Medicaid or CHIP program). This
would enable state Medicaid programs to cover family planning
services and supplies for any individual who would be eligible
for Medicaid coverage of pregnancy-related care. In determining
income, the state could, at its option, consider only the
income of the applicant or beneficiary and disregard the income
of any family members. The state would not have authority to
impose a resource or assets test or to prohibit participation
of any otherwise eligible individual who has individual or
group health insurance coverage that does not cover family
planning services and supplies.
For purposes of this option, family planning services and
supplies would include medical diagnosis and treatment services
provided pursuant to a family planning services in a family
planning setting (including, at state option, testing and
treatment of sexually transmitted infections). As under current
law, the federal matching rate for the costs of family planning
services and supplies would be 90%. The federal matching rate
for the cost of the medical diagnosis and treatment services
provided pursuant to a family planning service would be the
state's regular FMAP. The new option would be effective on
enactment. The Secretary would not be required to issue
regulations to implement the provision.
The bill does not require states to discontinue their
current section 1115 family planning waivers, nor does it
prohibit the Secretary from renewing existing waivers or
granting new ones. The bill facilitates the conversion of
existing waivers into a state plan amendment under this new
option by allowing states to do so without modifying their
existing eligibility policies. Specifically, the bill gives a
state the ability to continue to use eligibility standards and
processes, including application procedures and practices, that
were operational under the state's waiver on or before January
1, 2007.
The bill would give states a related option of extending
coverage for family planning services and supplies to
presumptively eligible individuals for a limited period of time
during which the Medicaid application is being processed. The
purpose of this option is to avoid any delay in the provision
of services to women at risk of unwanted pregnancy. Under this
option, the state may designate qualified entities, including
family planning providers, to accept (and assist an individual
in filing) applications for coverage, and to make a
determination that an individual is presumptively eligible for
Medicaid under the new family planning option. The presumptive
eligibility period ends when the state Medicaid agency makes an
eligibility determination with respect to the applicant or (in
the case of an individual who does not file a timely
application) the end of the month following the month in which
the qualified entity made the determination of presumptive
eligibility, whichever comes first.
The bill clarifies that, in the case of a state that elects
the option to provide benchmark or benchmark-equivalent
coverage under section 1937 of the Social Security Act, the
coverage must include payment for family planning services and
supplies for all Medicaid beneficiaries of child-bearing age
who seek such services and supplies. This requirement applies
to states that currently offer benchmark or benchmark-
equivalent coverage under approved state plans as well as
states that elect to do so in the future.
Subtitle C--Access
Sec. 1721. Payments to primary care practitioners
Current Law
State Medicaid programs are required to cover physicians'
services, but they have flexibility in determining the amounts
that physicians will be paid for those services either on a
fee-for-service basis or in managed care organization networks.
Current law requires that state Medicaid plans provide methods
and procedures to assure that payments are consistent with
efficiency, economy, and quality of care and are sufficient to
enlist enough providers so that care and services are available
promptly and at least to the extent that such care and services
are available to the general population in the geographic area.
There is wide variation in Medicaid fee-for-service payment
rates for physicians' services from state to state. In 2008,
state payment rates for physicians' services averaged 72% of
Medicare's payment rates. In the case of primary care services
furnished by physicians, Medicaid payment rates averaged 66% of
Medicare rates, with one state as low as 36% and one as high as
140%. These low Medicaid payment rates do not provide adequate
incentives for physicians to participate in Medicaid, limiting
access to physicians' services by Medicaid beneficiaries. In
addition, low Medicaid payment rates discourage young
physicians and other health professionals from entering careers
in primary care, undermining efforts to address the shortage of
primary care practitioners in many areas of the country.
Proposed Law
The bill would require state Medicaid programs to pay for
primary care services furnished by physicians at a rate that is
not less than (1) 80% of the payment rate under Medicare's
physician fee schedule for services furnished in 2010, (2) 90%
of such rate for services furnished in 2011, and (3) 100% of
such rate for services furnished in 2012 and subsequent years.
States would continue to have the flexibility to pay for
primary care services (or other physicians' services) at rates
higher than Medicare.
The same minimum rate requirement would also apply to
services furnished by other health care professionals that
would be primary care services if furnished by a physician. In
such cases, the Medicare rate would be the rate applicable to
the health professional, not to the physician.
This minimum rate requirement would apply to payments for
primary care services furnished by any participating physician
or health professional, not just a primary care physician or
professional such as a pediatrician or nurse practitioner.
Thus, the requirement would apply to payments for primary care
services furnished to a Medicaid beneficiary by a specialist or
sub-specialist, but not to non-primary care services furnished
by that specialist or sub-specialist.
Primary care services would be defined as evaluation and
management services under section 1848(j)(5)(A)(i) of the
Social Security Act (as added by section 1121(d) of the bill).
These are services in the category designated Evaluation and
Management in the Health Care Common Procedure Coding System as
established and periodically modified by the Secretary of HHS.
This minimum rate requirement would apply whether a
physician or health professional is furnishing services to
Medicaid beneficiaries on a fee-for-service basis, as a primary
care case manager, or as a member of the network of a Medicaid
managed care organization (MCO). Medicaid MCOs would be
required to pay physicians and other health professionals
(whether in or out of network) for primary care services at
rates no lower than the minimum rates specified above. In the
case of MCOs that use compensation arrangements with network
physicians and health professionals that are not based on fee-
for-service, such as capitation or partial capitation, the
compensation would have to be at least the same as the
compensation the physician or health professional would receive
were payment to be made on a fee-for-service basis.
This minimum rate requirement is effective for primary care
services furnished on or after January 1, 2010. Initially, the
federal government will finance all of the cost attributable to
this new requirement. Specifically, for services furnished
through December 31, 2014, the federal government will pay 100%
of the increased cost. For services furnished after that date,
the federal government will pay 90% of the increased cost.
The cost attributable to this requirement is the amount by
which the minimum payment rate for a primary care service
exceeds the payment rate applicable to the service for the
physician or other health professional (as the case may be)
under a state's Medicaid program as in effect on June 16, 2009.
The following hypothetical example illustrates this policy.
Assume that the Medicare rate for a primary care office visit
for an established patient in 2012 in the state (or locality)
will be $70 and that the Medicaid payment in that state (or
locality) in 2009 for that visit was two thirds of the $60
Medicare rate in 2009, or $40. Also assume that the state's
regular federal matching rate is 50% in both years. The minimum
Medicaid rate the state is required to pay in 2012 is 100% of
the Medicare rate. Thus, the physician would receive $70 for
the office visit. Of this amount, the federal government would
pay $50 (50% of $40, or $20, plus 100% of the $30 difference
between the 2009 amount and the 2012 Medicare rate, or $30).
The state would pay $20--the same amount it would have paid had
its Medicaid rate remained unchanged at $40 per visit between
2009 and 2012.
If the state chose to pay the physician more for a service
than the Medicare rate, the state's regular federal matching
rate would apply to the costs attributable to amounts above the
Medicare rate. In the above example, if the state's rate in
2012 for the primary care visit was $80, the state would pay
half of the $10 increase above the Medicare rate of $70, and
the federal government the other half. In total, the federal
government would pay $55, and the state $25.
1722. Medical home pilot program
Current Law
There is no single definition of medical home. In the
context of Medicaid, the term has been used to refer to a model
of primary care in which teams of physicians and other health
professionals provide comprehensive and coordinated patient-
centered care for which they are adequately reimbursed. The
concept of a medical home is not recognized in the Medicaid
statute, and the federal government currently does not operate
national or regional medical home demonstrations or pilots
under Medicaid. The Medicaid Transformation Grants authorized
by section 1903(z) of the Social Security Act for FY 2007 and
FY 2008 were used by eight states to provide funding to develop
information technology infrastructure for medical home
programs. According to the National Academy of state Health
Policy, as of June 2009, 31 states were operating medical home
programs for one or more groups of Medicaid or CHIP
beneficiaries, often with state funding only.
Proposed Law
The bill would require the Secretary of Health and Human
Services to establish a 5-year medical home pilot program for
the Medicaid program. This program would parallel (and be
coordinated with) the Medicare medical home pilot authorized by
section 1302 of the bill. The program would provide care for
``high need'' Medicaid beneficiaries (including medically
fragile children and high-risk pregnant women). It would apply
one or more of the models under the Medicare medical home
pilot: the independent patient-centered medical home model
described in section 1866F(c) of the Social Security Act and
the community-based medical home model described in section
1866F(d)). The pilot could also include a test of other models
the Secretary approves.
The bill authorizes higher federal matching rates for the
administrative costs incurred by states in operating these
pilots, such as the costs of community care workers. The higher
rates could reach 90% for the first two years, then 75% of the
last three. Total additional federal funding for these
administrative expenditures could not exceed $1.235 billion
over the five year period of the program. States with pilot
programs approved by the Secretary would be eligible to receive
these higher administrative matching rates regardless of
whether they were operating a medical home program prior to the
establishment of this pilot program.
The bill authorizes the Secretary to waive the Medicaid
statutory requirements of statewideness and comparability in
order to facilitate these pilot programs. The bill does not
authorize the Secretary to waive any other Medicaid statutory
requirements, such as freedom of choice of provider.
In the case of a model involving medically fragile
children, the bill would require the Secretary to ensure that
the patient-centered medical home services received by each
child provide for continuous involvement and education of the
parent or caregiver and for assistance to the child in
obtaining necessary transitional care if a child's enrollment
ceases for any reason.
The bill directs the Secretary to conduct an evaluation of
the pilot program using the criteria specified for purposes of
the Medicare medical home pilot under section 1866F(e)(1) of
the Social Security Act and to report the findings to Congress
and the public.
Sec. 1723. Translation or interpretation services
Current Law
Section 201(b)(2)(A) of the Children's Health Insurance
Program Reauthorization Act of 2009 (CHIPRA, P.L. 111-3)
established a 75% federal matching rate for the cost to state
Medicaid programs of providing language translation or
interpretation services in connection with the enrollment and
retention of, and use of services by, children of families for
whom English is not the primary language.
Proposed Law
The bill would extend the 75% federal matching rate for the
cost of providing language translation or interpretation
services to all individuals for whom English is not the primary
language. Allowable costs would include those found necessary
by the Secretary for services to facilitate the enrollment and
retention of individuals eligible for Medicaid as well as for
services to promote access to covered health and long-term care
services and to address language barriers to the appropriate
delivery of those services. The provision would take effect
January 1, 2010; the Secretary would not be required to issue
implementing regulations.
Sec. 1724. Optional coverage for freestanding birth center services
Current Law
Medicaid pays for more than one in three births in the
United States. One option other than a hospital birth or a
homebirth is a freestanding birth center. State Medicaid
programs have the option of covering clinic services furnished
by or under the direction of a physician and receiving federal
matching funds for those costs. However, there is no provision
in the Medicaid statute that authorizes federal Medicaid
matching funds for direct payments to freestanding birth
centers not operated by a physician for providing services to
eligible pregnant women.
Proposed Law
The bill would give state Medicaid programs the option of
covering freestanding birth center services and other
ambulatory services offered by a freestanding birth center that
are otherwise covered under the state Medicaid plan at the
state's regular federal matching rate. Freestanding birth
center services are defined as services furnished to an
individual at a freestanding birth center, including services
furnished by a licensed birth attendant at the center. A
freestanding birth center is defined as a health facility that
is not a hospital and where childbirth is planned to occur away
from the pregnant woman's residence. A licensed birth attendant
is defined as an individual who is licensed or registered by
the state to provide health care at childbirth and who provides
such care which the individual is legally authorized to perform
under state law (or state regulatory mechanism provided by
state law), regardless of whether the individual is under the
supervision of, or associated with, a physician or other health
care provider. This provision would apply to items and services
furnished on or after the date of enactment; the Secretary
would not be required to issue regulations to implement this
option.
Sec. 1725. Inclusion of public health clinics under the vaccines for
children program
Current Law
Under the Vaccines for Children (VFC) program, Medicaid
pays the costs of recommended vaccinations for certain low-
income children. Children who are eligible for vaccines under
the program--``federally vaccine-eligible children''--include
children who receive vaccines purchased through the program and
administered at a federally qualified health center (FQHC) or
rural health clinic (RHC) and are not insured with respect to
vaccines.
Proposed Law
The bill would expand the definition of federally-vaccine
eligible children to include children who are not insured with
respect to a recommended vaccine and are administered the
vaccine at a public health clinic. The purpose of this change
is to improve access by low-income children to recommended
vaccines by expanding the locations at which recommended
vaccines can be administered to include health clinics operated
by state or local health departments or hospitals. The
provision is effective on enactment; the Secretary would not be
required to issue regulations in order to implement this
change.
Sec. 1726. Requiring coverage of services of podiatrists
Current Law
State Medicaid programs are required to cover physicians'
services furnished by a physician as the term ``physician''
defined in section 1861(r)(1) of the Social Security Act (i.e.,
a doctor of medicine or osteopathy). The Medicare definition of
physician at section 1861(r)(3) includes a doctor of podiatric
medicine, but this does not apply to the Medicaid coverage
requirement. State Medicaid programs may, however, cover
podiatry services at their option.
Proposed Law
The bill would require state Medicaid programs to cover
physicians' services furnished by a doctor of podiatric
medicine with respect to functions he or she is legally
authorized to perform under state law. This requirement would
apply to services furnished on or after January 1, 2010, unless
the Secretary determines that state legislation (other than for
appropriations) is needed in order for the state Medicaid plan
to meet the additional requirements of this section. In this
case the requirement would apply the first day of the first
calendar quarter after the close of the first regular session
of the state legislature after enactment.
Sec. 1726A. Requiring coverage of services of optometrists
Current Law
State Medicaid programs have the option of covering
services furnished by optometrists within their scope of
practice under state law. States may also cover eyeglasses
prescribed by an optometrist.
Proposed Law
The bill would require state Medicaid programs to cover
medical and other health services authorized by state law to be
furnished by optometrists to the extent that the services may
legally be furnished by an optometrist under state law. An
optometrist is defined as a doctor of optometry. This
requirement would apply to services furnished, or other actions
required, on or after 90 days after enactment, unless the
Secretary determines that state legislation (other than for
appropriations) is needed in order for the State Medicaid plan
to meet the additional requirements of this section. In this
case the requirement would apply the first day of the first
calendar quarter after the close of the first regular session
of the state legislature after enactment.
Sec. 1727. Therapeutic foster care
Current Law
In general, therapeutic foster care programs place children
and adolescents who have serious emotional and behavioral
problems with specially trained foster families. Some State
Medicaid programs have elected to cover therapeutic foster care
under the optional rehabilitative services benefit.
In August 2007, the Centers for Medicare & Medicaid
Services published a proposed rule amending the definition of
rehabilitative services to exclude therapeutic foster care
services furnished by foster care providers to children, except
for medically necessary rehabilitation services that are
clearly distinct from packaged therapeutic foster care
services, 72 Federal Register at 45212 (August 13, 2007). The
Congress imposed a series of moratoria on the implementation of
this proposed rule through April 1, 2009. Section 5003(d)(3) of
the American Recovery and Reinvestment Act of 2009 (P.L. 111-5)
states a Sense of the Congress that the Secretary should not
promulgate the August 13, 2007 proposed rule as a final rule.
Proposed Law
The bill would clarify that nothing in the federal Medicaid
statute prevents or limits a state Medicaid program from
covering therapeutic foster care for eligible children in out-
of-home placements under the rehabilitative services option.
Therapeutic foster care is defined as a foster care program
that provides certain services to eligible children and to
foster parents. For children, those services are: (1)
structured daily activities that develop, improve, monitor, and
reinforce age-appropriate social, communications, and
behavioral skills; (2) crisis intervention and crisis support
services; (3) medication monitoring; (4) counseling; and (5)
case management services. For foster parents, those services
are specialized training and consultation on the management of
children with mental illnesses and related health and
developmental problems.
Sec. 1728. Assuring adequate payment levels for services
Current Law
In general, state Medicaid programs have flexibility to
determine the rates they pay to providers for furnishing
covered services to eligible individuals. This flexibility is
bounded by federal statutory requirements. One of these is
sometimes referred to as the ``equal access'' requirement.
Specifically, state Medicaid programs must provide methods and
procedures relating to payment for care and services as may be
necessary to assure that payments are sufficient to enlist
enough providers so that care and services are promptly
available to Medicaid beneficiaries at least to the extent that
such care and services are available to the general population
in the geographic area. The Committee heard testimony that
beneficiary access to covered services has in some states been
compromised by limited provider participation due to low
Medicaid payment rates.
Proposed Law
The bill would establish a procedure for monitoring and
enforcing compliance with this equal access requirement. Each
state would be required to submit to CMS a state Medicaid plan
amendment that specifies the payment rates the state intends to
use to pay providers (including facilities and practitioners)
and managed care organizations for the services it covers in
the coming year, along with data that will enable the Secretary
to evaluate the state's compliance with the equal access
requirement. Such additional data would include how payments to
Medicaid managed care organizations take into account payment
rates to providers under the state Medicaid plan.
The state plan amendment would be due by April 1 prior to
the year to which the payment rates apply. The Secretary would
be required to review the state plan amendment within 90 days
of submission and approve or disapprove it. If the Secretary
disapproves the amendment, the state would be required to
submit immediately a revised amendment that brings it into
compliance with the requirement. The provision is effective on
enactment; the first year to which this requirement applies
would be 2011.
Sec. 1729. Preserving Medicaid coverage for youths upon release from
public institutions
Current Law
In general, federal Medicaid matching funds are not
available for services delivered to individuals who are
otherwise eligible for Medicaid but who are living in a public
institution--that is, an institution that is the responsibility
of a governmental unit or over which a governmental unit
exercises administrative control. This includes juvenile
correctional or residential facilities operated by states or
localities but not medical facilities that are not linked to a
public institution. Federal law does not require states to
terminate Medicaid eligibility when an individual becomes an
inmate in a public institution, but research indicates that
many states do so. In such cases, the individual must reapply
for Medicaid upon release from the institution, a process that
may take several months, during which time the individual
typically does not have a source of payment for needed medical
or behavioral treatment.
Proposed Law
The bill would impose three requirements on state Medicaid
programs with respect to youths who are age 18 or younger and
enrolled in Medicaid at the time of being incarcerated in a
public institution and who are age 18 or younger and eligible
for Medicaid at the time of being released from the
institution. First, the state Medicaid program is prohibited
from terminating the youth's Medicaid eligibility during the
period of incarceration. Second, during the period the youth is
incarcerated, the state must ensure that the youth receives
Medicaid services for which federal matching funds are
available (the state may not claim federal matching funds for
care or services that are excluded from coverage). Third, on or
before the date the youth is released, the state shall ensure
that the youth is enrolled in Medicaid so that the youth can
access Medicaid-covered services immediately upon leaving the
institution. The youth would remain enrolled in Medicaid until
the state determines that he or she is no longer eligible. The
provision is effective on enactment.
Sec. 1730. Quality measures for maternity and adult health services
under Medicaid and CHIP
Current Law
Section 401 of the Children's Health Insurance Program
Reauthorization Act of 2009 (CHIPRA, P.L. 111-3) directs the
Secretary of HHS to develop (1) an initial core set of health
care quality child health quality measures for children
enrolled in Medicaid or CHIP, (2) a standardized format for
reporting information, and (3) procedures to encourage states
to use the initial core measurement set to voluntarily report
information on the quality of pediatric care in these two
programs. There is no comparable requirement with respect to
maternity care or services to adults purchased by Medicaid.
Section 1442 of the bill would add a new section 1192 to
the Social Security Act that directs the Secretary of HHS to
enter into agreements with qualified entities to develop
quality measures for the delivery of health care services in
the U.S.
Section 1443 of the bill would add a new section 1808(d) to
the Social Security Act that sets forth a process for multi-
stakeholder pre-rulemaking input into the selection of quality
measures.
Proposed Law
The bill would require the Secretary of HHS to develop and
publish for comment no later than January 1, 2011, a proposed
set of measures on the quality of maternity care provided under
both Medicaid and CHIP. The bill would require that the final
recommended set of maternity care quality measures be published
no later than July 1, 2011. No later than January 1, 2012, the
Secretary would be required to develop and publish a
standardized reporting format for maternity care quality
measures for use by state Medicaid and CHIP programs to collect
data from participating managed care entities, providers, and
practitioners, and to report such measures to the Secretary.
The bill would require the Secretary to develop quality
measures that are not otherwise developed under the section
1192 program established by section 1442 of the bill for
services purchased by state Medicaid programs for non-elderly
adults (individuals between the ages of 21 and 64). The
Secretary would be required to publish such quality measures
through notice and comment rulemaking. The Secretary would also
be required to develop and publish a standardized reporting
format for these quality measures (and for those developed
under section 1192) for services purchased by state Medicaid
programs for non-elderly adults. The reporting format must
enable state administering agencies to collect data from
participating managed care entities, providers and
practitioners, and to report such measures to the Secretary.
The bill sets forth certain requirements with respect to
the development of these quality measures and reporting
formats. The Secretary would be authorized (but not required)
to enter into agreements (by contract, grant or otherwise) with
public, non-profit or academic institutions with technical
expertise in health quality measurement to assist in the
development of these measures and reporting formats. The
Secretary would be required to obtain the input of stakeholders
with respect to such quality measures using a process similar
to that described in new section 1808(d) of the Social Security
Act as added by section 1143 of the bill. Finally, the bill
directs the Secretary to coordinate the development of these
maternity and adult care quality measures with the development
of child health quality measures.
To enable the Secretary to carry out these requirements,
the bill appropriates a total of $40 million for the five-year
period beginning in FY 2010. These funds would remain available
until expended.
The bill directs the Secretary to report annually to the
Committee on Energy and Commerce and the Senate Finance
Committee regarding (1) the availability of reliable data
relating to quality of maternity care provided under the
Medicaid and CHIP programs, (2) the availability of reliable
data relating to quality of services provided under Medicaid
and CHIP programs to adults ages 21 to 64, and (3)
recommendations for improving the quality of such care and
services furnished under Medicaid and CHIP. The first report
would be due January 1, 2013.
The bill provides that no quality measure developed,
published or used as a basis of measurement or reporting under
this section may be used to establish an irrefutable
presumption regarding either the medical necessity of care or
the maximum permissible coverage for an individual who is
receives services under Medicaid or CHIP.
Sec. 1730A. Accountable care organization pilot program
Current Law
Section 1301 of the bill would establish an accountable
care organization (ACO) pilot program to test different payment
incentive models to reduce the growth of expenditures and
improve health outcomes for Medicare beneficiaries. These
models are intended to promote accountability for a patient
population, to encourage investment in infrastructure and
redesigned care processes, and to reward physicians for the
provision of high quality services and for efficient service
delivery. The models to be tested are the performance target
model, the partial capitation model, and other payment models
developed by the Secretary. There is no provision in current
Medicaid law for an ACO pilot program.
Proposed Law
The bill would require the Secretary of HHS to establish a
5-year ACO pilot program under Medicaid that applies one or
more of the payment incentive models tested under the Medicare
ACO pilot program established under section 1301 of the bill.
States could apply for approval of an ACO Medicaid pilot
program. To facilitate these pilot programs, the Secretary
would be authorized to waive Medicaid requirements relating to
statewideness and to comparability requirements. (The Secretary
would not have authority to waive other federal Medicaid
requirements). The Secretary would also be authorized to
increase the matching percentages for administrative costs
incurred by a state in connection the an ACO pilot program from
the regular 50% matching rate up to 90% for the first two years
and up to 75% for the next three years.
The Secretary would be required to evaluate the impact of
the Medicaid ACO pilot program on beneficiaries, providers, and
the Medicaid program itself using the same criteria she uses to
evaluate the Medicare ACO pilot program under section 1301 of
the bill. The Secretary would be required to submit a report on
her findings to the Congress within 60 days after completion of
the evaluation and to make her findings available to the
public.
Subtitle D--Coverage
Sec. 1731. Optional Medicaid coverage of low-income HIV-infected
individuals
Current Law
With some exceptions, the federal Medicaid statute requires
state Medicaid programs to cover certain persons with
disabilities and certain persons age 65 and over who meet the
income and resources criteria under the Supplemental Security
Income (SSI) program. In 2009, the income threshold for the
SSI-related Medicaid eligibility group is $674 per month for an
individual and $1,011 per month for a couple, and the resources
threshold is $2,000 for an individual and $3,000 for a couple.
States are also required to continue Medicaid coverage for
certain working disabled individuals under age 65 who were
eligible for SSI and but for their earnings would continue to
be eligible for SSI. States have the option to allow applicants
with higher amounts of countable income and assets qualify for
Medicaid.
Low-income individuals with HIV infection do not meet the
SSI standard for disability unless their HIV infection has
progressed to full AIDS. However, individuals with HIV
infection may be found to be presumptively disabled if they are
able to document one or more of a specified listing of
opportunistic infections, cancers, or conditions. Individuals
who do not have one of the listed conditions will be unable to
qualify for Medicaid unless they are able to qualify through
another category--for example, they are a child under 19 or a
parent with a dependent child or an individual 65 or over. If
low-income people with HIV were eligible, Medicaid, which
generally covers physician and diagnostic services and
prescription drugs, could help them forestall the progressive
collapse of their immune system, contracting these conditions,
or progressing to full AIDS.
The federal government's share of the costs of most
Medicaid services is determined by the federal medical
assistance percentage (FMAP), which varies by state and ranges
from at least 50% to no more than 83%. A state's share of
program expenditures is equal to 100% minus its FMAP. States
that elect to cover Medicaid services for uninsured women
diagnosed with breast and/or cervical cancer receive an
enhanced FMAP for the costs of such benefits in which a state's
share of expenditures is 30% lower than under the regular FMAP
(e.g., a state with a 50% regular FMAP would receive a 65%
federal match).
For the 50 states and the District of Columbia there are no
limits on federal matching payments for allowable costs
incurred in operating their Medicaid programs. Medicaid
programs in the five territories (American Samoa, Guam, the
Northern Mariana Islands, Puerto Rico, and the Virgin Islands)
are subject to annual ceilings on federal Medicaid matching
funds.
Proposed Law
The bill would allow states (including the territories) to
extend Medicaid coverage to individuals who have HIV infection
with income and resources levels that do not exceed the maximum
income and resource levels allowed for the state's SSI-related
Medicaid eligibility groups. These individuals would not have
to establish presumptive disability or disability for SSI
purposes. The federal government's share of expenditures for
this new eligibility group would be determined by the enhanced
FMAP applicable to the costs of treatment for uninsured women
diagnosed with breast and/or cervical cancer. The expenditures
incurred by the territories in covering this eligibility group
would be matched at the enhanced FMAP without regard to their
federal Medicaid spending ceilings.
The provision would apply to calendar quarters beginning on
or after the date of enactment without regard to whether or not
final regulations to carry out such amendments have been
promulgated by such date. Federal Medicaid matching funds would
not be available for items or services furnished to such
individuals on or after January 1, 2013, the date on which
state Medicaid programs will be required to cover all
individuals with incomes at or below 133% of the federal
poverty level and the Health Insurance Exchange established by
the bill would take effect. At that point, depending on their
incomes, low-income individuals with HIV would be able to
obtain coverage for physician and diagnostic services and
prescription drugs either through Medicaid or through the
Exchange (with financial assistance for the cost of premiums in
the case of those with incomes below 400% of the federal
poverty level).
Sec. 1732. Extending transitional Medicaid Assistance (TMA)
Current Law
States are required to continue Medicaid coverage for
certain low-income families who would otherwise lose coverage
because of increases in the numbers of hours worked or because
of increases in earned income. The period of continuation
extends up to 12 months so long as the family's gross monthly
earnings (less child care costs) do not exceed 185% of the
federal poverty level. The purpose of this transitional medical
assistance (TMA) requirement is to promote the transition of
low-income families from cash assistance to self-sufficiency by
reducing the work disincentive that results from the loss of
Medicaid coverage when the employer does not offer health
insurance coverage, or offers coverage that the family cannot
afford. This requirement expires on December 31, 2010.
Proposed Law
The bill extends the TMA requirement through December 31,
2012. Under this extension, families who would otherwise lose
Medicaid coverage due to increased hours or work or earnings on
or before that day will be entitled to up to one year of
continuation Medicaid coverage. This will protect the work
incentives resulting from the TMA requirement while the bill's
coverage expansions are implemented. (On January 1, 2013,
states will be required to offer Medicaid coverage to all
working families with incomes at or below 133% of FPL, and the
Health Insurance Exchange will offer coverage for working
families with incomes above that level (along with assistance
in purchasing coverage for those with incomes below 400% of
FPL)).
Sec. 1733. Requirement of 12-month continuous coverage under certain
CHIP programs
Current Law
Under the Children's Health Insurance Program (CHIP),
states have three administrative options. They may enroll CHIP-
eligible low-income children in their Medicaid programs, create
a stand-alone CHIP program that is separate from Medicaid, or
use a combination of both approaches.
Regardless of administrative structure, states are required
to redetermine eligibility of children enrolled in CHIP at
least every 12 months. Section 104 of the Children's Health
Insurance Program Reauthorization Act of 2009 (CHIPRA, P.L.
111-3) establishes a program of performance bonus payments to
states that adopt 4 of a list of 7 enrollment and retention
provisions. One such provision is continuous eligibility for a
full 12 months for all children under both the state's Medicaid
and CHIP programs. This allows a child, once determined
eligible, to remain eligible for a full 12-month period,
regardless of any intervening change in family income.
Proposed Law
The bill would require separate CHIP programs (including
such programs in states that use a combination Medicaid and
separate CHIP approach) to implement 12 months of continuous
eligibility for eligible children with family incomes below
200% of the federal poverty line. This provision would apply to
eligibility determinations and to redeterminations made on or
after January 1, 2010, and would not require the issuance of a
regulation by the Secretary in order to take effect.
Sec. 1734. Preventing the application under CHIP of coverage waiting
periods for certain children
Current Law
State CHIP programs are required to have procedures to
ensure that the coverage provided under the state CHIP program
does not substitute for coverage under group health plans. One
anti-substitution procedure that some state CHIP programs use
is to impose a waiting period on an otherwise eligible child
applying for CHIP coverage. The waiting period runs for a
specified number of months after the loss of coverage under a
group health plan. During this period, the child, although
eligible for CHIP coverage, is uninsured.
Proposed Law
The bill would prohibit state CHIP programs from applying a
waiting period to delay the enrollment of any of the following
children: (1) infants and toddlers under two years of age; (2)
children who have lost health insurance coverage under a group
health plan or health insurance coverage offered through an
employer due to (a) termination of employment, (b) a reduction
in work hours, (c) elimination of an individual's retiree
health benefits, or (d) termination of an individual's health
insurance coverage offered through an employer; or (3) children
in families that demonstrate that the cost of health insurance
coverage (including the cost of premiums, co-payments,
deductibles, and other cost sharing) exceeds 10% of the
family's income. (Family income would be determined in the same
manner as the state determines family income for purposes of
eligibility determinations under its CHIP program). This
prohibition would take effect 90 days after enactment. The
Secretary would not be required to issue regulations to
implement this prohibition.
Sec. 1735. Adult day health care services
Current Law
Adult day health care (ADHC) services are a type of long-
term care service for elderly or disabled individuals who have
chronic health conditions or cognitive impairments that require
regular monitoring or treatment. ADHC services provide nursing,
physical and occupational and speech therapy, personal care,
dietary and meal, activities, and transportation services
designed to enable the frail elderly and individuals with
disabilities to remain in the community and delay entry into a
nursing facility.
State Medicaid programs may cover ADHC services under a
section 1915(c) home- and community-based waiver for
individuals who require the level of care available in a
nursing facility. The Medicaid statute does not expressly
recognize ADHC services as a service that states may cover at
their option without obtaining a section 1915(c) waiver.
However, prior to 1994, the federal government had approved
state plan amendments authorizing 8 state Medicaid programs to
cover ADHC services, in some cases under the statutory option
to cover rehabilitative services.
In August 2007, the Centers for Medicare & Medicaid
Services published a proposed rule amending the definition of
the optional rehabilitative services benefit, 72 Federal
Register at 45201 (Aug. 13, 2007). One effect of this proposed
rule would have been to disallow federal Medicaid matching
payments for coverage of ADHC services under the rehabilitative
services option. Congress imposed a series of moratoria on the
implementation of this proposed rule through April 1, 2009.
Section 5003(d)(3) of the American Recovery and Reinvestment
Act of 2009 (P.L. 111-5) states a ``Sense of the Congress''
that the Secretary should not promulgate the August 13, 2007,
proposed rule as a final rule.
Proposed Law
The bill would prohibit the Secretary from withholding,
suspending, disallowing, or otherwise denying federal Medicaid
matching payments for the costs of adult day health care
services, day activity and health services, or adult medical
day care services, as defined under a state Medicaid plan
approved during or before 1994, if these services are provided
consistent with the definition in the approved state plan and
the requirements of the plan. The bill would also prohibit the
Secretary from withdrawing (by regulation or otherwise) federal
approval of all or part of any such state Medicaid plan
relating to the provision of ADHC services. This provision
would apply to services provided on or after October 1, 2008.
Sec. 1736. Medicaid coverage for citizens of freely associated states
Current Law
The Personal Responsibility and Work Opportunity
Reconciliation Act of 1996 (PRWORA, P.L. 104-193) prohibits
noncitizens who are not considered to be ``qualified aliens''
(e.g., legal permanent residents, asylees, refugees) from
receiving Medicaid benefits (other than for treatment of an
emergency medical condition). Citizens of the Freely Associated
States (i.e., citizens of the Republic of the Marshall Islands
(RMI), the Federated States of Micronesia (FSM), and the
Republic of Palau) are not included in the PRWORA definition of
``qualified alien'' under PRWORA and are therefore barred from
receiving non-emergency Medicaid.
PRWORA also bars ``qualified aliens'' arriving in the
United States on or after August 22, 1996, from Medicaid
coverage for the first five years after entry (other than for
treatment of an emergency medical condition). After an
individual's 5-year waiting period has run, states have the
option of extending Medicaid coverage to the individual if he
or she is otherwise eligible. Section 214 of the Children's
Health Insurance Reauthorization Act of 2009 (CHIPRA, P. L.
111-3) allows states to provide Medicaid and CHIP coverage to
legal immigrant children and pregnant women notwithstanding
this 5-year bar.
Proposed Law
The bill would nullify the PRWORA rules with respect to
Medicaid coverage of individuals who lawfully reside in the
United States (including territories and possessions of the
United States) in accordance with the Compacts of Free
Association between the Governments of the Federated States of
Micronesia, the Republic of the Marshall Islands, and the
Republic of Palau. These individuals would be defined as
``qualified aliens'' for purposes of receiving Medicaid
benefits. They would not be subject to the 5-year bar, and
states would not have discretion to deny Medicaid coverage on
the grounds that these individuals are ``qualified aliens.'' If
these individuals otherwise meet the eligibility requirements
for Medicaid in the state (or territory or possession) in which
they reside, they would be entitled to Medicaid benefits.
Sec. 1737. Continuing requirement of Medicaid coverage of non-emergency
transportation to medically necessary services
Current Law
Federal Medicaid regulations (42 CFR 431.53) require state
Medicaid agencies to ensure necessary transportation for
beneficiaries to and from providers, and to describe the
methods that the agency will use to meet this requirement. The
purpose of this requirement is to ensure access to covered
services by low-income beneficiaries, including those in rural
areas, who live far from their providers and have no personal
means of transportation, as well by those beneficiaries with
disabilities who require specialized transportation to access
their treating providers.
In December 2007, the Centers for Medicare & Medicaid
Services (CMS) issued a final rule (72 Federal Register 73635,
Dec. 28, 2007) that, among other things, modified 42 CFR 431.53
to exclude from necessary transportation the transportation of
school-age children between home and school. The Congress
imposed a series of moratoria on the implementation of this
rule through July 1, 2009. Just prior to this date, CMS
rescinded the 2007 final rule on school-based administration
and transportation (see 74 Federal Register 31183, June 30,
2009) and revised 42 CFR 431.53 to delete the exclusion for
transportation of school-aged children between home and school.
Proposed Law
The bill would codify non-emergency transportation to
medically necessary services, consistent with the requirement
of 42 CFR 431.53 as in effect as of June 1, 2008, as a
mandatory Medicaid benefit. (On June 1, 2008, the congressional
moratorium on the December 2007 final rule was in effect,
nullifying the changes that rule attempted to make in 42 CFR
431.53; thus the requirement that is being codified is the one
in place before the December 2007 rule was issued.). The
provision would apply to non-emergency transportation to
medically necessary services provided on or after enactment.
Sec. 1738. State option to disregard certain income in providing
continued Medicaid Coverage for certain individuals with
extremely high prescription costs
Current Law
State Medicaid programs have the option of extending
coverage to ``medically needy'' individuals. These are aged or
disabled individuals, or children and parents, whose countable
assets are below the state's medically needy resource
eligibility threshold and who incur high medical expenses
which, when subtracted from their income, reduce that income to
an amount below the State's medically needy income eligibility
threshold.
There is no authority in current law for state Medicaid
programs that do not cover the medically needy to offer
coverage to individuals with rare diseases or conditions who
incur extremely high prescription drug expenses due to the high
cost of the orphan drugs (as designated under section 526 of
the Food, Drug, and Cosmetic Act (21 U.S.C. 360bb)).
Proposed Law
The bill gives state Medicaid programs the option of
covering certain individuals with extremely high prescription
drug costs attributable to an orphan drug by disregarding a
specified amount of family income when redetermining Medicaid
eligibility. Individuals eligible under this option would have
to (1) have extremely high prescription drug costs and (2) be
determined otherwise eligible for Medicaid but for family
income. A state electing this option would be required to
impose nominal cost-sharing on the drugs purchased by the
individual and could, at its option, impose additional cost-
sharing up to a maximum level specified by the Secretary. The
state would be required to consider an individual's
reapplication for Medicaid under this option within 30 days of
the filing of the application.
An individual would be considered to have extremely high
prescription drug costs for a 12-month period if he or she: (1)
is covered through an individual or group health insurance
policy that has a maximum lifetime limit of at least $1
million, including prescription drug coverage; (2) has
exhausted all available prescription drug coverage under the
policy prior to the beginning of the 12-month period; (3)
incurs (or is reasonably expected to incur) during the 12-month
period costs for orphan drugs in excess of $200,000 (adjusted
annually by the rate of medical inflation after 2010); and (4)
has an annual family income at the beginning of the period of
no more than 75% of the costs the individual incurs for orphan
drugs in excess of $200,000, as adjusted.
The amount of family income that a state could disregard
under this option could not exceed the greater of (1) $200,000
(adjusted annually by the rate of medical inflation after 2010)
or (2) the cost of orphan drugs incurred (or reasonably
expected to be incurred) during the 12-month period. The
provision would take effect on enactment.
Subtitle E--Financing
Sec. 1741. Payments to pharmacists
Current Law
Medicaid law requires the Secretary of HHS to establish
upper limits on the amounts that state Medicaid programs may
pay pharmacists for multiple source (generic) drugs and receive
federal matching payments for the costs of such drugs. These
are known as federal upper limits, or FULs, and they apply to
aggregate state expenditures for each drug. Prior to January 1,
2007, the FUL limit was set at 150% of the lowest published
price (i.e., wholesale acquisition cost, average wholesale
price or direct price) for each dosage and strength of the
generic drug products.
The Deficit Reduction Act of 2005 (DRA; P.L. 109-171)
established a new limit for FULs, effective January 1, 2007,
equal to 250% of the average manufacturer price (AMP) of the
least costly therapeutic equivalent (excluding prompt-pay
discounts to wholesalers). AMP is the average price paid to the
manufacturer by wholesalers for drugs distributed to the retail
pharmacy class of trade. Manufacturers, as a condition of
Medicaid purchasing their products, must report AMP data to the
Centers for Medicare & Medicaid Services (CMS).
Section 203 of Medicare Improvements for Patients and
Providers Act of 2008 (MIPPA, P.L. 110-275) imposed a
moratorium on the implementation of the DRA change in FUL
limits until October 1, 2009. In the interim, FULs are set
based on the pre-DRA methodology of 150% of the lowest
published price.
Proposed Law
The bill would direct the Secretary to calculate FULs as
130% of the weighted average (determined on the basis of
manufacturer utilization of multiple source drugs) of monthly
average manufacturer prices (AMPs). FULs specified under this
new formula would apply beginning January 1, 2011. The FULs
specified under 42 CFR 447.332 as in effect on December 31,
2006, would continue to apply through December 31, 2010.
The bill revises the definition of AMP in the Medicaid
statute, both for purposes of calculating FULs and for
determining Medicaid rebate amounts. In determining the AMP,
the Secretary would be required to exclude the following: (1)
customary prompt-pay discounts extended to wholesalers; (2)
bona fide service fees paid by manufacturers; (3) reimbursement
by manufacturers for recalled, damaged, expired, or otherwise
unsalable returned goods, including reimbursement for cost of
the goods and reimbursement for the costs associated with
return goods handling and processing, reverse logistics, and
drug destruction; (4) sales directly to, or rebates, discounts,
or other price concessions provided to, pharmacy benefit
managers (PBMs), managed care organizations (MCOs), health
maintenance organizations, insurers, mail-order pharmacies
(such as those operated by PBMs) that are not open to all
members of the public, or long-term care providers, so long as
these discounts, rebates, and price concessions are not passed
through to retail pharmacies; (5) sales directly to, or
rebates, discounts, or other price concessions provided to,
hospitals, clinics, and physicians, unless the drug is an
inhalation, infusion, or injectable drug, or the Secretary
determines under HHS administrative procedures that it is
necessary to include these sales, rebates, discounts, and price
concessions in order to calculate an accurate AMP for the drug;
and (6) rebates, discounts, and other price concessions
required under subsections (f) and (g) of section 1860D-2(f) of
the Social Security Act (as added by section 1181(b) of the
bill). A determination by the Secretary that it is necessary to
include certain sales or price concessions to hospitals,
clinics, and physicians in order to obtain an accurate AMP for
a drug would not be subject to judicial review.
The bill requires manufacturers that have entered into
Medicaid drug rebate agreements with the Secretary to report
within 30 days after the last day of each month of a rebate
period, the manufacturer's total number of units used to
calculate the monthly AMP for each covered drug. The bill
clarifies that manufacturers are required to submit specified
AMP pricing information to the Secretary within 30 days of the
end of each month of a rebate period, rather than within 30
days of the end of a rebate period.
The bill authorizes the Secretary to promulgate in an
expedited manner regulations setting forth the requirements for
FULs and for the determination of AMPs. These regulations could
be effective on an interim final basis pending opportunity for
public comment.
The bill would eliminate the current law requirement that
the Secretary post on a website accessible to the public, and
update on a quarterly basis, the most recently reported AMPs
for single source drugs and for multiple source drugs.
Sec. 1742. Prescription drug rebates
Current Law
Medicaid law requires prescription drug manufacturers that
seek to sell any of their products to State Medicaid programs
to enter into a rebate agreement with the Secretary of HHS.
Under these agreements, manufacturers must provide state
Medicaid programs with rebates for the drugs purchased for
Medicaid beneficiaries on an outpatient basis, and state
Medicaid programs must cover all drugs (except certain
statutorily excluded drug classes) marketed by those
manufacturers. The rebates are shared by the state and federal
governments in proportion to their respective shares of
Medicaid drug expenditures. Certain drugs are not subject to
rebates, including drugs dispensed by Medicaid managed care
organizations, drugs used on an inpatient basis, and drugs
dispensed in physicians' or dentists' offices.
In the case of brand-name prescription drugs, a
manufacturer's rebate obligation is the sum of two components--
the basic rebate and an additional rebate. The basic rebate is
the greater of (1) 15.1% of the average manufacturer price
(AMP) or (2) the difference between AMP and the best price. The
AMP is the average price that a manufacturer receives for sales
in the United States to wholesalers for drugs distributed to
the retail pharmacy class of trade. The ``best price'' is the
lowest price available from the manufacturer to any wholesaler,
retailer, provider, health maintenance organization, or
nonprofit or governmental entity, subject to certain
exceptions. The additional rebate is the amount by which a
drug's AMP exceeds the drug's base period AMP increased by the
consumer price index.
Currently, modifications to existing drugs--new dosages or
formulations, such as extended release versions, sometimes
referred to as product line extensions--generally are
considered new products for purposes of reporting AMPs to the
Secretary. As a result, manufacturers can avoid incurring
additional rebate obligations by making slight alterations to
existing products. When new products are released,
manufacturers can set their base period AMP to any price, so
they are able to set new higher prices that will not incur
Medicaid's additional rebates.
Proposed Law
The bill would increase the minimum rebate percentage for
single source and innovator multiple source drugs from 15.1% to
22.1%. This increase would be effective for rebate periods
beginning after December 31, 2009.
The bill would apply a rebate to new formulations of
existing single source or innovator multiple source drugs.
Under this provision, the rebate for a line extension of a
single source or innovator multiple source prescription drug
that is an oral solid dosage form would be the greater of (1)
the rebate as calculated under current law (e.g., basic rebate
plus additional rebate) or (2) a line extension rebate
calculation. The line extension rebate amount would be product
of: (1) the AMP for the line extension that is an oral solid
dosage form; (2) the highest additional rebate (calculated as a
percentage of AMP) for any strength of the original single
source or innovator multiple source drug; and (3) the total
number of units of each dosage form and strength of the line
extension product paid for by the state Medicaid program during
the rebate period (as reported by a state). For this purpose,
the term ``line extension'' means an extended release
formulation of the drug. This provision would be effective for
new formulations dispensed to Medicaid beneficiaries after
December 31, 2009, regardless of when the new formulations came
to market.
Sec. 1743. Extension of prescription drug discounts to enrollees of
Medicaid managed care organizations
Current Law
Medicaid law requires prescription drug manufacturers that
seek to sell any of their products to state Medicaid programs
to enter into a rebate agreement with the Secretary of HHS.
Under these agreements, manufacturers must provide state
Medicaid programs with rebates for the drugs purchased for
Medicaid beneficiaries on an outpatient basis, and state
Medicaid programs must cover all drugs (except certain
statutorily excluded drug classes) marketed by those
manufacturers. The rebates are shared by the state and federal
governments in proportion to their respective shares of
Medicaid drug expenditures.
Certain drugs are not subject to rebates, including drugs
dispensed by Medicaid managed care organizations (MCOs) that
contract on a risk basis with state Medicaid agencies when
prescription drugs are included in the capitation agreement
between the state Medicaid agency and the MCO. In states that
exclude or ``carve out'' prescription drug benefits from their
contracts with MCOs, the prescriptions for the Medicaid MCO
enrollees are purchased on a fee-for-service basis and the
drugs are subject to rebates.
Proposed Law
The bill would eliminate the current exemption of drugs
dispensed by Medicaid MCOs from the Medicaid rebate
requirements. Manufacturers entering into Medicaid rebate
agreements with the Secretary of HHS would be required to pay
rebates on covered outpatient drugs dispensed to Medicaid
beneficiaries enrolled in a Medicaid MCO if the organization is
responsible for coverage of such drugs under its risk contract
with the state Medicaid agency. As with other rebates, the
manufacturers would pay the rebates owed to the state Medicaid
agency, not to the MCO.
In order to implement this requirement, the bill would
require that all risk contracts between a state Medicaid agency
and a Medicaid MCO provide that the MCO report to the state
agency the information the agency needs in order to submit its
periodic report to the manufacturer regarding the covered
outpatient drugs dispensed to Medicaid beneficiaries enrolled
in the MCO for which the manufacturer owes rebates. The
Secretary would specify the timeliness and frequency with which
this information would have to be reported to state Medicaid
agencies by Medicaid MCOs. The bill would require state
Medicaid agencies to report to the Secretary, on a quarterly
basis, the total dollar amount of rebates received from
manufacturers for drugs provided to individuals enrolled in
Medicaid MCOs for which the organization is responsible for
coverage.
This provision would take effect on July 1, 2010, and would
apply to drugs dispensed on or after that date without regard
to whether or not final regulations to implement these changes
have been issued.
Sec. 1744. Payments for graduate medical education
Current Law
Medicare and Medicaid, in paying for inpatient hospital
services, have historically recognized two components of
graduate medical education (GME) costs: (1) direct graduate
medical education or DGME (e.g., resident salaries, teaching
supervision), and (2) indirect graduate medical education, or
IME (e.g., higher patient care costs because of additional
tests ordered by residents). The Medicaid statute requires that
states use a public process in determining payment rates for
hospital services and publish their proposed and final rates
and methodologies, but it does not specify payment for GME or
IME costs.
In May 2007, the Centers for Medicare & Medicaid Services
published a proposed rule to terminate federal Medicaid
matching funds for the costs of GME, 72 Federal Register at
28930 (May 23, 2007). Congress imposed a series of moratoria on
the implementation of this proposed rule through April 1, 2009.
Section 5003(d)(2) of the American Recovery and Reinvestment
Act of 2009 (P.L. 111-5) states a ``Sense of the Congress''
that the Secretary should not promulgate the May 23, 2007,
proposed rule as a final rule.
Section 2261 of the bill directs the Secretary of HHS to
establish a permanent Advisory Committee on Health Workforce
Evaluation and Assessment that is responsible for making
recommendations to the Secretary for policies to improve the
supply, diversity, and geographic distribution of the health
workforce.
Section 1505 of the bill specifies goals for approved
medical residency training programs for purposes of Medicare
GME payments. The goals are to foster a physician workforce so
that physicians are trained, among other things, to be able to
work effectively in various health care delivery settings,
coordinate patient care within and across settings, and be
meaningful electronic health records users.
Proposed Law
The bill would give state Medicaid programs express
statutory authority to make payments for the costs of graduate
medical education, whether provided in or outside of a
hospital, so long as certain requirements are met. In order to
receive federal Medicaid matching funds for the costs of GME,
state Medicaid programs would have to submit information to the
Secretary annually on total payments for GME and how those
payments are being used. In addition, state Medicaid GME
payments would have to be consistent with program goals and
requirements established by the Secretary by regulation, which
would take into account the recommendations of the Advisory
Committee on Health Workforce Evaluation and Assessment. The
purpose of these requirements is to ensure that federal
Medicaid matching funds for GME are effectively targeted to
support national health workforce goals, such as increasing the
supply of primary care practitioners.
The information that states would be required to submit to
the Secretary includes: (1) the institutions and programs
eligible for receiving the funding, (2) the manner in which
such payments are calculated, (3) the types and fields of
education being supported, (4) the workforce or other goals to
which the funding is being applied, (5) state progress in
meeting the goals established by the Secretary, and (6) any
other information the Secretary determines will help inform the
process of developing goals for approved medical residency
training programs.
The bill establishes the following process for developing
goals for approved medical residency programs. As described
above, the Secretary would specify the information relating to
GME that state Medicaid agencies must report as a condition of
receiving federal Medicaid matching funds for the costs of GME.
The Secretary would make the information submitted by the
states available to the Advisory Committee on Health Workforce
Evaluation and Assessment. Both the Secretary and the Advisory
Committee would independently review this information, taking
into account state and local workforce needs. The Advisory
Committee would then make recommendations to the Secretary.
By no later than December 31, 2011, the Secretary would
specify by rule program goals for the use of Medicaid GME
funds, taking into account the recommendations of the Advisory
Committee and the Medicare program goals for approved medical
residency training programs specified by section 1505 of the
bill. The rule would also specify requirements for the use of
Medicaid GME funds consistent with these program goals. The
Committee understands that as of 2005, 11 states linked
Medicaid GME payments to state policy goals and 17 states
extended Medicaid GME payments to training programs for health
professions beyond medical students. The Committee expects
that, in issuing the rule, the Secretary will consider
available data regarding the success of state efforts to link
Medicaid GME payment to workforce and other policy goals and
consult available survey data regarding State Medicaid GME
programs. The Secretary is authorized to issue this rule on an
interim final basis pending revision after an opportunity for
public comment.
The provision is effective on enactment and is not to be
construed to affect GME payments made by a state Medicaid
agency prior to enactment.
Sec. 1745. Report on Medicaid payments
Current Law
The Administrator of the Centers for Medicare & Medicaid
Services (CMS) is responsible for implementing the duty of the
Secretary of HHS to ensure that state Medicaid programs comply
with federal Medicaid requirements, including those relating to
the sufficiency of payments to physicians, hospitals, and other
providers for furnishing covered services to program
beneficiaries. The Medicaid statute does not require state
Medicaid programs to report to CMS information regarding
provider payment rates, methodologies, and justifications.
Proposed Law
The bill would require state Medicaid programs to submit to
the CMS Administrator, on an annual basis, information on
Medicaid payment rates to providers. The information would
include, for each class of provider (e.g., hospitals, nursing
facilities, pharmacies, physicians, etc.), final rates, the
methodologies used to determine the final rates, and
justifications for those rates. States would also have to
provide an explanation of the process used to allow providers,
beneficiaries and their representatives, and other concerned
state residents an opportunity to comment on rates,
methodologies, and justifications before the rates are made
final. The Committee expects that the Administrator would
review this information to determine whether states are in
compliance with applicable federal requirements, including
those relating to the sufficiency of provider payments.
Sec. 1746. Reviews of Medicaid
Current Law
Federal Medicaid matching payments to state Medicaid
programs for the costs of covered services are determined by
the federal medical assistance percentage (FMAP) formula set
forth in the Medicaid statute. The federal government also
provides matching funds for administrative costs incurred by
state Medicaid agencies at specified rates. The Government
Accountability Office (GAO) has expertise in the FMAP formula
and administration of the Medicaid program.
Proposed Law
The bill would direct the Comptroller General to conduct a
study regarding federal payments to state Medicaid programs and
submit a report to the appropriate committees on the effect of
the following policy changes on the federal government, States,
providers, and beneficiaries: (1) modifying the federal medical
assistance percentage (FMAP) by removing the 50% floor, the 83%
ceiling, or both; and (2) revising the current FMAP formula to
better reflect state fiscal capacity and state effort to pay
for health and long-term care services and to better adjust for
national or regional economic downturns. The report would be
due no later than February 15, 2011.
The bill would direct the Comptroller General to conduct a
study of the administration of the Medicaid program by the
Department of Health and Human Services, state Medicaid
agencies, and local government agencies and to submit a report
to the appropriate committees that would address the following
issues: (1) the administrative functions, such as survey and
certification and claims processing, on which federal Medicaid
funds are expended and the amounts of such expenditures
(whether spent directly or by contract) for each function; and
(2) the extent to which federal funds for each administrative
function are being used effectively and efficiently. The report
would be due no later than February 15, 2011.
Sec. 1747. Extension of delay in managed care organization provider tax
elimination
Current Law
The Medicaid statute allows states to use revenues from
taxes on hospitals, nursing facilities, and other providers to
fund the state share of Medicaid program costs if the tax meets
certain requirements. Among the classes of providers that a
state may tax subject to these requirements is managed care
organizations (MCOs). Originally this class was limited to
Medicaid managed care organizations with a risk contract with
the state Medicaid agency. Section 6051 of the Deficit
Reduction Act of 2005 (DRA, P.L. 109-171) broadened the
definition of this class to encompass all managed care
organizations. Under this revision, the revenues from an MCO
tax may not be used to fund the state share of Medicaid costs
unless the tax applies to all MCOs in the state, not just those
contracting with the state Medicaid program.
The DRA change was effective February 8, 2006, except in
states that, as of December 8, 2005, had enacted an MCO tax
that used the more limited definition of the class of MCOs
permissible under prior law (i.e., only those contracting with
Medicaid). The purpose of this exception was to provide the
excepted states with a grace period to revise their tax laws to
bring them into conformity with the broader definition of the
MCO class. This grace period ends on October 1, 2009.
Proposed Law
The bill would extend the grace period for states excepted
from the DRA change in the definition of a permissible MCO
class from October 1, 2009 to October 1, 2010. This change
would be effective as if included in the enactment of section
6051 of P.L. 109-171.
Subtitle F--Waste, Fraud, and Abuse
Sec. 1751. Health care acquired conditions
Current Law
Subject to federal rules, states generally establish their
own payment policies, rates, and reimbursement methodologies
for Medicaid providers, including inpatient facilities such as
hospitals, nursing facilities, and intermediate care facilities
for the mentally retarded (ICF/MRs). Federal regulations
require that Medicaid provider rates be sufficient to enlist
enough providers so that covered services are promptly
available at least to the extent that comparable care and
services are available to the general population within that
geographic area.
In Medicare, hospitals are reimbursed under a prospective
payment system (PPS), where each admission is classified into a
Medicare severity adjusted diagnosis-related group (MS-DRG)
based on the patient's diagnosis and procedures performed. Each
MS-DRG has a predetermined reimbursement amount. In general, a
hospital is paid the same amount for an MS-DRG regardless of
how long patients stay in the hospital or what is required to
treat the patient. In some situations under Medicare's PPS,
patients with certain complicating conditions could be
reclassified into different MS-DRGs where the hospital would
receive a higher payment.
To avoid additional hospital payments for complications
that were acquired during patients' admission, the Deficit
Reduction Act of 2005 (DRA, P.L. 109-171) required the
Secretary to initiate a hospital-acquired condition (HAC)
program for Medicare. In creating the HAC program, the
Secretary was to select conditions that: (1) were high cost,
high volume, or both; (2) were identified as complicating
conditions or major complicating conditions; and (3) were
reasonably preventable through the application of evidenced-
based guidelines. Starting October 1, 2007 (FY2008), CMS
required hospitals to report whether Medicare patients had
certain conditions when they were admitted. Beginning October
1, 2008 (FY2009), if the HAC conditions identified by the
Secretary were coded as present at admission, the conditions
would not be considered to be acquired during the patient's
hospital stay, and the case could receive additional MS-DRG
payment. In addition to the HAC policy, in January 2009, CMS
issued three national coverage determinations that precluded
Medicare from paying any amount for certain serious preventable
medical care errors. (These preventable errors are sometimes
called ``never events.'' Never events include surgery on the
wrong body part or mismatched blood transfusions, which can
cause serious injury or death to beneficiaries, and result in
increased costs to the Medicare program to treat the
consequences of the error.)
For Medicaid, CMS issued guidance to states in July 2008 to
help states appropriately align Medicaid inpatient hospital
payment policies with Medicare's HAC payment policies. In the
guidance, CMS indicated that for patients eligible for both
Medicare and Medicaid (dual eligibles), hospitals that were
denied payment under Medicare might attempt to bill Medicaid
for HACs as the secondary payer. CMS instructed state Medicaid
agencies to deny payment when dual eligible beneficiaries
acquired HACs during a hospitalization. CMS also encouraged
Medicaid agencies to implement policies to deny payment when
other Medicaid beneficiaries acquired HACs during a
hospitalization. CMS directed states to several Medicaid
authorities to deny payment appropriately for HACs, but unlike
Medicare, DRA did not specifically apply the HAC initiative to
Medicaid.
Proposed Law
This provision would require state Medicaid and CHIP
programs to deny hospital payments for HACs as well as for
certain serious preventable errors in medical care (never
events) determined as non-covered by the Medicare program. In
addition, states would have permission to identify other
health-care acquired conditions for non-payment under Medicaid.
This provision would be effective for hospital discharges that
occurred on or after January 1, 2010.
Sec. 1752. Evaluations and reports required under Medicaid Integrity
Program
Current Law
Under the Medicaid Integrity Program (MIP), the Secretary
is required to contract with eligible entities to conduct
program integrity activities such as auditing claims for
payment and identifying overpayments. The MIP program is funded
at $75 million per year.
Proposed Law
The bill would require eligible entities (MIP contractors)
to conduct periodic evaluations of the effectiveness of their
MIP contract activities and submit annual reports to CMS
documenting these evaluations. This reporting requirement would
be effective for contract years beginning in 2011.
Sec. 1753. Require providers and suppliers to adopt programs to reduce
waste, fraud, and abuse
Current Law
Section 1635 of the bill would require providers and
suppliers participating in Medicare (other than physicians and
skilled nursing facilities) to establish a compliance program
that contains core elements established by the Secretary of
HHS. There is no comparable requirement in the Medicaid
statute.
Proposed Law
The bill would require state Medicaid programs to require
that any participating provider or supplier (other than a
physician or nursing facility) to establish a compliance
program that contains core elements established by the
Secretary for purposes of the Medicare program under section
1635 of the bill. Those core elements could include (1) written
policies, procedures, and standards of conduct; (2) a
designated compliance officer and compliance committee; (3)
effective fraud, waste, and abuse training and education for an
entity's employees and contractors; (4) a mechanism, such as a
hotline, to report waste, fraud, and abuse that is confidential
or anonymous; (5) disciplinary guidelines to enforce standards;
(6) internal monitoring and auditing procedures, including
contractor monitoring and auditing; and (7) procedures for
ensuring prompt responses when offenses are detected, which
include development of corrective action initiatives, including
response to potential offenses, and (8) returning all
identified overpayments under Medicare, Medicaid and CHIP.
The bill authorizes the Secretary to conduct a pilot
program on the application of this requirement with respect to
a category of providers or services or suppliers (other than
physicians or skilled nursing facilities) determined to be at
high risk of waste, fraud, and abuse before requiring all
providers or services and suppliers (other than physicians or
skilled nursing facilities) to establish compliance programs.
State Medicaid programs would be required to align the
implementation of this requirement with the Secretary's
implementation of the pilot program.
The provision would be effective on enactment.
Sec. 1754. Overpayments
Current Law
The Medicaid statute requires that when an overpayment made
by a state Medicaid agency to a provider or contractor is
discovered, the agency has 60 days to recover or attempt to
recover the overpayment. At the end of the 60-day period,
federal Medicaid matching payments to the state are reduced by
the federal share of the overpayment, whether or not recovery
has been made. The only exception is when the state is unable
to recover because the overpayment (or a portion thereof) is a
debt that has been discharged in bankruptcy or is otherwise
uncollectable. The Committee heard testimony from state
Medicaid administrators that this policy deters states from
discovering overpayments due to fraud because the recovery of
funds from fraudulent providers often takes considerably longer
than 60 days, and during this extended period the federal
government withdraws the federal funds involved from the state.
Proposed Law
In order to encourage state Medicaid agencies to identify
overpayments due to fraud and seek recovery of the federal and
state funds involved, the bill would create an exception to the
60-day recovery rule for such overpayments. In the case of
overpayments due to fraud, the reduction in federal matching
payments would not occur until a year after the discovery of
the overpayment. This provision would apply to overpayments due
to fraud discovered on or after enactment. The Secretary would
not be required to issue regulations to implement this
provision.
Sec. 1755. Managed care organizations
Current Law
The Medicaid statute requires that state Medicaid agencies
that elect to enter into risk contracts with managed care
organizations (MCOs) to furnish services to program
beneficiaries make capitation payments to those MCOs on an
actuarially sound basis. The statute does not specify a minimum
medical loss ratio, or share of total premium revenue spent on
medical claims. The Congressional Budget estimates that in FY
2010 the federal government will spend $57.4 billion in
matching funds for Medicaid managed care services.
Proposed Law
The bill would require that every risk contract between a
state Medicaid agency and a Medicaid MCO have a medical loss
ratio specified by the Secretary that is not less than 85%. The
Secretary would specify the methodology to be used by State
Medicaid agencies in determining whether a contracting MCO is
in compliance with the medical loss ratio. The bill would apply
a parallel requirement to State CHIP programs that contract
with MCOs on a risk basis. Neither federal Medicaid or CHIP
matching funds would be available for expenditures in
connection with risk contracts or contracting MCOs that are not
in compliance with this requirement. The purpose of this
requirement is to ensure that the maximum amount of capitation
revenues received by an MCO from Medicaid or CHIP programs are
used to pay providers for furnishing covered services to
enrolled beneficiaries rather than to pay for MCO
administrative costs, marketing costs, taxes and other fees, or
distributions to shareholders. This requirement would apply to
contracts between state Medicaid or CHIP agencies and MCOs
entered into or renewed on or after July 1, 2010. The Secretary
is not required to issue a rule to implement this requirement.
The bill would require that each risk contract entered into
between a state Medicaid agency and an MCO require that the MCO
provide to the state Medicaid agency patient encounter data
sufficient to identify the physician who delivers services to
enrollees. To ensure comparability of patient encounter data
among MCOs within a state and between MCOs in one state and
those in another, the bill requires the Secretary to specify
the frequency and level of detail of the patient encounter data
to be supplied by each MCO. This provision would apply with
respect to contract years beginning on or after January 1,
2010. The Secretary would not be required to implement this
provision by regulation.
Sec. 1756. Termination of provider participation under Medicaid and
CHIP if terminated under Medicare or other State plan or child
health plan
Current Law
Subject to certain specified exceptions, the Secretary of
HHS is required to exclude from participation in any federal
health care program, including Medicare and Medicaid and CHIP,
for a specified period of time individuals or entities that
have been convicted of certain criminal offenses. The Secretary
also has the authority to exclude for a specified period of
time individuals or entities that have engaged in certain
specified conduct. The Medicaid statute requires that state
Medicaid agencies exclude an individual or entity from the
Medicaid program, for the period specified by the Secretary,
when the individual or entity is excluded by the Secretary.
Proposed Law
The bill would require state Medicaid programs to terminate
the participation of any individual or entity in Medicaid if
the individual or entity is terminated from participation in
Medicare, any other state Medicaid program, or CHIP. Subject to
certain specified exceptions, when Medicare provider
reimbursement is precluded as a result of the termination of
provider participation for reasons such as those listed above,
this provision would require states to terminate federal
financial participation for such providers under Medicaid and/
or CHIP.
This provision would be effective for services provided on
or after January 1, 2011, regardless of whether or not final
regulations had been promulgated. If the Secretary determines
that a state requires legislation (other than appropriations
legislation) to amend its state Medicaid plan, then the state
would not be considered to be out of compliance with this
requirement until after the first day of the first calendar
quarter after the close of the first regular state legislature
session after enactment. In states with two-year legislative
sessions, the Secretary would consider each year of the
legislative session as a separate regular session of the state
legislature.
Sec. 1757. Medicaid and CHIP exclusion from participation relating to
certain ownership, control, and management affiliations
Current Law
Titles XI, XIX, and XXI of the Social Security Act specify
the circumstances under which State Medicaid and Children's
Health Insurance (CHIP) programs are required to exclude
providers from participation.
Proposed Law
This bill would require state Medicaid and CHIP agencies to
exclude any individual or entity from participation in Medicaid
or CHIP for a period if the individual or entity owns,
controls, or manages an entity that: (1) has overpayments under
Medicaid or CHIP that have not been repaid and that the
Secretary or state agency has determined to be delinquent
during the period; (2) is suspended, excluded from
participation under, or terminated from participation under
Medicaid or CHIP during the period; or (3) is affiliated with
an individual or entity that has been suspended, excluded, or
terminated from participation in Medicaid or CHIP during the
period.
This provision would be effective for services furnished
under the Medicaid and CHIP programs on or after January 1,
2011, without regard to whether or not final regulations had
been promulgated. If the Secretary determines that a state
requires legislation (other than appropriations legislation) to
amend its state Medicaid plan, then the state would not be
considered to be out of compliance with this requirement until
after the first day of the first calendar quarter after the
close of the first regular state legislature session after
enactment. In states with two-year legislative sessions, the
Secretary would consider each year of the legislative session
as a separate regular session of the state legislature.
Sec. 1758. Requirement to report expanded set of data elements under
MMIS to detect fraud and abuse
Current Law
The Medicaid statute requires that state Medicaid programs,
as a condition of receiving federal matching funds for
automated data systems, operate a Medicaid Management
Information System (MMIS) that meets certain specifications.
For example, an MMIS system must provide for electronic
transmission of claims data in a format specified by the
Secretary of HHS.
Proposed Law
The bill would require state MMIS systems to transmit to
the Secretary data elements determined by the Secretary to be
necessary for the detection of waste, fraud, and abuse. This
requirement would be effective with respect to state data
submissions to the Secretary occurring on or after July 1,
2010.
Sec. 1759. Billing agents, clearinghouses, or other alternate payees
required to register under Medicaid
Current Law
Section 1644 of the bill would require any agency,
clearinghouse, or other alternate payee that submits claims to
Medicare for reimbursement on behalf of a health care provider
to register with the Secretary. There is no comparable
requirement in Medicaid law.
Proposed Law
The bill would require state Medicaid agencies to require
that any agent, clearinghouse, or other alternate payee that
submits claims for Medicaid reimbursement on behalf of a health
care provider register with the state Medicaid agency and with
the Secretary in a form and manner that is consistent with the
Medicare process for the enrollment of providers of services
and supplies. Federal Medicaid matching funds would not be
available to the state for any amounts paid to agents,
clearinghouses, or other alternate payees that fail to
register.
This provision would be effective for claims submitted on
or after January 1, 2012, without regard to whether or not
final regulations had been promulgated.
Sec. 1760. Denial of payments for litigation-related misconduct
Current Law
The federal government pays 50% of administrative costs
incurred by states as are found necessary by the Secretary of
HHS for the proper and efficient administration of the Medicaid
program. Allowable administrative costs that qualify for
federal matching include attorneys' fees and other litigation
expenses incurred by states related to the Medicaid program.
Proposed Law
The bill would prohibit the payment of federal Medicaid
matching funds for any amounts expended on litigation in which
a court imposes sanctions on a state, its employees, or its
counsel for litigation-related misconduct. For this purpose,
litigation includes administrative proceedings that are subject
to laws and rules of procedure that authorize the imposition of
sanctions for litigation misconduct. Examples of such
litigation include state litigation with federal agencies,
Medicaid contractors, health care providers, or Medicaid
beneficiaries.
The bill would also prohibit the payment of federal
Medicaid matching funds for any amounts to reimburse directly
(or compensate through a capitation payment or otherwise) a
managed care entity for payment of legal expenses associated
with any action in which a court imposes sanctions on the
managed care entity for litigation-related misconduct. For this
purpose, litigation includes administrative proceedings that
are subject to laws and rules of procedure that authorize the
imposition of sanctions for litigation misconduct. Examples of
such litigation include litigation with state or federal
agencies, health care providers or Medicaid beneficiaries.
Federal Medicaid matching funds would continue to be
available at a 50% rate for all other litigation costs as the
Secretary finds necessary for the proper and efficient
administration of the Medicaid program. The prohibition would
apply to amounts expended for litigation expenses on or after
January 1, 2010. The Secretary would not be required to issue
regulations to implement this prohibition.
Sec. 1761. Mandatory State use of national correct coding initiative
Current Law
The Medicaid statute requires that state Medicaid programs,
as a condition of receiving federal matching funds for
automated data systems, operate a Medicaid Management
Information System (MMIS) that meets certain specifications
relating to the processing of provider claims for
reimbursement.
The Centers for Medicare & Medicaid Services processes
Medicare Part B claims, including claims for payments for
physician, laboratory, and radiology services. In 1996, to help
ensure correct payment of claims for reimbursement, CMS
implemented the National Correct Coding Initiative (NCCI).
Under NCCI, CMS contractors use automated pre-payment edits to
review Medicare claims submitted by Part B providers to detect
anomalies that indicate a claim has incorrect information and
should not be paid as submitted.
Proposed Law
The bill would require that each state's MMIS system
incorporate methodologies compatible with Medicare's National
Correct Coding Initiative (or any successor initiative to
promote correct coding and to control improper coding leading
to inappropriate payment) and such other methodologies as the
Secretary specifies. MMIS systems would have to meet this
requirement effective for claims filed on or after October 1,
2010.
To enable state Medicaid programs to implement this
requirement, the bill would require the Secretary, by September
1, 2010, to take the following actions: (1) identify NCCI
methodologies (or methodologies of any successor initiative)
that are compatible to claims filed under Medicaid; (2)
identify those methodologies that should be incorporated into
claims filed under Medicaid with respect to items or services
covered under Medicaid for which no national correct coding
methodologies have been established with respect to Medicare;
(3) notify states of the coding methodologies identified and
how states should incorporate those methodologies into their
Medicaid claims processing systems; and (4) submit a report to
Congress that includes the notice given to states about the
methodologies and an analysis that supports the identification
of the methodologies to be applied to Medicaid claims.
The provision is effective on enactment. If the Secretary
determines that a state requires legislation (other than
appropriations legislation) to amend its state Medicaid plan,
then the state would not be considered to be out of compliance
with this requirement until after the first day of the first
calendar quarter after the close of the first regular state
legislature session after enactment. In states with two-year
legislative sessions, the Secretary would consider each year of
the legislative session as a separate regular session of the
state legislature.
Subtitle G--Payments to the Territories
Sec. 1771. Payment to the territories
Current Law
The five U.S. territories--American Samoa, Guam, the
Northern Mariana Islands, Puerto Rico, and the Virgin Islands--
are eligible to participate in the Medicaid program but not on
the same basis as the states (and the District of Columbia).
The federal medical assistance percentage (FMAP) in the
territories is set at 50%, rather than varying with per capita
income between 50% and 83%, as in the case of the states. Total
federal Medicaid matching payments in any fiscal year are
subject to a statutory ceiling specific to each territory; in
contrast, the federal government shares in the cost of all
allowable Medicaid expenditures made by states without regard
to a ceiling. In the case of American Samoa and Northern
Marianas Islands, the Secretary has broad statutory authority
to waive or modify almost all federal Medicaid requirements
that apply to states participating in Medicaid.
Section 5001(d) of the American Recovery and Reinvestment
Act of 2009 (ARRA, P.L. 111-5) allows each territory, for the
period October 1, 2008, through December 31, 2010, a one-time
choice between (1) an FMAP increase of 6.2 percentage points
and a 15% increase in its statutory ceiling on federal Medicaid
spending, or (2) its regular 50% FMAP and a 30% increase in its
spending ceiling. All five territories have elected the 30%
increase in their federal Medicaid spending ceiling.
Proposed Law
The bill would increase the FMAP for each of the
territories from FY2011 through FY2019 to the highest FMAP in
effect in that year for any state. For the first quarter of
FY2011, this state FMAP would take into account the temporary
FMAP increases under section 5001(a) and (b)(1) of ARRA. (The
highest regular FMAP of any state in FY2009 was 75.8%).
The bill would increase the ceilings on federal Medicaid
matching payments to each of the territories from FY2011
through FY2019 by the following amounts:
For Puerto Rico, for fiscal year 2011, $727.6 million; for
fiscal year 2012, $775 million; for fiscal year 2013, $850
million; for fiscal year 2014, $925 million; for fiscal year
2015, $1 billion; for fiscal year 2016, $1.075 billion; for
fiscal year 2017, $1.150 billion; for fiscal year 2018, $1.225
billion; and for fiscal year 2019, $1.396 billion.
For the Virgin Islands, for fiscal year 2011, $34 million;
for fiscal year 2012, $37 million; for fiscal year 2013, $40
million; for fiscal year 2014, $43 million; for fiscal year
2015, $46 million; for fiscal year 2016, $49 million; for
fiscal year 2017, $52 million; for fiscal year 2018, $55
million; and for fiscal year 2019, $58 million.
For Guam, for fiscal year 2011, $34 million; for fiscal
year 2012, $37 million; for fiscal year 2013, $40 million; for
fiscal year 2014, $43 million; for fiscal year 2015, $46
million; for fiscal year 2016, $49 million; for fiscal year
2017, $52 million; for fiscal year 2018, $55 million; and for
fiscal year 2019, $58 million.
For the Northern Mariana Islands, for fiscal year 2011,
$13.5 million; for fiscal year 2012, $14.5 million; for fiscal
year 2013, $15.5 million; for fiscal year 2014, $16.5 million;
for fiscal year 2015, $17.5 million; for fiscal year 2016,
$18.5 million; for fiscal year 2017, $19.5 million; for fiscal
year 2018, $21 million and for fiscal year 2019, $22 million.
For American Samoa, for fiscal year 2011, $22 million; for
fiscal year 2012, $23.688 million; for fiscal year 2013,
$24.688 million; for fiscal year 2014, $25.688 million; for
fiscal year 2015, $26.688 million; for fiscal year 2016,
$27.688 million; for fiscal year 2017, $28.688 million; for
fiscal year 2018, $29.688 million; and for fiscal year 2019,
$30.688 million.
The bill would expand the scope of the Secretary's current
waiver authority with respect to American Samoa and the
Northern Mariana Islands to include Puerto Rico, the Virgin
Islands, and Guam. The bill would not alter the current law
prohibition on waiving the FMAP, the federal spending ceilings,
or the requirement that payment be made for Medicaid services
described in section 1905(a) of the Social Security Act.
The bill directs the Secretary of HHS to submit a report to
Congress that details a plan for the transition of each
territory to full parity in Medicaid with the states in FY
2020. The transition plan must outline the actions that the
Secretary and the governments of each territory must take by FY
2020 to ensure parity in financing. The report must include (1)
a projection of the FMAP for each territory if the FMAP formula
applicable to the states were applied to the territory; (2)
recommendations as to whether the federal spending ceilings for
each territory should be increased any time before fiscal year
2020 due to any factors that the Secretary deems relevant; (3)
information about per capita income data that could be used to
calculate FMAPs for each territory and on how such data might
differ from the per capita income data used to promulgate FMAPs
for the states; and (4) recommendations on how the FMAP would
be calculated for the territories beginning in fiscal year 2020
to ensure parity with the states.
The Secretary's initial report would be due to Congress not
later than October 1, 2013. The Secretary would be required to
submit subsequent reports to Congress in 2015, 2017, and 2019
detailing the progress that the Secretary and the governments
of each territory have made in fulfilling the actions outlined
to achieve Medicaid parity in the Secretary's plan for
transition to full parity in FY 2020.
The bill would require the Secretary provide technical
assistance to the territories in upgrading their existing
computer systems in order to anticipate meeting reporting
requirements necessary to implement the transition plan
prepared by the Secretary. The costs of this technical
assistance would not be counted against the federal spending
ceilings.
Subtitle H--Miscellaneous
Sec. 1781. Technical corrections
Section 1144 of the Social Security Act. Section 1144(c)(3)
of the Social Security Act directs the Commissioner of Social
Security to transmit applications for low-income subsidies
under Medicare Part D to the appropriate State Medicaid agency
in order to initiate an application for assistance under the
Medicare Savings Program. The bill makes technical changes in
the statutory text to correctly execute this policy. The
provision is effective as if included in the enactment of
section 113(b) of P.L. 110-275 (July 15, 2008).
Section 1935 of the Social Security Act. Section 1935(a)(4)
of the Social Security Act requires state Medicaid agencies to
accept data transmitted electronically by the Commissioner of
Social Security regarding applications for low-income subsidies
under Medicare Part D and to treat this data as an application
for assistance under the Medicare Savings Program (MSP). The
bill clarifies that the date of transmission by the
Commissioner is the date of filing of the application for MSP
for purposes of the state Medicaid agency's duty to process
applications and to furnish medical assistance to eligible
applicants with reasonable promptness. The provision is
effective as if included in the enactment of section 113(b) of
P.L. 110-275 (July 15, 2008).
Section 605 of CHIPRA. Section 605 of the Children's Health
Insurance Program Reauthorization Act of 2009 (CHIPRA; P.L.
111-3) provides that nothing in CHIPRA allows federal payment
for individuals who are not lawfully residing in the United
States. The bill makes a technical change to an erroneous
reference to ``legal residents'' in the statutory text to
correctly execute this policy.
Section 1905 of the Social Security Act. Section 1905(a) of
the Social Security Act defines the term ``medical
assistance.'' The term is expressly defined to refer to payment
but has generally been understood to refer to both the funds
provided to pay for care and services and to the care and
services themselves. The Committee, which has legislative
jurisdiction over Title XIX of the Social Security Act, has
always understood the term to have this combined meaning. Four
decades of regulations and guidance from the program's
administering agency, the Department of Health and Human
Services, have presumed such an understanding and the Congress
has never given contrary indications.
Some recent court opinions have, however, questioned the
longstanding practice of using the term ``medical assistance''
to refer to both the payment for services and the provision of
the services themselves. These opinions have read the term to
refer only to payment; this reading makes some aspects of the
rest of Title XIX difficult and, in at least one case, absurd.
If the term meant only payments, the statutory requirement that
medical assistance be furnished with reasonable promptness ``to
all eligible individuals'' in a system in which virtually no
beneficiaries receive direct payments from the state or federal
governments would be nearly incomprehensible.
Other courts have held the term to be payment as well as
the actual provision of the care and services, as it has long
been understood. The Circuit Courts are split on this issue and
the Supreme Court has declined to review the question. To
correct any misunderstandings as to the meaning of the term,
and to avoid additional litigation, the bill would revise
section 1905(a) to read, in relevant part: ``The term `medical
assistance' means payment of part or all of the cost of the
following care and services, or the care and services
themselves, or both.'' This technical correction is made to
conform this definition to the longstanding administrative use
and understanding of the term. It is effective on enactment.
Section 1115 of the Social Security Act. Section 1115(a) of
the Social Security Act authorizes the Secretary of HHS to
waive compliance with the state Medicaid plan requirements
under section 1902 of the Act if the Secretary finds the waiver
necessary to enable a state to carry out a demonstration
project that is likely to assist in promoting the objectives of
Title XIX. The section also authorizes the Secretary to approve
costs for such a demonstration project that would not otherwise
be eligible for federal Medicaid matching payments under
section 1903 of the Act. Section 1115(a) does not, however,
provide statutory authority for either the states or the
Secretary to use federal funds to provide health or long-term
care services to low-income individuals independent of the
usual requirements for the expenditure of funds under Title XIX
of the Act.
The bill would clarify that if the Secretary approves a
Medicaid demonstration project under section 1115(a), the
demonstration project is to be treated as part of the state's
Medicaid plan, subject to all of the usual state Medicaid plan
requirements in section 1902(a) that have not been explicitly
waived by the Secretary under the demonstration. All of the
payments for care and services provided on behalf of any
individuals affected by the demonstration project, including
payments for ``costs not otherwise matchable'' under section
1115(a)(2), are medical assistance provided under the State
Medicaid plan. The individuals affected by the demonstration
project are individuals receiving medical assistance under the
state Medicaid plan, and all provisions of Title XIX not
expressly waived by the Secretary in approving the project
remain fully applicable to all individuals eligible for or
receiving benefits under the state Medicaid plan.
This clarification is effective on enactment.
Sec. 1782. Extension of QI program
Current Law
Medicaid pays Medicare Part B premiums for Medicare
beneficiaries, referred to as ``qualifying individuals'' (QIs),
with incomes between 120% and 135% of the federal poverty level
and assets no greater than $4,000 for an individual and $6,000
for a couple. The federal government matches 100% of the cost
of this premium assistance up to an allocation amount specific
to each state for each fiscal year. To enable states to
administer the program within a fixed allocation, the Medicaid
statute sets forth procedures for selecting which eligible
Medicare beneficiaries receive assistance with their premiums
and specifies that this assistance is not an individual
entitlement. The QI program ends in December 2010.
Proposed Law
The bill would extend the QI program through December 2012
and convert the program to an individual entitlement to
assistance with the cost of Part B premiums. The state
allocation limits, and the procedures for selecting among
eligible Medicare beneficiaries within those limits, would be
removed. The 100% FMAP would continue to apply to the costs of
this assistance for QIs. The provision would take effect on
January 1, 2011.
Sec. 1783. Outreach and enrollment of Medicaid and CHIP eligible
individuals
Current Law
Section 201 of the Children's Health Insurance Program
Reauthorization Act (CHIPRA, P.L. 111-3) provides $100 million
over the period FY 2009 through FY 2010 for grants by the
Secretary of HHS to states, localities, schools, nonprofit
organizations, and other eligible entities to conduct outreach
and enrollment efforts to increase the enrollment and
participation of eligible children in Medicaid and CHIP. Ten
percent of this amount is set aside for a national enrollment
campaign to be developed by the Secretary in order to improve
the enrollment of underserved child populations in Medicaid and
CHIP. Section 212 of CHIPRA requires state CHIP programs to
describe the procedures they use to reduce administrative
barriers to the enrollment of eligible children and pregnant
women in Medicaid and CHIP.
Proposed Law
The bill would require the Secretary of HHS to issue
guidance regarding (1) standards and best practices for
conducting outreach to inform eligible individuals about
coverage under Medicaid or CHIP, (2) providing assistance to
these individuals for enrollment in the appropriate program,
and (3) establishing methods or procedures for eliminating
application and enrollment barriers. The guidance relating to
outreach and enrollment methods must address address how
methods such as outstationing of eligibility workers, express
lane eligibility, presumptive eligibility, continuous
eligibility, and automatic renewal can be used to specifically
target vulnerable and underserved populations: children,
unaccompanied homeless youth, victims of abuse or trauma,
individuals with mental health or substance related disorders,
and individuals with HIV/AIDS.
The bill would require that the Secretary issue this
guidance not later than 12 months after enactment. Beginning
two years after enactment, the Secretary would be required to
review and report to Congress annually on progress in
implementing targeted outreach, application and enrollment
assistance, and administrative simplification methods for
vulnerable and underserved populations.
Sec. 1784 Prohibitions on Federal Medicaid and CHIP payment for
undocumented aliens
Current Law
The Medicaid statute prohibits federal payments to state
Medicaid programs for Medicaid services furnished to
unauthorized aliens (i.e., aliens not lawfully admitted for
permanent residence or otherwise permanently residing in the
U.S. under color of law). The statute makes an exception for
services that are necessary to treat an emergency medical
condition of an unauthorized alien who otherwise meets Medicaid
eligibility requirements. The Personal Responsibility and Work
Opportunity Reconciliation Act of 1996 (PRWORA, P.L. 104-193)
prohibits noncitizens who are not considered to be ``qualified
aliens'' (e.g., legal permanent residents, asylees, refugees)
from receiving Medicaid or CHIP benefits (other than for
treatment of an emergency medical condition).
Proposed Law
The bill provides that nothing in Title VII of Division B
shall change current prohibitions against federal Medicaid and
CHIP payments under titles XIX and XXI of the Social Security
Act on behalf of individuals who are not lawfully present in
the United States.
Sec. 1785. Demonstration project for stabilization of emergency medical
conditions by non-publicly owned or operated institutions for
mental diseases
Current Law
Medicaid does not reimburse for services provided to
Medicaid beneficiaries receiving care in institutions for
mental disease (IMD), except to those patients under age 21
receiving inpatient psychiatric care and individuals age 65 and
over. The Medicaid statute defines an IMD as a hospital,
nursing facility, or other institution of more than 16 beds
that is primarily engaged in providing diagnosis, treatment, or
care of persons with mental diseases, including medical
attention, nursing care and related services.
Proposed Law
The Secretary of HHS would be required to establish a
three-year Medicaid demonstration project under which eligible
states would reimburse IMDs that are not publicly owned or
operated for services provided to Medicaid eligibles age 21 to
64 who are in need of medical assistance to stabilize an
emergency medical condition. The Secretary would select among
states applying to participate in the project so as to provide
geographic diversity.
The bill appropriates $75 million in FY 2010 to carry out
this demonstration project. These funds would remain available
for obligation through December 31, 2012. Within this $75
million total, the Secretary would allocate funds among states
selected to participate in the program. The Secretary would use
these funds to pay, on a quarterly basis, the federal share of
the cost of the project at the state's regular federal matching
rate, up to the state's allocation. The Secretary could not
make a matching payment to a state under this project after
December 31, 2012.
For purposes of carrying out this demonstration project,
the bill requires the Secretary to waive the limitation on
payment for services to Medicaid beneficiaries residing in
IMDs. The bill authorizes (but does not require) the Secretary
to waive other requirements of Titles XI and XIX of the Social
Security Act, including the requirements of statewideness and
comparability, only to the extent necessary to carry out the
demonstration project.
The Secretary would be required to establish a mechanism
for in-stay review before the third day of inpatient stay to
determine whether or not an individual with an emergency
medical condition has been stabilized (i.e., the emergency
medical condition no longer exists with respect to the
individual and the individual is no longer dangerous to him or
herself or others).
Up to $75 million would be appropriated for fiscal year
2010. Such funds would remain available for obligation for
three years through December 31, 2012. The Secretary would be
required to allocate funds, on a quarterly basis, based on
their availability and the FMAP formula.
The bill would require the Secretary to submit annual
reports to Congress on the progress of the demonstration
project as well as a final report that includes an evaluation
of the demonstration's impact on the functioning of the health
and mental health service system and on Medicaid enrollees. The
bill specifies certain evaluation measures, including whether
the project produced a significant reduction in emergency room
visits or the duration of emergency room stays by Medicaid
beneficiaries. The Secretary would be required to include in
the final report a recommendation regarding whether the
demonstration project should be continued after December 31,
2012, and expanded on a national basis.
TITLE IX--MISCELLANEOUS PROVISIONS
Sec. 1901. Repeal of the trigger provision
Current Law
The Hospital Insurance (HI) and Supplementary Medical
Insurance (SMI) trust funds are overseen by a board of trustees
that reports annually to Congress. The Medicare Prescription
Drug, Improvement, and Modernization Act of 2003 (P.L. 108-173,
MMA), Subtitle A of title VIII requires the trustees' report to
include an expanded analysis of Medicare expenditures and
revenues. Specifically, a determination must be made as to
whether or not general revenue financing will exceed 45% of
total Medicare outlays within the next seven years. General
revenue financing is defined as total Medicare outlays minus
dedicated financing sources (i.e., HI payroll taxes; income
from taxation of Social Security benefits; state transfers for
prescription drug benefits; premiums paid under Parts A, B, and
D; and any gifts received by the trust funds). MMA requires
that if an excess general revenue funding determination is made
for two successive years, the President must submit a
legislative proposal to respond to the warning. Congress is
required to consider the proposals on an expedited basis.
However, passage of legislation within a specific time frame is
not required.
Proposed Law
Because the 45% trigger is an arbitrary threshold with no
connection to program efficiency or Medicare's long-term
sustainability, it should not be given preference in setting
the agenda for consideration of modifications to the program.
This provision repeals the 45% trigger.
Sec. 1902. Repeal of the comparative cost adjustment (CCA) program
Current Law
The MMA requires the Secretary to establish a program for
the application of comparative cost adjustment (CCA) in CCA
areas beginning in 2010. The six-year program will begin
January 1, 2010, and end December 31, 2015. The program is
designed to test direct competition among local Medicare
Advantage (MA) plans, as well as competition between local MA
plans and fee-for-service Medicare. This program will occur
only in a limited number of statutorily qualifying areas in the
country.
The benchmark for MA local plans in a CCA area will be
calculated using a formula that weights (1) the projected (fee-
for-service) FFS spending in an area (with certain adjustments
for demographics and health status) and (2) a weighted average
of plan bids.
For Medicare beneficiaries in traditional Medicare, Part B
premiums in CCA areas will be adjusted either up or down,
depending on whether the FFS amount is more or less than the
CCA area benchmark. If the FFS amount is greater than the
benchmark, beneficiaries in traditional Medicare FFS will pay a
higher Part B premium than other FFS beneficiaries in non-CCA
areas. If the FFS amount is less than the benchmark, the Part B
premium for FFS beneficiaries will be reduced by 75% of the
difference. These increases and decreases are subject to a 5%
limit; that is, adjustments to Part B premiums in CCA areas
cannot exceed 5% of the national part B premium. Beneficiaries
in traditional Medicare FFS with incomes below 150% of poverty,
who qualify for low-income subsidies under the Medicare
prescription drug program, will not have their Part B premium
increased.
Proposed Law
The CCA demonstration is projected by CBO to increase
government spending because it incorporates inflated Medicare
Advantage benchmarks. That runs counter to its goal of
improving program efficiency. Accordingly, in order to minimize
waste, the provision repeals the comparative cost adjustment
program.
In addition, the provision addresses the problem of
beneficiaries in fee-for-service Medicare facing changes in
their Part B premiums resulting from the bidding behaviors of
private Medicare Advantage.
Sec. 1903. Extension of gainsharing demonstration
Current Law
Section 5007 of the Deficit Reduction Act of 2005 (P.L.109-
171; DRA) authorizes a gainsharing demonstration to evaluate
arrangements between hospitals and physicians designed to
improve the quality and the efficiency of care provided to
beneficiaries. In the absence of this DRA authority,
gainsharing arrangements are restricted by the Civil Monetary
Penalty law. CMS is operating two projects, each consisting of
one hospital in New York and West Virginia. Although authorized
to begin on January 1, 2007, the project began on October 1,
2008, and will end as mandated on December 31, 2009. The
Secretary was required to submit a report on quality
improvement and achieved savings as a result of the
demonstration no later than December 1, 2008. The final report
on these issues was due on May 1, 2010. The project was
appropriated $6 million in FY2006 to be available for
expenditure through FY2010.
Proposed Law
The authority to conduct the gainsharing demonstration
would be extended until September 30, 2011. The due date of the
quality improvement and achieved savings report would be
extended from December 1, 2008, to March 31, 2011. The final
report would be due March 31, 2013, instead of May 1, 2010. An
additional $1.6 million would be appropriated in FY2010. All
appropriations would be available for expenditure through
FY2014.
Sec. 1904. Grants to States for quality home visitation programs for
families with young children and families expecting children
and families expecting children
and
Sec. 1905. Improved coordination and protection for dual eligibles
Current Law
There are no specific provisions in current law for
coordination and protection of dual eligibles.
Proposed Law
The provision directs the Secretary to create an
identifiable office or program within CMS to improve
coordination between Medicare and Medicaid and to improve
protections for dual eligibles. Dual eligibles would be defined
as individuals eligible for both Medicare and Medicaid and
would include those individuals who are eligible for benefits
under the Medicare Savings Program (MSP). The CMS office or
program would: (1) review Medicare (Parts A, B, and C) and
Medicaid policies on enrollment, benefits, service delivery,
payment, and grievance and appeals processes; (2) identify
areas of Medicare and Medicaid policies where better
coordination or protection could improve care and reduce costs
for duals; and (3) issue guidance to states on how to improve
coordination and protection for dual eligibles.
The elements of improved coordination and protection would
include efforts (1) to simplify access by dual eligibles to
benefits and services under Medicare and Medicaid; (2) to
improve care continuity for dual eligibles and ensure safe and
effective care transitions; (3) to harmonize regulatory
conflicts between Medicare and Medicaid rules affecting dual
eligibles; and (4) to improve Medicare and Medicaid's combined
total cost and quality performance for dual eligibles.
The Secretary's responsibilities for implementing the CMS
office or program for coordination and protection for dual
eligibles would include: (1) examination of Medicare and
Medicaid payment systems to develop strategies to foster more
integrated and higher quality care; (2) development of methods
to facilitate access for dual eligibles to post-acute and
community-based services and to identify actions to improve
coordination of community-based care; (3) a study of enrollment
in MSP (for both Medicare and Medicaid) to identify methods to
more efficiently and effectively reach and enroll dual
eligibles; (4) an assessment of communication strategies aimed
at dual eligibles, including the Medicare website, 1-800-
MEDICARE, and the Medicare handbook; (5) research and
evaluation of areas where service utilization, quality, and
access to cost sharing protection could be improved and an
assessment of factors relating to enrollee satisfaction with
services and delivery; (6) collection and dissemination to the
public of data and a database that describes eligibility,
benefits, and cost-sharing assistance available to dual
eligibles by state; (7) monitoring total combined Medicare and
Medicaid program expenditures in serving dual eligibles and
making recommendations to optimize total quality and cost
performance across both programs; and (8) coordination of
Medicare Advantage plan activities under Medicare and Medicaid.
Within one year after enactment of this provision and then
every three years thereafter, the Secretary would be required
to submit a report to Congress on the progress in improving
coordination and protection for dual eligibles as described in
this provision.
Sec. 1906. Standardized marketing requirements under the Medicare
Advantage and Medicare prescription drug plans (PDP)
Current Law
Medicare Advantage (MA) organizations are required to
submit marketing brochures and enrollment forms to CMS for
review and approval at least 45 days before distribution. If
using CMS model materials, the approval time is reduced from 45
to 10 days. As part of the review process, CMS must ensure that
the information provided to beneficiaries is not inaccurate or
misleading. MA organizations are also required to develop
marketing materials that provide an adequate description of
plan benefits, providers, and co-insurance; an explanation of
the grievance and appeals process; notification of the open
enrollment period; and a statement indicating that either the
plan or CMS can terminate the contract, thereby resulting in
the beneficiary's disenrollment from the plan.
CMS has also developed standards for regulating the
marketing conduct of MA organizations. These standards include
prohibitions against door-to-door soliciting, providing cash or
other monetary rebates to induce enrollment, and conducting
misleading or confusing activities, such as claiming that the
MA organization has been endorsed by CMS or Medicare. Further,
providers cannot distribute information to beneficiaries
comparing benefits across plans or allow beneficiaries to
complete enrollment applications in provider offices.
Except in instances where the beneficiary initiates
contact, plans will be prohibited from soliciting beneficiaries
door-to-door or on the phone. Cross-selling of non-health
products, providing meals to prospective enrollees, marketing
or selling plans at educational events or in areas where health
care is delivered (i.e., physician offices or pharmacies), and
using sales agents that are not state licensed are also
prohibited. The Medicare Improvement for Patients and Provides
Act required that by November 15, 2008, the Secretary establish
limitations on other plan marketing activities such as co-
branding, the scope of marketing appointments with prospective
enrollees, and agent compensation and training. MA plans will
be required to provide states with information on (1) agent and
broker terminations and (2) at state request, performance and
licensing of agents, brokers, and any third party representing
the plan. After January 1, 2010, MA plans will be required to
include the plan type in all plan names.
Proposed Law
This provision would require the Secretary to request the
National Association of Insurance Commissioners (NAIC) to
develop standardized marketing requirements for MA and PDP
plans and submit a report with the requirements to the
Secretary no later than 9 months after the enactment date of
this legislation. The requirements would be required to include
the prohibitions on marketing activities already included in
the statute and may prohibit a MA or PDP plan from completing
any portion of an election form.
The standardized marketing requirements would also be
required to include the following standards: (1) standards
related to fair and appropriate commissions for MA and PDP plan
agents and brokers, including a prohibition on extra bonuses or
incentives; (2) standards for the disclosure of commissions;
and (3) standards related to other forms of compensation.
Standards would be required to ensure that the compensation
paid to agents and brokers create incentives for enrolling
beneficiaries in a plan that best meets their health care
needs. Standards must also address the conduct of agents
participating in on-site promotions at facilities that have a
co-branding relationship with the MA or PDP plan. The NAIC
would have the discretion to establish other standards related
to unfair marketing and trade practices.
If the NAIC develops these standards and submits the
required report to the Secretary, the Secretary would be
required to promulgate regulations adopting the NAIC's
requirements. If the NAIC does not develop or submit a report
to the Secretary, the Secretary would still be required to
promulgate regulations for standardized marketing requirements.
These regulations would have to meet the same requirements
mandated for the NAIC, and the Secretary would be authorized to
establish other standards as appropriate. The regulations would
take effect one year after enactment of this legislation
beginning with the first open enrollment period. Both the NAIC
and the Secretary would be required to consult with a working
group of representatives, selected in a manner that insures
balanced representation, of MA or PDP plans, consumers groups,
and other qualified individuals when developing the marketing
standards.
With regards to enforcement, the provision would require
that states report violations of these marketing requirements
to CMS. The Secretary would then be required to submit an
annual report to Congress on the enforcement of these
requirements and any recommendations as appropriate. A list of
alleged violations reported by a state, MA, or PDP plan and
their disposition must be included in the report.
The Secretary would be prohibited from establishing other
standards that would supersede state laws or regulations that
enact these marketing requirements. Finally, this provision
would preempt any provision in the Medicare statute or this
legislation from: (1) prohibiting a state from conducting a
market conduct examination, or (2) from imposing sanctions
against MA or PDP plans or their agents and brokers for
violations of these requirements. All MA and PDP plans would be
required to comply with these requirements on the date these
regulations were implemented.
Sec. 1907. NAIC recommendations on the establishment of standardized
benefit packages for Medicare Advantage plan and Medicare
prescription drug program plan
Current Law
No provision.
Proposed Law
This provision would require that the Secretary request
that the NAIC establish a committee to study and make
recommendations to the Secretary and Congress on the
establishment and regulation of standardized benefit packages
for MA and PDP plans.
Sec. 1908. Application of emergency services laws
Current Law
SSA section 1867 requires hospital emergency departments to
examine and treat any individual who comes to the hospital with
an emergency medical condition, and any woman who is in labor
(the Emergency Medical Treatment and Active Labor Act--EMTALA).
The section requires hospitals to offer treatment, within their
capacity and with the individual's consent, to stabilize the
emergency condition, or transfer the individual to another
medical facility. The section specifies restrictions on
transferring an individual to another medical facility. It also
provides for civil penalties for hospitals that do not comply
with the requirements of this section. This section may not be
construed to preempt state or local law unless it conflicts
directly with the specified requirements. In addition, the
section prohibits discrimination and delay in examining or
treating the individual with the emergency condition. It
provides protections to whistleblowers who report violations of
the requirements of this section.
Proposed Law
The provision states that this Act would not relieve health
care providers of requirements to provide emergency services
required by EMTALA or other relevant state or federal laws.
Sec. 1909. Nationwide program for national and State background checks
on direct patient access employees of long-term care facilities
and providers
Current Law
Section 307 of the Medicare Prescription Drug, Improvement,
and Modernization Act (MMA) of 2003 (P.L. 108-173) established
the framework for a program to evaluate national and state
background checks on prospective employees who have direct
access to patients of long-term care facilities or providers.
According to CMS, the program's purpose was to identify
efficient, effective, and economical procedures for conducting
background checks. A pilot program was administered by CMS, in
consultation with the Department of Justice (DoJ). The pilot
program operated from January 2005 through September 2007 in
seven States (Alaska, Idaho, Illinois, Michigan, Nevada, New
Mexico, and Wisconsin) selected by CMS to participate in the
Background Check Pilot Program.
Proposed Law
The provision would require the Secretary to establish a
nationwide program for national and State background checks on
direct patient access employees of certain long-term care (LTC)
facilities or providers and provide federal matching funds to
states to conduct these activities. Except for certain
modifications described below, the Secretary would be required
to carry out the nationwide program under similar terms and
conditions as the Background Check Pilot program under MMA
section 307, as specified. The Committee intends that the
Secretary make relevant changes to the provisions based upon
lessons learned from the MMA pilot program and that are
reflected in the legislative language. Under the nationwide
program, the Secretary would be required to enter into
agreements with newly participating states, as specified, and
certain previously participating states, as specified.
According to the procedures established under the pilot
program, certain LTC providers would be required to obtain
state and national criminal history and other background checks
on their prospective employees through such means as the
Secretary determines appropriate. To conduct these checks,
states would utilize a search of state-based abuse and neglect
registries and specified state and federal databases and
records, including a fingerprint check. States would also be
required to describe and test methods that reduce duplicative
fingerprinting, including the development of a ``rap back''
capability, as specified. The Committee intends that the
Secretary implement this provision in a fashion that does not
result in application fees for potential long-term care
workers.
States that enter into an agreement with the Secretary
would be responsible for monitoring compliance with the
requirements of the nationwide program and have specified
procedures in place, including procedures to: (1) conduct
screening and criminal history background checks; (2) monitor
compliance by LTC facilities and providers; (3) provide for a
provisional period of employment of a direct patient access
employee, as specified; (4) provide procedures for an
independent process by which a provisional employee or an
employee may request an appeal, or dispute the accuracy of, the
information obtained in a background check, as specified; (5)
provide for the designation of a single state agency with
specified responsibilities; (6) determine which individuals are
direct patient access employees; (7) as appropriate, specify
disqualifying offenses, including convictions for violent
crimes; and (8) describe and test methods that reduce
duplicative fingerprinting, as specified.
States would be required to guarantee (directly or through
donations from public or private entities) a designated amount
of non-federal contributions to the program. The federal
government would provide a match equal to three times the
amount a state guarantees, except that federal funds would not
exceed $3 million for newly participating states and $1.5
million for previously participating states.
The term ``LTC facility or provider'' would be defined to
mean the following types of facilities or providers which
receive payment for services under Medicare or Medicaid:
skilled nursing facilities; nursing facilities; home health
agencies; hospice providers; LTC hospitals; providers of
personal care services; providers of adult day care;
residential care providers that arrange for, or directly
provide, LTC services, including certain assisted living
facilities that provide a nursing home level of care
established by the Secretary; intermediate care facilities for
the mentally retarded (ICF/MRs); and other LTC facilities or
providers of services under Medicare and/or Medicaid that the
participating State determines appropriate. The term ``direct
patient access employee'' would be defined to mean any
individual who has access to a patient or resident of a LTC
facility through employment or contract and who has duties that
involve (or may involve) one-on-one contact with a patient or
resident of a facility or provider, as determined by the state
for purposes of the nationwide program. Such term does not
include volunteers unless they have equivalent duties that
involve (or may involve) one-on-one contact with a patient or
resident of a LTC facility or provider.
The HHS Inspector General would be required to conduct an
evaluation of the nationwide program and submit a report to
Congress no later than 180 days after completion of the
national program. The Secretary of the Treasury would be
required to transfer to HHS an amount specified by the HHS
Secretary as necessary (not to exceed $160 million) to carry
out the nationwide program for fiscal years 2010 through 2012.
Such amounts would be required to remain available until
expended.
Sec. 1910. Establishment of Center for Medicare and Medicaid Payment
Innovation (CMPI) within CMS
Current Law
Medicare undertakes research to study test new approaches
to paying providers, delivering health care services, or
providing benefits to Medicare beneficiaries. In accordance
with Medicare's demonstration authority (Section 402 of the
Social Security Amendments of 1967), demonstration projects are
required to determine whether or not changes in reimbursement
would increase the efficiency and economy of health care
services without adversely affecting quality. Demonstrations,
which typically run from 1 to 5 years, are conducted in select
geographic regions and with certain subgroups of beneficiaries.
CMS requires that all demonstrations be evaluated. If
successful, administrative or payment changes may be
implemented nationwide across the Medicare program. For
example, results from various demonstration studies helped
facilitate the adoption of the inpatient prospective payment
system (IPPS) and Medicare managed care. Although
demonstrations may be initiated by both the agency and
Congress, the number of congressionally mandated demonstrations
has increased in recent years and the number of CMS-initiated
pilots has declined.
Under the Medicaid program, the SSA authorizes several
waiver and demonstration authorities to provide states with the
flexibility to operate their programs outside of program rules.
Medicaid waivers allow states to experiment with different
approaches in the delivery of health care services or adapt
their programs to the special needs of particular geographic
areas or groups of Medicaid beneficiaries. The primary waiver
authorities include: Section 1115 Research and Demonstration
Projects, Section 1915(c) Home and Community-Based Services
Waivers (HCBS), Section 1915(b) Managed Care/Freedom of Choice
Waivers, and Section 1915(b)/(c) Waivers. States submit
proposals outlining proposed waiver projects to CMS for
approval before implementing these programs. In recent years,
there has been increased interest among states in waiver
programs as a means to restructure Medicaid coverage, control
costs, and increase flexibility.
Both Medicare and Medicaid demonstrations are currently
overseen by CMS's Office of Research and Development.
Proposed Law
This provision would add a new section (1115A) to the SSA
to create a Center for Medicaid and Medicaid Payment Innovation
(CMPI) within the Centers for Medicare and Medicaid Services
(CMS) to test and evaluate Medicare and Medicaid payment
models. Payment models would be selected according to their
likelihood of improving patient care and reducing program
costs.
The Director of the CMPI would report to the CMS
Administrator. Demonstrations carried out under sections 1222
and 1236 of the AAHCA of 2009 would be conducted by the CMPI in
accordance with the rules of this provision.
The Secretary would be required to give preference to
testing models that address populations for which deficits in
health care have resulted in poor clinical outcomes or
avoidable expenditures. CMS staff would determine which payment
models to test at the CMPI. If determined appropriate, the
Secretary would be authorized to gather input from outside the
Center when making decisions. The CMPI would also be required,
through open door forums or other mechanisms, to consult with
relevant federal agencies as well as experts in medicine and
health care management in carrying out its functions. The
Secretary would have the authority to waive Medicare statutory
requirements and certain Medicaid rules governing provider
payments and state plans, but only for purposes of testing of
models under this section.
Models to be tested would be expected to reduce program
costs in either or both programs and enhance the quality of
care. Unlike current Medicare and Medicaid demonstration
projects, payment models under the CMPI would not have to
demonstrate budget neutrality as a condition of participation.
However, the Secretary would be required to terminate or modify
a model if the Chief Actuary of CMS certifies that the model
does not meet one the of the three conditions: (1) improve the
quality of care without increasing spending under Medicare or
Medicaid, (2) reduce spending without decreasing the quality of
care, or (3) improve the quality of care and reduce spending.
Termination could occur at any time after the testing process
has begun. The Secretary would be required to evaluate every
payment model tested. Evaluations must include an analysis of
the quality of care delivered under the model (using patient
outcome measures) and changes in spending under Medicare and
Medicaid. All evaluation results must be made public in a
timely fashion.
The Secretary would be authorized to expand the duration
and scope of a model, which could include nationwide
implementation, if the Secretary determines that an expansion
would improve quality without increasing spending under
Medicare or Medicaid, reduce spending without decreasing
quality, or improve quality and reduce spending. In the
Medicaid program, implementation of payment models nationwide
would be required unless a state demonstrates to the
satisfaction of the Secretary that implementation would not be
administratively feasible or appropriate to the state health
care delivery system. The chief actuary of CMS would also have
to certify that such an expansion would reduce net program
spending or at least not increase program spending.
Judicial and administrative review of the selection,
design, termination, modification, or expansion of payment
models would be prohibited under this provision. This includes
any judicial or administrative review of a determination made
by either the Secretary or the Chief Actuary necessary for
expansion. Additionally, United States Code regulations related
to the Coordination of Federal Information (Chapter 35 of Title
44) would not apply to the testing, evaluation, or expansion of
payment models.
The provision would provide funding in the amount of $350
million for FY2010 from the Medicare Part B Trust Fund for the
design, implementation, and evaluation of payment models, as
well as for additional benefits not otherwise covered under
Title XI of the SSA. For fiscal years beyond 2010, the amount
provided would be equal to the previous year's amount increased
by the annual percentage increase in total Medicare
expenditures for the previous fiscal year. The provision would
also provide an additional $25 million, for each fiscal year
for administrative costs related to the testing of payment
models in the Medicaid program.
Beginning in 2012, and at least once every two years, the
Secretary would be required to submit to Congress a report on
the activities of the CMPI. Reports would be required to
include descriptions of the payment models being tested, models
chosen for expansion, results from evaluations, and
recommendations for legislative action to facilitate the
models' development and expansion.
DIVISION C--PUBLIC HEALTH AND WORKFORCE DEVELOPMENT EXPLANATION OF
DIVISION C
The Committee has conducted multiple hearings and
investigations about health insurance and how to get it to all
Americans. But as valuable as it is, health insurance cannot do
everything necessary to make our nation healthy. Even if other
parts of this legislation make it possible for everyone to be
insured, there will still be a major role for public health.
Moreover, there will be an ongoing need for funding for these
public health activities.
``Public health'' includes many different things:
It is working with groups and whole communities to
improve health, often more effectively than could be done
between a provider and a patient. Fluoridation of water for a
town is, for instance, vastly better than simply filling every
citizen's cavities. Exercise programs to prevent obesity are
better than having to treat diabetes among people who become
obese.
It is tailoring health insurance and health care
to prevent and diagnose disease early rather than simply
treating it in its later stages. Immunizations are always
better than outbreaks. Screening for hypertension is better
than simply waiting for strokes.
It is providing for safety-net services where the
insurance market alone fails to do so. Community health
centers, HIV-service providers, and family planning clinics
provide care to people who might not otherwise be able to find
a provider. Health professions education programs can add to
the primary care workforce when the market might produce only
specialists.
And, least glamorous but crucial, it is the
infrastructure of daily disease control and health promotion.
Closing down unsanitary restaurants is better than treating
food poisoning. Compiling and studying epidemic trends can
prevent major waves of disease.
The case might be made be clearer by analogy: No community
would be well-served if all its homeowners had fire insurance
but there were no fire departments, firefighters, fire
hydrants, smoke detectors, or indoor sprinklers. That very
well-insured town would still burn to the ground. Insurance is
necessary, but it is nowhere near sufficient.
The Committee intends to deal with both approaches, with
insurance and with public health. This requires going beyond
the investments in divisions A and B of the legislation to
provide health insurance to enact these provisions of division
C to make significant public health investments.
It would be insufficient simply to authorize future
appropriations for these activities while providing mandatory
spending for coverage initiatives. While the Committee on
Appropriations has shown ongoing and great leadership in these
public health programs, the budget allocations for that
Committee are too tight to allow significant new initiatives of
these sorts. Consequently the Committee on Energy and
Committee, working closely with the Committee on Appropriations
and the Committee on Budget, has endeavored to provide as firm
a funding and organizational base for these services as
possible--because they are essential in making insurance
efficient and productive and in making the nation healthier.
This Division of the legislation and this accompanying
report are laid out in five major parts:
Title I: Community Health Centers
Title II: Workforce
Title III: Prevention and Wellness
Title IV: Quality and Surveillance
Title V: Other Public Health Initiatives
Each deals with an essential complement to health reform.
Community health centers are a known and valuable part of
the primary care delivery system. As millions of people are
newly insured and enter the health care system, CHCs will be a
first point of call for many of them.
Moreover, as the system begins to provide basic care to the
uninsured, it is generally agreed that we have insufficient
numbers of health professionals--particularly primary care
providers, nurses, and public health workers. The Workforce
provisions are intended to help remedy this problem.
Everyone now seems to agree that the key to better
investment and quality improvement in the American health care
system lies in efforts to prevent disease and disability in the
first place and to manage them if they occur. The Prevention
and Wellness provisions outline an agenda of strategy,
research, clinical prevention, community prevention that will
move the nation to healthier lives.
The Quality and Surveillance sections establish a Center
for Quality Improvement and an Assistant Secretary for Health
Information. The former is to identify, develop, evaluate, and
disseminate best practices in health care throughout the
nation. The latter is to coordinate, develop, and disseminate
the wealth of data that will become available as both new
initiatives in health information technology and health reform
come to be.
Other Public Health Initiatives contains a variety of
activities, ranging from drug-pricing initiatives to school-
based health clinics. Each of these deals with incremental
improvements or corrections, and each plays a part in the
overall goals of health reform.
Sec. 2001. Table of contents; references
Current Law
No comparable provisions.
Proposed Law
Following the table of contents for Division C, this
provision states that all amendments made in such division are
to the Public Health Service Act (PHSA).
Sec. 2002. Public Health Investment Fund
Current Law
No comparable provisions.
Proposed Law
This provision would establish a Public Health Investment
Fund, into which the following amounts would be deposited from
general revenues of the Treasury:
$4.6 billion for FY2010
$5.6 billion for FY2011
$6.9 billion for FY2012
$7.8 billion for FY2013
$9.0 billion for FY2014
Amounts in the Fund would be authorized to be appropriated
for carrying out various designated provisions in Division C,
and would be in addition to any other amounts authorized to be
appropriated for such purposes.
Amounts in the Fund could be authorized to be appropriated
only if the following two conditions were met, regarding
baseline funding: (1) appropriations for a given fiscal year
are no less than the amounts appropriated in FY2008 for (i) the
Agency for Healthcare Research and Quality (AHRQ); (ii) the
National Center for Health Statistics; (iii) the National
Health Service Corps (NHSC), including the scholarship and loan
repayment programs; (iv) community health centers; and (v)
various designated workforce programs under PHSA titles VII and
VIII; and (2) the amount appropriated to the Prevention and
Wellness Trust (as would be established in sec. 3111 of this
legislation) for a given fiscal year is no less than the
specified amount appropriated to the Prevention and Wellness
Fund under the American Recovery and Reinvestment Act (P.L.
111-5) and allocated for evidence-based prevention and wellness
programs (i.e., $650 million).
The Committee anticipates working with the Committee on
Budget to draft language agreeable to both Committees to assure
that amounts deposited in the Investment Fund by this
legislation will be included in the budget score for such
legislation, and that any amounts appropriated under this
section in any future year, and associated outlays, would not
count toward the allocations for the Committee on
Appropriations under future budget resolutions.
Title I--Community Health Centers
Real health reform involves not only an expansion of health
insurance coverage, but also access to high-quality care for
patients and communities in need.
The community health centers (CHCs) program has long met
this need. Currently, CHCs serve 19 million people in some
7,000 centers across the United States.
CHCs offer comprehensive primary and preventive care to
all, regardless of ability to pay. Numerous studies have
documented the quality of the care provided by the centers as
well as their innovative service delivery mechanisms. As a
result, CHCs are often credited with improving health outcomes
as well as reducing, or in some cases even eliminating, health
disparities.
The centers have also been demonstrated to produce
significant healthcare cost savings. A 2009 study out of The
George Washington University School of Public Health (Using
Primary Care to Bend the Curve: Estimating the Impact of a
Health Center Expansion on Health Care Costs) indicates that
expenditures for health center users in 2006 were approximately
47.9% lower than for non-users. This study also shows that a
significant expansion in the number of patients served by
health centers could yield a potential savings for the nation's
health care system of $212 billion over 10 years, with $59
billion of that amount attributable to federal Medicaid
savings.
Title I is intended to build on the extraordinary work of
the CHC program and, in turn, to help lay the groundwork for
many of the health reforms provided for in other divisions of
this legislation.
Sec. 2101. Increased funding
Current Law
PHSA sec. 330 provides for the general authority for the
federal community health centers program. Subsection (r) of
that section authorizes appropriations for such program through
FY2012.
Proposed Law
This provision would amend PHSA sec. 330(r) to reauthorize
the community health centers program through FY2014, and to
authorize to be appropriated such sums as may be necessary for
FY2013 and FY2014.
The provision also would authorize to be appropriated from
the Public Health Investment Fund (as would be established in
sec. 2002 of the legislation) the following amounts:
$1 billion for FY2010
$1.5 billion for FY2011
$2.5 billion for FY2012
$3 billion for FY2013
$4 billion for FY2014
These sums from the Fund are in addition to any other
amounts authorized to be appropriated from general revenues for
such purposes.
The Committee has taken this action to ensure immediate
access to quality health care services to those most in need.
It is estimated that with the increased funding provided
through the legislation, the number of poor, low-income, and
uninsured people served by these centers could double. Such
access is critically important as the nation begins to
implement the health insurance reform measures of the
legislation (Divisions A and B), but that will not be in full
effect until 2013.
Title II--Workforce
Improvements in healthcare coverage do not automatically
translate into access to healthcare services (especially
primary care services), or produce a healthier nation. To
achieve these twin goals, there must be a sufficient and
quality health workforce in place. Experts agree: The United
States does not meet this standard.
The American Association of Medical Colleges estimates that
the nation now faces a shortage of some 11,000 primary care
providers. The nursing problem is even greater: The U.S. Bureau
of Labor reported in 2007 that the country's nursing shortage
will grow to more than one million new and replacement nurses
by the year 2016. And public health workers--whose numbers have
never been at adequate levels--fare no better. The Association
of Schools of Public Health estimates that more than 250,000
public health professionals will be needed by 2020. Expansions
in health care coverage will undoubtedly strain this already
stressed health workforce.
Better numbers alone, however, will not solve this problem
completely. A sufficient and quality workforce must also be one
that is diversified and trained to meet the needs of the U.S.
population in the 21st century.
The provisions of title II are designed to address these
and other related health workforce issues. As well, they are
expected to have both an immediate and long-term impact on
enhancing the nation's health workforce--on the one hand,
building capacity in anticipation of full implementation of the
health reforms established in other divisions of the
legislation and, in years ahead, sustaining that capacity such
that the health care needs of all Americans can be met.
Subtitle A--Primary Care Workforce
Part 1--National Health Service Corps
Sec. 2201. National Health Service Corps
Current Law
PHSA sections 331, 338A, 338B, and 338I authorize various
aspects of the National Health Service Corps (NHSC). The NHSC
supports scholarship and loan repayment programs for medical
school students, nurse practitioners, nurse midwives, physician
assistants, dental school students, and allied health
professionals who, in return, agree to a period of service as a
primary care provider in a federally-designated health
professional shortage area (HPSA). NHSC clinicians may fulfill
their service commitments in health centers, rural health
clinics, public or nonprofit medical facilities, federal or
state correctional facilities, or within other community-based
systems of care.
PHSA sec. 331(i) authorizes the Secretary to carry out
demonstration projects through which waivers may be granted to
individuals fulfilling service obligations under the NHSC Loan
Repayment Program, allowing them to fulfill this obligation
through work that is not full time. The sec. also provides the
criteria to be met to qualify for such a waiver, including
requirements that the Corps member agree: (1) to extend the
service obligation in exchange for a waiver; and (2) that the
part-time service provided by the Corps member not be less than
16 hours of clinical service per week.
PHSA sec. 337 establishes the National Advisory Council on
the NHSC to advise the Secretary. Under PHSA sec. 337(b),
members of the Council are appointed to non-renewable three-
year terms.
PHSA sec. 338B authorizes the Secretary to make payments of
up to $35,000 for the undergraduate and graduate loans of
individuals in exchange for each year of obligated service.
PHSA sec. 338C provides authority for various
administrative aspects related to periods of obligated service.
Subsection (a) of that sec. requires individuals to meet their
service obligation by providing clinical services in their
medical specialty.
Proposed Law
This provision would amend PHSA sec. 331(i) to allow the
Secretary to grant waivers permitting individuals to satisfy
either part or all of their NHSC scholarship or loan repayment
service obligation through clinical practice that is half time.
To receive such a waiver, an individual must agree to double
the period of obligated service that would otherwise be
required (in the case of an NHSC scholarship recipient), or
accept 50% of the amount that would otherwise be provided for
full-time service for a period of obligated service of two
years (in the case of a NHSC loan repayment recipient). The
provision would also make technical amendments throughout PHSA
sec. 331(i) to conform to the new half-time option, and would
define the terms ``half-time'' and ``full-time.''
The provision would amend PHSA sec. 337(b)(1) to delete
language that prohibits the reappointment of members to the
NHSC National Advisory Council.
The provision would amend PHSA sec. 338B(g)(2)(A) to
increase the maximum annual loan repayment amount available to
participating individuals, in exchange for each year of
obligated service. The amount would be set at $50,000 per year
through FY2011, which the Secretary would adjust for each
subsequent fiscal year to reflect inflation. The Committee
notes that the amount of the loan repayment benefit has not
been adjusted since 1990. The increased amount provided under
this provision--including the requirement for an annual
inflation adjustment--is necessary to ensure that the NHSC is
able to attract both a sufficient number and a highly qualified
pool of participants.
The provision would also amend subsection (a) of PHSA sec.
338C to permit the Secretary to count teaching as clinical
practice for up to 20% of a period of obligated service. The
Committee intends that such teaching take place primarily in
the ambulatory setting, where NHSC personnel are ideally
located to train the next generation of primary care providers.
In making these improvements to the NHSC, the Committee
also notes the important contribution the Corps continues to
make in addressing the health care needs of those people living
in underserved communities. Today, approximately 3,600 primary
care providers are serving in the Corps, providing services to
almost 3.8 million individuals.
But as this vulnerable population grows older, there is an
increasing need and demand for services provided by geriatric
health professionals as is the case throughout the nation's
health care system. The Committee is supportive, then, of the
recent decision by the Corps to include geriatric health
professionals among those eligible for participation in either
the scholarship or loan repayment program in all qualifying
disciplines, including mental and behavioral health. Indeed,
the Committee would encourage the Health Resources and Services
Administration (HRSA) to take all appropriate steps to inform
potential NHSC applicants about these new Corps opportunities.
Sec. 2202. Authorization of appropriations
Current Law
PHSA sec. 338(a) provides for an authorization of
appropriations to carry out the NHSC program for each fiscal
year through FY2012. PHSA sec. 338H(a) provides for an
authorization of appropriations to support the NHSC scholarship
and loan repayment programs for each fiscal year through
FY2012.
Proposed Law
This provision would amend PHSA sec. 338 to authorize to be
appropriated ``such sums as may be necessary'' for each of
FY2010 through FY2014.
The provision would also amend PHSA sec. 338 to add a new
subsection at the end to authorize to be appropriated the
following sums from the Public Health Investment Fund (as would
be established in sec. 2002 of the legislation):
$63 million for FY2010
$66 million for FY2011
$70 million for FY2012
$73 million for FY2013
$77 million for FY2014.
These sums from the Fund are in addition to any other
amounts authorized to be appropriated from general revenues for
such purposes.
Funds made available through PHSA sec. 338 are intended for
use in support of NHSC field placement activities, including
travel and transportation costs of NHSC assignees and training
and education.
In addition, this provision would amend PHSA sec. 338H to
authorize to be appropriated ``such sums as may be necessary''
for the NHSC scholarship and loan repayment programs for each
of FY2013 and FY2014.
The provision would also authorize the following sums to be
appropriated from the Public Health Investment Fund (as would
be established in sec. 2002 of this legislation):
$254 million for FY2010
$266 million for FY2011
$278 million for FY2012
$292 million for FY2013
$306 million for FY2014
These sums from the Fund are in addition to any other
amounts authorized to be appropriated from general revenues for
such purposes. Funds made available through PHSA sec. 338H are
intended for use for NHSC recruitment activities, including
scholarship awards and loan repayment.
These increases in authorization levels are consistent with
the action taken by the Congress under the American Recovery
and Reinvestment Act of 2009 (P.L. 111-5). Under that law, HRSA
was provided with sufficient resources to double the number of
health professionals participating in the NHSC--to some 8,000
individuals--over the next two years, ensuring that HRSA's
targeted field strength could be met. The funding increases
provided under this provision will allow HRSA to sustain this
doubling effort, an initiative that is especially important to
ensure that there is an adequate supply of primary care
professionals available to make access to health services a
reality under the health insurance reform improvements made
under other parts of this legislation (Divisions A and B).
Part 2--Promotion of Primary Care and Dentistry
Sec. 2211. Frontline health providers
Current Law
PHSA sections 331, 338A, 338B, and 338I authorize the NHSC.
The NHSC supports scholarship and loan repayment programs for
medical school students, nurse practitioners, nurse midwives,
physician assistants, dental school students, and allied health
professionals who, in return, agree to a period of service as a
primary care provider in a federally designated health
professional shortage area (HPSA).
PHSA sec. 332 authorizes HPSA designation by the Secretary
and includes provisions related to the NHSC. Under this
section, the Secretary may designate an area an HSPA on the
basis of a: (1) rational delivery area for health services; (2)
population group; or (3) type of health facility. All federally
qualified health centers and all rural health clinics are
deemed to be designated as HPSAs.
These efforts are focused exclusively on primary care
providers--in the case of the Corps, only primary care
providers can participate; in the case of HPSA designation,
only the availability of primary care providers is measured. In
each instance, the breadth and depth of the need for health
services in an area is not necessarily captured. Indeed, there
are many communities in which the need for medical specialists
is even more significant than the call for primary care
providers.
Proposed Law
This provision would amend PHSA title III (General Powers
and Duties of Public Health Service) to add at the end a new
subpart XI--``Health Professional Needs Areas''--and to
establish in such subpart a new Frontline Health Provider
Program. The new program would be modeled on the NHSC loan
repayment program and is designed to complement that program.
(The NHSC scholarship program intentionally was not replicated.
This action was taken by the Committee to eliminate any
potential competition for qualified applicants between the NHSC
and the new Frontline Health Provider Program.)
The purpose of the program is twofold: (1) to create
incentives to attract health care professionals to provide
health services in areas which do not meet the threshold
requirements of a HPSA (as specified in PHSA sec. 332), but
which, nonetheless, are in great need of such services; and (2)
to attract into service those health care professionals for
whom scholarship and loan repayment programs have not
previously been available. Among such providers are general
surgeons and certain pediatric subspecialists such as pediatric
rheumatologists whose services are now in great demand.
This provision would create new PHSA sections, including:
Sec. 340H. In General. In this section, the Secretary would
be required to establish a Frontline Health Providers loan
repayment program, to address unmet health care needs in health
professional needs areas under sec. 340I (below).
The Secretary would be authorized to designate an area, a
population or a facility as a ``health professional needs
area.'' To qualify as such, the following criteria would have
to be met:
In the case of an area, the area must be a
rational area for the delivery of health services
The area, population, or facility must have
an insufficient capacity of health professionals, or
high needs for health services, including services to
address health disparities
With respect to the delivery of primary
health services, the area, population, or facility must
not include a HPSA (as designated under PHSA sec. 332),
except where the need for such services is not being
met
In evaluating an area, population, or facility for
potential HPSA designation, the Secretary would be guided by
the criteria currently being used by HRSA for measuring
``insufficient capacity'' and ``high needs.'' While some
variation will be necessary, it is the intent of the Committee
that these terms have consistent conceptual meaning across
various HRSA-administered programs.
It is also the Committee's intent that HPSAs be made
eligible for the placement of Frontline Health Providers.
Today, there are many HPSAs whose health care needs are not
fully met despite the availability of NHSC personnel in their
area. And some HPSAs do not get NHSC placement at all. The
Committee anticipates that this problem will continue even with
the NHSC expansion authorized in this legislation. Thus,
regardless of their NHSC status, HPSAs that can meet the test
for unmet health care needs should be eligible to have NHSC
personnel serve in their area.
Eligibility for participation would be based upon an
individual's educational status or professional expertise.
Thus, an individual must:
Hold a degree from, or be enrolled as a
full-time student in one of a number of specified
health professions schools or training programs listed
in PHSA sec. 799B; and
Be a physician, physician assistant, nurse
practitioner, clinical nurse specialist, certified
registered nurse anesthetist, certified nurse midwife,
clinical social worker, clinical psychologist,
registered dietitian or nutritional professional,
physical or occupational therapist, qualified speech-
language pathologist, qualified audiologist,
respiratory therapist, medical technologist, or
radiologic technologist.
Individuals with a degree from a school of public health
are explicitly excluded from participating in the new Frontline
Health Providers Program. Sec. 2231 of this legislation
establishes a new Public Health Service Corps under which
financial assistance (through scholarship and loan repayment
programs) is made available to both public health students and
public health professionals. To avoid any duplication of effort
such individuals are not eligible for the Frontline Health
Providers Program.
For purposes of this section, the term ``health
disparities'' would have the meaning given such term in PHSA
sec. 3171 (as would be established in sec. 2301 of this
legislation) and the term ``primary health services'' would
have the meaning given that term in PHSA sec. 331(a)(3)(D).
Sec. 340I. Loan Repayments. In this sec. the Secretary
would be required to enter into contracts for loan repayment
with health professionals who agree:
To serve as a full-time primary health
services provider or as a full-time or part-time
provider of other health services for a minimum of two
years;
To serve in a health professional needs area
as designated under PHSA Sec. 340H (as would be
established in this provision); and
For individuals completing their health
profession studies and who have accepted employment as
a health services provider, to satisfactorily complete
their education or training
For individuals who qualify for loan repayment, the
Secretary would be required to pay, for each year of obligated
service, an amount on the principal and interest of the
individual's undergraduate or graduate educational loans (or
both) that is not greater than 50% of the average award made
under the NHSC loan repayment program in that year. Individuals
could satisfy their service requirement through employment in a
solo or group practice, a clinic, an accredited public or
private nonprofit hospital, or any other health care entity, as
deemed appropriate by the Secretary.
In keeping with the Committee's intention that HRSA look to
the NHSC loan repayment program as the model in developing the
new Frontline Health Providers Program, the provisions related
to that program (PHSA sec. 338B) would be made applicable to
the new program, except to extent they are inconsistent with
the relevant provisions of this legislation. The Committee
makes special note of one such difference. Under current NHSC
law, the Secretary is not required to redirect any unobligated
Corps funds to support other public health workforce
activities; instead, they are automatically returned to the
Treasury. To ensure that funds appropriated in any given year
for public health workforce purposes are, in fact, used for
those functions, the Secretary would be required to transfer
any unobligated Frontline Health Providers loan repayment funds
to the NHSC. The Corps, in turn, would be expected to use such
funds ensure a sufficient number of Corps participants in the
following fiscal year.
Sec. 340J. Reports. This section would require the
Secretary to submit an annual report to Congress on the
Frontline Health Providers Program.
Sec. 340K. Allocation. This section would require the
Secretary to allocate each fiscal year, 90% of any obligated
funds for loan repayments made to physicians and other health
professionals who provide primary health services; the
remaining 10% would be available for health professionals who
provide other health services.
This allocation requirement is consistent with the
Committee's focus on providing targeted support for programs
designed to help address the nationwide shortage of primary
health service providers. It recognizes, however, the lack of
sufficient health care providers in other specialties or
disciplines in some areas. Thus, the Committee expects the
Secretary, in making her annual 10% distribution each year, to
assess which health professionals are in the greatest demand,
taking into account state and local health workforce needs.
Sec. 2212. Primary care student loan funds
Current Law
No comparable provisions.
Part A, Subpart II of Part A of PHSA title VII (Health
Professions Education) establishes federally-supported student
loan funds for specified health professions. PHSA sec. 735
establishes general provisions for these loans, which do not
include provisions regarding personal or family financial
information.
Proposed Law
This provision would amend PHSA sec. 735 by adding a new
subsection (f). Under this subsection the Secretary would be
authorized either to require (or to authorize a school or other
entity to require) applicants for student loans to submit
financial information for the purpose of determining the
financial resources available to them to support their
education as a primary care physician and, in turn, their
eligibility for a student loan. In determining whether to
require such information regarding an individual's family
members, the Secretary would be required to take into account
the extent to which the individual is financially independent
from his or her family.
The provision would also require the Secretary to strike
the second sentence of 42 CFR 57.206(b). This regulation,
issued in 1979, establishes certain requirements and guidelines
related to loan programs for all health profession students
under PHSA title VII. Among these requirements is one that
states the Secretary must take into account the financial
resources of the ``family members'' of an applicant for a title
VII student loan.
While this requirement may have been justified at some
time, it has become apparent to the Committee that it is being
misused in some instances, particularly with respect to medical
students. With a significant percentage of such students
spending time in the workforce before entering medical school--
on their own--rising, the Committee believes it is appropriate
to revisit this requirement. In so doing, the Committee has
specifically eliminated the sentence in current regulations
that requires a review of financial information of the family
members of a student loan applicant. It is requiring instead
that the Secretary issue new student loan regulations that are
consistent with the provisions of this section. More
specifically, the Committee is requiring that such regulations
take into account the extent to which a loan applicant is
financially independent of his or her family. If in fact an
applicant is financially independent of her or his family, the
submission of financial information of family members should
not be required as part of the student loan application
process; only the financial information of the individual
applicant is relevant and should be considered.
Sec. 2213. Training in family medicine, general internal medicine,
general pediatrics, geriatrics, and physician assistants
Current Law
Part C of PHSA title VII (Health Professions Education)
establishes training programs in family medicine, general
internal medicine, general pediatrics, physician assistants,
general dentistry, and pediatric dentistry that includes
financial assistance for both trainees and physicians
participating in such programs. Under subsections (a) through
(d) of PHSA sec. 747, the Secretary may establish a program of
grants and contracts for hospitals, medical and osteopathic
schools, and other nonprofit entities for health professions
training programs in family medicine, general internal
medicine, or general pediatrics, and comparable programs in
dentistry.
Subsection (e) of PHSA Sec. 747 authorizes appropriations
for such program and requires the Secretary to use a specified
allocation formula when making grants and contracts. The
authorization of appropriations for the program expired at the
end of FY2002.
Proposed Law
This provision would amend PHSA Sec. 747 to redesignate
subsection (e) as subsection (f), and to strike subsections (a)
through (d) and in essence, to replace them with following new
section:
Sec. 747. Primary Care Training and Enhancement. This
section is revised to require the Secretary to establish a
program of grants and contracts for both primary care training
programs and primary care capacity building activities at
academic institutions.
With respect to primary care training programs, accredited
schools of medicine or osteopathic medicine, accredited
physician assistant training programs, accredited public or
non-profit hospitals and public or private nonprofit entities
(or a consortia of such programs or entities) would be eligible
for awards to engage in a variety of specified activities in
support of professional training in various specialties of
primary care, including family medicine, general internal
medicine, general pediatrics, or geriatrics as well as
physician assistant education. Such activities include
traineeships, fellowships and faculty development.
With respect to primary care capacity building activities,
accredited schools of medicine or osteopathic medicine would be
eligible for awards to support academic units or programs that
improve clinical teaching in various specialties of primary
care, including family medicine, general internal medicine,
general pediatrics, or geriatrics.
For both the primary care training and capacity building
awards, the Secretary would be required to give preference to
applicants with a demonstrated record of one or more of the
following activities:
Training primary care providers
Training individuals from underrepresented
minority groups or disadvantaged backgrounds
Training individuals who provide care in
underserved areas or to populations experiencing health
disparities including those eligible for Medicaid and
the Children's Health Insurance Program
Supporting teaching programs targeting
vulnerable populations
In evaluating an applicant's record regarding the training
of individuals who provide care to populations experiencing
health disparities, this provision would require that the term
``health disparities'' have the meaning given that term in PHSA
sec. 3171 (as would be established in sec. 2301 of this
legislation). In evaluating an applicant's record regarding its
teaching programs that target vulnerable populations, the
Committee intends to include among those groups, individuals
who are homeless or living with HIV/AIDS as well as other high-
risk people.
The Secretary would be required to submit an annual report
to Congress on the program.
Sec. 2214. Training of medical residents in community-based settings
Current Law
No comparable provisions.
Proposed Law
The provision would redesignate PHSA sec. 748 as PHSA sec.
749A and insert the following new sec. after PHSA sec. 747:
Sec. 748. Training of Medical Residents in Community-Based
Settings. This new sec. would require the Secretary to
establish a program of grants and contracts for various
activities related to the training of medical residents in
community-based settings, including planning and developing new
primary care residency training programs (new programs), and
operating or participating in an established primary care
residency training program (established programs). Entities
eligible for support include those (1) designated as a
recipient of Medicare graduate medical education (GME) payments
under Sec. 1886(k) of the Social Security Act (e.g., non-
hospital health providers such as clinics or community health
centers); (2) designated as an approved teaching health center
in the GME demonstration project required under Sec. 1502(d) of
this legislation; or (3) which have applied for designation
under the programs specified in (1) or (2) and have
demonstrated appropriate involvement of an accredited teaching
hospital to carry out the inpatient responsibilities associated
with a primary care residency training program.
With respect to both new and established programs, the
Secretary would be required to give preference to applicants
that (1) support teaching programs that address the health care
needs of vulnerable populations, or (2) are a federally
qualified health center (as defined or a rural health clinic as
those centers are defined respectively under SSA secs.
1861(aa)(4) and 1861(aa)(2). With respect to established
programs, the Secretary would be further required to give
preference to applicants with a demonstrated record in training
health professionals who provide primary care; individuals who
are from underrepresented minority groups or disadvantaged
backgrounds; or individuals who practice in settings with the
principal focus of serving underserved areas or populations
experiencing health disparities.
In evaluating an applicant's record regarding its teaching
programs that address the health care needs of vulnerable
populations, the Committee intends to include among those
groups individuals who are homeless or living with HIV/AIDS as
well as other high-risk people. In evaluating an applicant's
record regarding the training of individuals who practice in
settings with the principal focus of serving populations
experiencing health disparities, this provision would require
that the term ``health disparities'' have the meaning given
that term in PHSA sec. 3171 (as would be established in sec.
2301 of this legislation).
Grant or contract award periods would vary, depending upon
the type of grant or contact being sought. Grants or contracts
for new programs could not exceed three years; grants or
contracts for established programs could not exceed five years.
Moreover, grants for new programs could not be renewed,
although an entity receiving support for a new program would
remain eligible for support as an established program provided
that the two funding periods do not overlap. The Committee has
taken this approach to help ensure the establishment and
ongoing operation of as many community-based primary care
residency programs as possible.
The Secretary would be required to submit an annual report
on the programs carried out under this provision.
For purposes of this sec., the term ``primary care
resident'' has the meaning given such term in SSA sec.
1886(h)(5)(H). The term ``primary care residency training
program'' would mean an approved medical residency program
training program described in SSA sec. 1886(h)(5)(A) for
primary care residents that in case of new programs, is
actively applying for accreditation by the appropriate
accrediting body, or in the case of established programs, has
been accredited by the appropriate accrediting body.
The Committee has established this program as part of its
overall goal in title II to support professional education
efforts designed to train those who provide primary care.
Currently, the vast majority of GME training takes place in the
hospital setting; only a tiny number of non-hospital providers
have been designated as GME training facilities, despite
widespread agreement that more such training should take place
in the ambulatory setting--the practice setting for most
clinical care. The Committee expects that with this program in
place, additional GME training will take place in the
outpatient setting, including the new demonstration project for
teaching centers (as would be established in sec. 1502 of this
legislation).
Sec. 2215. Training for general, pediatric, and public health dentists
and dental hygienists
Current Law
Part C of PHSA title VII (Health Professions Education)
establishes training programs in family medicine, general
internal medicine, general pediatrics, physician assistants,
general dentistry, and pediatric dentistry that includes
financial assistance for both trainees and physicians
participating in such programs. Under subsections (a) through
(d) of PHSA sec. 747, the Secretary may establish a program of
grants and contracts for hospitals, medical and osteopathic
schools, and other nonprofit entities for health professions
training programs in family medicine, general internal
medicine, or general pediatrics, and comparable programs in
dentistry.
Subsection (e) of PHSA sec. 747 authorizes appropriations
for such program and requires the Secretary to use a specified
allocation formula when making grants and contracts. The
authorization of appropriations for the program expired at the
end of FY2002.
PHSA sec. 791 sets forth criteria the Secretary is required
to use in making grant or contract awards for programs
authorized under PHSA sec. 747 and sec. 750. Such criteria
include giving preference to applicants that have a high or
recently improved rate of placing program graduates in practice
settings that provide care to medically underserved
communities.
Proposed Law
This provision would amend part C of PHSA title VII (Health
Professions Education) to add at the end a new PHSA sec. 749:
Sec. 749. Training for General, Pediatric, and Public
Health Dentists and Dental Hygienists. This new sec. would
require the Secretary to establish a program of grants and
contracts to establish and maintain training programs for oral
health professionals, including such individuals practicing in
general dentistry, public health dentistry or dental hygiene.
Entities eligible to participate in such a program include: (1)
accredited schools of dentistry; (2) training programs in
dental hygiene (located in either an accredited school of
dentistry or an accredited institution of higher education; (3)
public or private nonprofit entities; or (4) consortia of such
entities. Such entities could receive support for various
professional training-related activities, including
scholarships, loan repayments, traineeships, fellowships, and
faculty development.
With respect to loan repayments for full-time dental
faculty, the Committee underscores the sec.'s focus on
targeting such faculty who participate in programs of general,
pediatric or public health dentistry. This view is consistent
with the overall purpose of subtitle A to increase the number
of primary care health professionals--including oral health
professionals--across the country. In addition, in developing
the loan repayment program under this sec., the Committee
encourages the Secretary to be guided by the loan repayment
process used in administering either the nurse faculty loan
repayment program authorized in PHSA 846A or the loan repayment
program for disadvantaged students authorized in PHSA sec. 738.
In awarding grants or contracts, the Secretary would be
required to give preference to applicants with a demonstrated
record of one or more of the following activities:
Training oral health professionals who
practice general, pediatric, or public health dentistry
Training individuals from underrepresented
minority groups or disadvantaged backgrounds
Training individuals who practice in
underserved areas or provide services to populations
experiencing health disparities including those
eligible for Medicaid and the Children's Health
Insurance Program, or those with special health care
needs
Supporting teaching programs targeting
vulnerable populations
Providing instruction regarding the oral
health status, dental health needs, and clinical oral
disease management of children, especially underserved
children
In evaluating an applicant's record regarding the training
of individuals who provide services to populations experiencing
health disparities, this provision would require that the term
``health disparities'' have the meaning given that term in PHSA
sec. 3171 (as would be established in sec. 2301 of this
legislation). In evaluating an applicant's record regarding its
training programs that target vulnerable populations, the
Committee intends to include among those groups, individuals
who are homeless or living with HIV/AIDS as well as other high-
risk people.
The Secretary would be required to submit an annual report
to Congress on the program.
Sec. 2216. Authorization of appropriations
Current Law
PHSA title VII (Health Professions Education) includes the
authorization of appropriations for a number of training
programs. Many of these authorizations have expired.
Proposed Law
This provision amends Part F of PHSA title VII (Health
Professions Education) to add the following new sec. 799C:
Sec. 799C. Funding through Public Health Investment Fund.
This new sec. would have the following sums authorized to be
appropriated from the Public Health Investment Fund (as would
be established in section 2002 of this legislation) for the
purpose of carrying out various programs related to the
promotion of primary care, including primary oral health care:
$240 million for FY2010
$253 million for FY2011
$265 million for FY2012
$278 million for FY2013
$292 million for FY2014
These sums from the Fund are in addition to any other
amounts authorized to be appropriated from general revenues for
such purposes.
This section would also reauthorize PHSA section 747
through FY2014.
Sec. 2217. Study on effectiveness of scholarships and loan repayments
Current Law
No comparable provisions.
Proposed Law
This provision would require GAO to conduct a study on the
effectiveness of both the National Health Service Corps and the
Frontline Health Provider Program (as would be established in
sec. 2211 of this legislation) in encouraging individuals to
pursue and maintain careers in primary care and in encouraging
them to practice in underserved areas. More specifically, the
study would evaluate the scholarships and loan repayments
attached to each of these programs to determine their
appropriateness and adequacy in helping to achieve these twin
goals.
Subtitle B--Nursing Workforce
Sec. 2221. Amendments to the Public Health Service Act
Current Law
PHSA title VIII (Nursing Workforce Development) contains
several provisions on nurse workforce development, including
programs to provide grants and loans to nursing students and
schools of nursing.
PHSA sec. 811 authorizes the Secretary to provide grants to
fund projects that support the enhancement of advanced nursing
and practice, and traineeships for individuals in advanced
nursing programs. PHSA sec. 811(f) places some limitations on
the use of these grant funds for traineeships, restricting
their use to certain education-related costs and living
expenses, and limiting the amount of support for individuals in
doctoral programs to no more than 10% of the total amount of
obligated funds. Special consideration is provided under the
sec. for entities that agree to train advanced education nurses
who will practice in health professional shortage areas
(HPSAs).
PHSA sec. 821 authorizes the Secretary to award grants to
increase nursing education opportunities for individuals from
disadvantaged backgrounds, including racial and ethnic
minorities underrepresented in the nursing profession.
PHSA sec. 831 authorizes the Secretary to award grants to
expand both nursing education and nurse practice arrangements
and to develop nurse retention programs.
PHSA sec. 836 places limits on loans made by nursing
schools authorized under PHSA sec. 835 (student loans). Such
loans may not exceed $2,500 per year, with an exception for the
final two academic years, during which they may not exceed
$4,000 per year. Regardless of the time frame involved, no
student may receive more than $13,000 in loans. The sec. also
establishes a student loan repayment program for individuals
who agree to serve as a nurse for at least two years at a
qualified health care facility with a critical shortage of
nurses.
PHSA sec. 846A authorizes the Secretary to establish
agreements with nursing schools for the development and
operation of nurse faculty loan programs. Subsection (c) of
that sec. establishes requirements for such programs, including
a limitation of $30,000 (plus an annual inflation adjustment)
on the total amount of loans that a nursing school may make to
a student through its loan program in any academic year.
PHSA sec. 845 requires the Secretary to establish the
National Advisory Committee on Nursing Education and Practice.
PHSA sec. 855 requires the Secretary to award grants for
training and education programs and initiatives in geriatric
care. These programs and initiatives are to be coordinated with
programs authorized under PHSA sec. 753 (geriatric education
and training).
Part H of PHSA title VIII requires the Secretary to develop
and issue public service announcements to advertise and promote
the nursing professions. The Secretary is also authorized to
fund state and local public service announcements for the same
purpose.
Part F of PHSA title VIII provides for the authorization of
appropriations for various nurse workforce programs through
FY2002, including Parts B, C and D (sections 811, 821, and 831
respectively) of the title.
The authorization of appropriations for six programs
authorized under title VIII has expired, although the following
programs have continued to be funded: advanced education
nursing grants (PHSA sec. 811); nursing workforce diversity
grants (PHSA sec. 821); nurse education, practice, and
retention grants (PHSA sec. 831); National Nurse Services Corps
(nurse educational loan repayment and scholarship programs)
(PHSA sec. 846); nurse faculty loan program (PHSA sec. 846A);
and comprehensive geriatric education (PHSA sec. 855).
Two PHSA title VIII programs have not received
appropriations since they were first authorized: public service
announcements (PHSA sections 851 and 852) and grants for health
professions education for cultural competency (PHSA sec. 807).
The nursing student loan program (PHSA sections 835-840), which
provides loans to nursing students to pursue studies in all
levels of nursing, has not received any funding support in
recent years. However, nursing schools are able to utilize
funds from other sources as well as loan repayments to operate
loan funds from which they award student loans.
Proposed Law
This provision would amend PHSA title VIII regarding
certain nursing grant and loan programs, and would authorize
monies from the Public Health Investment Fund (established
under sec. 2002 of this legislation) to support such programs
for FY2010 through FY2014.
Congress first authorized comprehensive federal support for
nursing workforce programs when it passed the Nurse Training
Act of 1964 (P.L. 88-581). The initial programs were created in
response to a 1963 Surgeon General's report that projected a
nursing shortage within the decade. Subsequent legislation
amended or reauthorized the title VIII programs to address
evolving needs in nursing education and training. The programs
were last reauthorized in 2002.
Thirty-five years after the passage of the 1964 Nurse
Training Act, title VIII programs continue to be a primary
source of federal funding for nursing education. Within the
context of health reform, the Committee believes that it is
time to renew the nation's commitment to these programs to
ensure an adequate and well-qualified nurse workforce. Indeed,
experts report that with an anticipated shortfall of at least
500,000 nurses by 2020, there is no time to lose.
Experts report that a major contributor to this projected
shortage is the lack of faculty to train new recruits to the
profession. According to the American Association of Colleges
of Nursing (AACN), some 42,000 qualified applicants were turned
away from nursing schools in 2006, to a significant extent as a
result of insufficient faculty. Several causes are attributed
to this capacity building problem, including the ability of
nursing schools to attract and retain faculty. Replacing the
aging nurse workforce--those out in the field--has become a
great challenge as well. The need and demand for primary care
nurses with advanced degrees has become especially acute in
light of the current shortage of primary care providers.
The purpose, then, of this provision is to reauthorize
various title VIII authorities and to provide improvements to
those particular programs designed to help increase the nurse
workforce. With such changes in place, the AACN estimates that
10,000 new nurses will be trained each year, and half of those
would hold an advanced degree. More specifically, this
provision would make the following changes:
The provision would amend PHSA sec. 801 to allow
``nurse-managed health centers'' (NMHCs) (as defined in this
provision) to be eligible for support under various programs
authorized under title VIII. The Committee understands that
under current practice, NMHCs are eligible for awards--and have
received support--under title VIII. As such, the Committee
simply intends for this provision to codify that practice to
ensure that NMHCs are able to continue to participate in title
VIII programs. This is especially important as part of the
country's push to train more nurses. Administered by nurses
with advanced degrees, NMHCs are important sites both for
nursing education and for providing access to health services,
particularly for vulnerable populations. In codifying NMHC
eligibility for title VIII support, however, the Committee also
intends for these centers to continue to operate in accordance
with applicable state law requirements regarding the scope of
practice under which an individual is legally authorized to
perform services at an NMHC. Indeed, nothing in this provision
is intended to have any impact or effect on such laws (or on
any state regulatory mechanism authorized under state law).
The provision would strike PHSA sec. 807, a grant
program for cultural and linguistic competence training for
nurses. As noted, this program has never been funded; the
Committee does not anticipate a change in this funding status.
Moreover, the Committee believes that cultural and linguistic
competence training should be coordinated across the spectrum
of health professionals rather than targeted on one or two
types of providers. Thus, the Committee has chosen not to
continue the program authorized under PHSA sec. 807 (as well as
other similar programs), but rather to take a new approach,
much broader approach in supporting diversity and cultural
competency programs. (See sections 2243 and 2251 of this
legislation).
The provision would add a new PHSA sec. 809 to
require the Secretary to submit annual reports to Congress on
all of the loan and grant programs in title VIII that do not
already require such a report (PHSA sections 811, 821, 836,
846A, and 861, as re-designated under this provision).
The provision would amend PHSA sec. 811 (regarding
the Advanced Education nursing grants) to strike the
prohibition in paragraph (f), which currently restricts the
percentage of traineeships that may be obligated to support
individuals in doctoral programs to 10%. The provision would
further amend PHSA sec. 811 to require the Secretary to give
special consideration to applicants that either intend to
expend their grant funds to train nurses with advanced degrees
who will practice in HPSAs or to increase diversity among
advanced education nurses.
The provision would amend PHSA sec. 831 to revise
one of the purposes of the nurse education, practice, and
retention grants for practice priority areas to include the
provision of coordinated care, quality care and other relevant
skills and to replace the reference to managed care and quality
improvement. The provision also strikes the outdated preference
criterion for FY2003 through FY2005.
The provision would amend PHSA sec. 836 to
increase the total maximum amount of loans a student may
receive on an annual basis from $2,500 to $3,300; to increase
the annual such limit for a student's last two academic years
from $4,000 to $5,200; and to increase the total amount of
loans a student may receive over the course of his or her
enrollment in a nursing program from $13,000 to $17,000.
Effective FY2012, the provision also would instruct the
Secretary to adjust these limits annually for inflation. In
increasing these amounts, the Committee notes that no
adjustment has been made since the program's inception in 2002.
The provision would amend PHSA sec. 846(a) to
allow individuals to be accepted into the loan repayment
program if they agree to serve for not less than two years as a
faculty member at an accredited school of nursing. This change
is intended to complement other existing incentives designed to
encourage nurses to become faculty. In addition, the revision
is intended to expand the pool of nurses already serving as
faculty who can qualify for loan repayment. Currently, the
nurse faculty loan program is available only to nurses
graduating from schools that operate loan funds. The provision
would also amend PHSA sec. 846A(c) to raise the limit on the
total amount of loan repayment any individual may receive for
any academic year under the nurse faculty program from $30,000
to $35,000. Effective FY2012, the provision would require the
Secretary to adjust these limits annually for inflation. In
increasing these amounts, the Committee notes that no such
adjustment has been made since the program's inception in 2002,
heightening the financial barriers that make it more difficult
to attract people into the profession.
The provision would strike part H of title VIII
(PHSA sections 851 and 852) to eliminate the authority to
develop and issue public service announcements to promote
careers in nursing. As noted above, Congress has never funded
this activity; the Committee has no basis for believing that
this will change. Moreover, data indicate that the current
nursing shortage is not a result of a lack of interest in the
field--some 42,000 qualified individuals were turned away from
nursing schools in 2006 alone, according to the AACN. Instead,
it is due in large measure to a lack of financial resources to
support nurse education and training, including nurse faculty
recruitment and retention. Thus, the Committee believes it is
far more prudent to invest the limited dollars available in
programs that support those activities rather than in
advertising campaigns.
The provision would authorize to be appropriated
``such sums as may be necessary'' for each fiscal year through
FY2014 for part B (advanced education grants), part C
(workforce diversity grants), and part D (nurse education,
practice, and retention grants) of title VIII.
The provision would also authorize the following
sums to be appropriated from the Public Health Investment Fund
(as would be established in sec. 2002 of this legislation) for
the purpose of carrying out various nurse workforce training
programs:
$115 million for FY2010
$122 million for FY2011
$127 million for FY2012
$134 million for FY2013
$140 million for FY2014
These sums from the Fund are in addition to any other
amounts authorized to be appropriated from general revenues for
such purposes.
In allocating funds to support nursing workforce programs,
it is the intent of the Committee that priority be given to
those programs and activities designed to (1) increase the
number of nursing faculty; (2) address other factors impeding
nursing education capacity; and (3) promote the training of
advanced education nurses who deliver primary care.
The provision would make technical and conforming
changes to various programs in title VIII
Subtitle C--Public Health Workforce
For some time, experts have argued that the public health
workforce is inadequate to meet the nation's public health
needs. To help address this problem, Congress established five
public health workforce training programs under PHSA title VII
(Health Professions Education) as part of the Health Education
Partnerships Act of 1998 (P.L. 105-392): general grant
authority (PHSA sec. 7650; public health training centers (PHSA
sec. 766); public health traineeships (PHSA sec. 767);
preventive medicine; dental public health (PHSA sec. 768), and
heath administration traineeships and special projects (PHSA
sec. 769). Programs funded in sec. 765 have gone unfunded;
programs authorized in PHSA sec. 769 have not been funded since
FY2006.
Despite these efforts, the sufficiency and quality of the
public health workforce remains of great concern. Today, the
Association of Schools of Public Health estimates that within
the next 10 years, the nation will experience a shortfall of
more than 250,000 public health workers. Approximately one-
quarter of the government's public health workforce will be
eligible to retire by 2012, including nearly 50% of state
employees who work in public health. And almost 20% of local
public health employees will be qualified for retirement by
2010, according to the National Association of County and City
Health Officials.
It is clear that state and local budget constraints are a
major barrier to adequate staffing at public health agencies.
Many prospective employees seek private sector employment
because of the higher salaries and more generous benefits
packages that are often available and that the public sector
cannot match. Similarly, few state or local health departments
have the resources to dedicate to recruiting, retaining, or
training the professional workforce necessary to protect the
public's health. This has become of increasing concern as the
nation faces a number of emerging and ongoing public health
challenges (e.g., salmonella outbreaks, H1N1 influenza, and the
HIV/AIDS epidemic) that demand the use of trained experts.
Indeed, according to CDC, the vast majority (80%) of the public
health workforce now lacks formal public health training for
their specific job functions.
The provisions in subtitle C are intended to expand the
efforts begun a decade ago. Their purpose is to improve the
programs already on the books and to create a new program
designed to encourage public health graduates to enter the
public health workforce. Taken together, these initiatives,
along with the funding made available for them, is expected to
produce a larger and better trained workforce that can help
meet the public health needs across the country.
Sec. 2231. Public Health Workforce Corps
Current Law
No comparable provisions.
Proposed Law
This provision would amend PHSA title III to add at the end
a new subpart XII--``Public Health Workforce''--and to
establish in that part a new Public Health Workforce Corps
consisting of the following three new sections:
Sec. 340L. Public Health Workforce Corps. This sec. would
require the establishment, within the U.S. Public Health
Service, of a Public Health Workforce Corps (PHWC) to ensure an
adequate national supply of public health professionals. The
new program would be modeled on the National Health Service
Corps (NHSC) that offers scholarships and loan repayments to
attract health professionals to provide services in health
professional shortage areas. Indeed, the sec. explicitly states
that the PHSA sections regarding the general administrative
aspects of the NHSC would apply to the PHWC unless they are
inconsistent with such provisions.
The PHWC would be administered by HRSA, the agency which
oversees virtually all of the federal health workforce training
programs. The CDC would, however, have responsibility for
developing a methodology for placing and assigning Corps
participants in such organizations as state, local, and tribal
health departments, and federally qualified health centers. The
Committee has specifically tasked CDC with this duty because of
both its expertise in public health and its ongoing, strong
connection with health departments.
The Corps itself would consist of: (1) officers of the
Regular and Reserve Corps of the U.S. Public Health Service
Commissioned Corps; (2) civilian U.S. employees appointed by
the Secretary; and (3) other individuals who are not employees
of the United States. The Committee anticipates that students
and graduates of accredited schools or programs of public
health will comprise the majority of the Corps.
The Secretary would be required to submit an annual report
to Congress on the PHWC.
Sec. 340M. Public Health Workforce Scholarship Program.
This sec. would require the Secretary to establish a
scholarship program for individuals who want to join PHWC. To
be eligible for scholarship assistance, an applicant must:
Be accepted or enrolled full-time or part-time in an
accredited graduate school or program of public health;
or
Have public health expertise and be accepted or
enrolled full-time or part-time in an accredited
graduate school or program of nursing; health
administration, management, or policy; preventive
medicine; laboratory science; veterinary medicine; or
dental medicine; or other accredited graduate school or
program designated by the Secretary.
It is the Committee's intent that the Secretary have
discretionary authority to extend scholarship assistance to
individuals pursuing graduate degrees in public health
disciplines at non-public health accredited schools or
programs. For example, in the Committee's view, it may be
appropriate for the Corps to provide support for individuals
enrolled in an accredited school of education that offers a
program of study in health communications or in a graduate
school of arts and sciences that offers a course of study in
biostatistics.
Scholarship awards could be made for up to four years. In
return, scholarship recipients would be required to serve full-
time as a public health professional for a period of one year
for each academic year for which the recipient was provided
scholarship support (with a maximum commitment of four years)
or two years--whichever period is greater. Stipends would be
provided on a monthly basis and would be required, effective
FY2011, to be adjusted by the Secretary on an annual basis for
inflation.
The Committee anticipates that many, or even most,
scholarship recipients will fulfill their service obligation
working at public health agencies such as state and local
health departments or community health centers. While the
Committee fully endorses the placement of Corps members at
these sites, it understands that there may be other entities
with a public health focus that may benefit from their service.
Thus, the Committee expects CDC to take a broad view in
developing an appropriate methodology for placing and assigning
Corps participants so as to include those sites experiencing
the most severe shortages of, and the most difficulty in
recruiting, public health professionals.
As noted, it is the Committee's intent that the PHWC be
administered in a manner similar to that followed with regard
to the NHSC, except to the extent that the new subpart XII
would require something different. The Committee underscores
this intent with respect to the scholarship program that would
be established in this section.
Sec. 340N. Public Health Workforce Loan Repayment Program.
This sec. would require the Secretary to establish a loan
repayment program for individuals who want to join PHWC. To be
eligible for loan repayment assistance, an applicant must:
Have a graduate degree from an accredited
school or program of public health;
Have demonstrated public health expertise
and a graduate degree from an accredited school or
program of nursing; health administration, management,
or policy; preventive medicine; laboratory science;
veterinary medicine; or dental medicine; or other
accredited graduate school or program designated by the
Secretary; or
Be enrolled in the final year of study at an
accredited school or program of public health or an
accredited school or program of nursing; health
administration, management, or policy; preventive
medicine; laboratory science; veterinary medicine; or
dental medicine; or other accredited graduate school or
program designated by the Secretary (with demonstrated
expertise in public health).
It is the Committee's intent that the Secretary have
discretionary authority to extend loan repayment assistance to
individuals pursuing or holding graduate degrees in public
health disciplines at non-public health accredited schools or
programs. For example, in the Committee's view, it may be
appropriate for the Corps to provide support for individuals
enrolled in an accredited school of education that offers a
program of study in health communications or in a graduate
school of arts and sciences that offers a course of study in
biostatistics.
In return for any assistance provided under this program,
loan recipients would be required to serve for a minimum of two
years as a public health professional in an appropriate
setting. For each year of service provided, individuals could
receive up to $35,000 in loan repayments, an amount that would
be required, effective FY2012, to be adjusted by the Secretary
on an annual basis for inflation.
The Committee anticipates that many or even most loan
recipients will fulfill their service obligation working at
public health agencies such as state and local health
departments or community health centers. While the Committee
fully endorses the placement of Corps members at these sites,
it understands that there may be other entities with a public
health focus that may benefit from their service. Thus, the
Committee expects CDC to take a broad view in developing an
appropriate methodology for placing and assigning Corps
participants so as to include those sites experiencing the most
severe shortages of, and the most difficulty in recruiting,
public health professionals.
As noted, it is the Committee's intent that the PHWC be
administered in a manner similar to that followed with regard
to the NHSC except to the extent that the new subpart XII would
require something different. The Committee underscores this
intent with respect to the loan repayment program that would be
established in this section.
Sec. 2232. Enhancing the public health workforce
Current Law
PHSA sec. 765 authorizes the Secretary to establish a
program of grants and contracts to enhance the public health
workforce, including efforts to increase the number of
individuals in such workforce, to enhance the quality of such
workforce, and to enhance the ability of such workforce to meet
the nation's public health needs.
This program has not been funded.
Proposed Law
This provision would amend PHSA sec. 765, in essence, to
replace it with the following new sec.:
Sec. 765. Enhancing the Public Health Workforce. This new
sec. would require the Secretary to establish a program of
grants and contracts to enhance the public health workforce.
Entities eligible to participate in such programs include (1)
various health professions schools; (2) state, local or tribal
health departments; (3) public or private nonprofit
organizations; and (4) consortia of these entities. Such
entities could receive support for various public health
professional training-related activities, including
traineeships and fellowships.
In awarding grants or contracts, the Secretary would be
required to give preference to applicants with a demonstrated
record of one or more of the following activities:
Training public health professionals who
serve in underserved communities
Training individuals from underrepresented
minority groups or disadvantaged backgrounds
Training individuals who practice in public
health specialties experiencing a significant shortage
of public health professionals
Training public health professionals who
serve in the federal government or state, local, or
tribal governments
The Secretary would be required to submit an annual report
to Congress on the program. In evaluating an applicant's record
regarding the training of individuals who practice in public
health specialties experiencing a significant shortage of
public health professionals, the Committee expects the
Secretary to take into account various public health workforce
needs. For example, across the country, there is increasing
demand for (and shortage of) public health professionals with
expertise in nursing, epidemiology and health education, among
others specialties. Entities providing training in these areas
would be given preferential treatment in evaluating their
application for support under this program. However, once these
shortages are adequately addressed, this preferential treatment
would no longer apply; the emphasis instead would be placed on
those public health specialties then experiencing a shortage of
public health professionals.
The Committee notes its interest in this program's focus on
supporting training activities on mid-career public health
professionals. As noted, some 80% of today's state and local
public health workforce has not received formal training in
their areas of responsibility. Many of them are at the mid-
career level. This program would afford them the opportunity to
build on the expertise they have developed through their work
experience and in turn, to bring new public health knowledge
back into the communities and organizations in which they
serve.
The Committee further notes its intent that the Secretary
administer this program in a manner that best integrates its
activities with other existing public health workforce
programs, including the public health training centers program
(PHSA sec. 766) and the public health traineeships program
(PHSA sec. 767). In so doing, however, it underscores the
requirement that the HRSA Administrator consult with the CDC
Director in establishing the PHSA sec. 765 public health
workforce program.
Sec. 2233. Public health training centers
Current Law
PHSA sec. 766 authorizes the Secretary to establish a
program of grants and contracts to support public health
training centers. Subsection (b)(1) of that section refers to
``goals established by the Secretary for the year 2000.'' This
clause refers to the decennial Healthy People goals developed
and published by the Secretary.
Proposed Law
This provision would amend subsection (b)(1) of PHSA sec.
766 to strike the reference to the HHS Healthy People
publication and to replace it with a reference to the HHS
prevention and wellness goals that would be developed by the
Secretary under PHSA sec. 3121 (as would be established in sec.
2301 of this legislation). PHSA sec. 3121 requires the
Secretary to prepare such goals on a biennial basis, a
timeframe much shorter than the 10-year span in between
issuance of the HHS Healthy People reports. The change made in
this provision would ensure that the required application
standards for this program accurately reflect the status of the
Department's work in the area of prevention and wellness.
This provision would require the Secretary to submit an
annual report to Congress on this program.
In updating PHSA sec. 766, the Committee notes that the
program authorized therein currently spans 45 states and the
District of Columbia. While the Committee supports the
program's continuation, it believes its work could be better
integrated with the efforts undertaken through the program
authorized in PHSA sec. 765. Thus, the Committee encourages the
Secretary to bring these programs together as best as possible.
Sec. 2234. Preventive medicine and public health training grant program
Current Law
PHSA sec. 768 authorizes a program of grants and contracts
to support preventive medicine residency and dental public
health training. Eligible entities schools include schools of
medicine, osteopathic medicine, public health, and dentistry.
Proposed Law
This provision would replace the existing language in PHSA
sec. 768 with the following new provision.
Sec. 768. Preventive Medicine and Public Health Training
Grant Program. This new provision would require the Secretary
to establish a program of grants and contracts to provide
training for graduate medical residents in preventive medicine.
Entities eligible to participate in such program would include
(1) accredited schools of public health, medicine, or
osteopathic medicine; (2) accredited public or private
hospitals; and (3) consortia of these entities. Such entities
could receive support for various preventive medicine
residency-related activities, including the operation of
internship or residency programs in preventive medicine or
public health; the defrayment of costs associated with required
practical experiences; and faculty development.
In revising the authority for this program, the Committee
notes the uniqueness of preventive medicine among the various
medical specialties. It is perhaps the only specialty that
combines knowledge and skills in clinical medicine with those
in public health. A 2007 Institute of Medicine report (Training
Physicians for Public Health Careers) cited the importance of
public health physicians in maintaining and improving the
health of the public. It also emphasized the need to address
the various barriers that make it difficult to practice as a
public health physician, including inadequate support for
graduate medical education.
Unlike other specialties, preventive medicine residents
spend time training in community-based outpatient clinics and
public health departments, both of which are ineligible for
Medicare graduate medical education (GME) funding--by far and
away, the main source of support for GME training. As a result,
preventive medicine residency programs rely almost exclusively
on HRSA funding and other sources to support the training of
physicians specializing in this field, many of who go on to
lead public health agencies. In the Committee's view, then, it
is critically important that the preventive medicine and public
health training program authorized under PHSA sec. 768 continue
to receive adequate funding and other support.
In that spirit, the Committee further notes HRSA's recent
decision to amend its own program guidance to clarify the
program's eligibility standard of ``preventive medicine'' to
include all three preventive medicine specialties--general
preventive medicine and public health, occupational medicine,
and aerospace medicine. The Committee strongly endorses the
agency's action and in so doing, recognizes and supports the
need for improved access to preventive medicine physicians in
these three specialties, particularly in general preventive
medicine and public health and occupational medicine.
Physicians who specialize in occupational medicine warrant
special attention. Their efforts parallel those of general
preventive medicine and public health clinicians within the
general public health system--only their work takes place
within in the workplace setting, rather than the traditional
office or clinic site. There, they not only deal with illnesses
and injuries that occur within the workplace population; they
also focus on health promotion and wellness in helping to
reduce the incidence rates of obesity, diabetes, heart disease,
cancer, and other chronic diseases that this population may
experience. These physicians are involved on all fronts--most
especially in actively supporting and providing health
promotion and wellness services. Thus, the Committee strongly
supports HRSA's decision to amend its program guidance material
to ensure that programs that train these preventive medicine
specialists are eligible to participate in this program and
receive appropriate emphasis. As HRSA moves forward with this
new guidance, the Committee urges the agency to consult with
the National Institute for Occupational Safety and Health.
Sec. 2235. Authorization of appropriations
Current Law
Subpart 2 (PHSA sections 765 through 770) of part E of PHSA
title VII (Health Professions Education) authorizes various
public health workforce programs, including general provisions
(PHSA sec. 765); public health training centers (PHSA sec.
766); public health traineeships (PHSA sec. 767); preventive
medicine and dental public health (PHSA sec. 768); and health
administration traineeships and special projects (PHSA sec.
769). The authorization of appropriations for subpart 2 (PHSA
sec. 770) expired at the end of FY2002.
Proposed Law
This provision would authorize the following sums to be
appropriated from the Public Health Investment Fund (as would
be established in sec. 2002 of this legislation) for the
purpose of carrying out various programs related to public
health workforce training activities:
$51 million for FY2010
$54 million for FY2011
$57 million for FY2012
$59 million for FY2013
$62 million for FY2014
These sums from the Fund are in addition to any other
amounts authorized to be appropriated from general revenues for
such purposes.
The provision would extend the authorization of
appropriations for public health workforce programs through
FY2014.
Subtitle D--Adapting Workforce to Evolving Health System Needs
Enhancing the nation's health workforce involves more than
simply increasing the number of providers; it also entails the
development of a more diverse, cultural competent workforce and
the introduction of new and improved service delivery systems.
Experts agree, for example, that it is important for the health
workforce to reflect the nation's increasingly diverse
population, especially since health professionals from diverse
backgrounds are more likely to work in medically underserved
communities. This point was made most recently in MedPAC's 2009
report to Congress (Improving Incentives in the Medicare
Program) in which the advisory group discussed, among other
indicators, the association between a racially and ethnically
diverse health workforce and better access to, and quality of
care for, disadvantaged populations.
Similarly, the complexity of modern medicine and the
increase in chronic disease call for innovation in the ways
health services are currently delivered. A number of expert
panels (including MedPAC, the Institute of Medicine, and the
Council of Graduate Medical Education (COGME)) have pushed for
residency training to focus on increased care coordination,
formal training or experience in multidisciplinary teamwork,
and other such efforts indicative of an innovative approach to
the delivery of health care. The Committee agrees with these
recommendations and believes that incorporating them broadly in
the training of the nation's health workforce is most
appropriate.
Experts have also made a strong case for the creation of an
independent advisory body to make recommendations regarding the
composition of the health workforce. Indeed, in a report issued
in 2007 (Enhancing Flexibility in Graduate Medical Education),
COGME specifically supported the establishment of such a group
whose mandate would also include a review of GME funding
practices.
The purpose of subtitle D is to help address a number of
these issues: diversity in the workforce; cultural and
linguistic competency; interdisciplinary care training; and
workforce assessment and evaluation. Taken together, these
efforts represent a coordinated approach to help ensure that
the nation's 21st century health workforce needs--in their
broadest sense--are met.
Part 1--Health Professions Training for Diversity
Sec. 2241. Scholarships for disadvantaged students, loan repayments and
fellowships regarding faculty positions, and educational
assistance in the health professions regarding individuals from
disadvantaged backgrounds
Current Law
PHSA sec. 738(a) authorizes a program of loan repayments
for individuals from disadvantaged backgrounds who (1) have a
degree in medicine, osteopathic medicine, dentistry, nursing,
public health or another specified health professions; or (2)
are enrolled in an accredited program leading to one of these
degrees and in the final year of study; and (3) agree to serve
as a faculty member in a health professions school for at least
two years. Individuals participating in the program may receive
up to $20,000 of educational loan repayment for each year they
serve as a faculty member.
Proposed Law
This provision would amend PHSA sec. 738(a) to increase the
limit on the amount of loan repayment individuals may receive
for each year they serve as a faculty member to $35,000.
Effective FY2012, the Secretary would be required to adjust
these limits annually for inflation. In increasing these
amounts, the Committee notes that no adjustment has been made
since the program's inception in 1991, heightening the
financial barriers that make it more difficult to attract
people from disadvantaged backgrounds into the teaching
profession.
Sec. 2242. Nursing workforce diversity grants
Current Law
PHSA sec. 821 authorizes the Secretary to establish a
program of grants and contracts to increase nursing education
opportunities for individuals from disadvantaged backgrounds.
Individuals participating in the program may receive various
forms of support, including student scholarships or stipends.
In carrying out this program, the Secretary would be required
to take into account the recommendations of the first (1992),
second (1993), and third (1997) Invitational Congresses for
Minority Nurse Leaders to consult with specified nursing
organizations.
Proposed Law
This provision would amend PHSA sec. 821(b) to delete the
outdated reference to the three Invitational Congresses for
Minority Nurse Leaders. The provision would also delete the
requirement that the Secretary consult with specified nursing
organizations and would instead provide her with the discretion
to consult with such groups as she finds appropriate.
Sec. 2243. Coordination of diversity and cultural competency programs
Current Law
Part B (PHSA sections 736, 737, 738, and 739) of PHSA title
VII (Health Professions Education) authorizes the Secretary to
establish various programs of grants and contracts designed to
help diversify the health professions, including scholarship
and loan repayment programs, education assistance, and centers
of excellence.
Part C (PHSA sec. 821) of PHSA title VIII (Nursing
Workforce Development) authorizes the Secretary to establish a
program of grants and contracts to increase nursing education
opportunities for individuals from disadvantaged backgrounds,
including racial and ethnic minorities underrepresented in the
nursing profession.
Proposed Law
This provision would amend PHSA title VII to add the
following new sec. after PHSA sec. 739:
Sec. 739A. Coordination of Diversity and Cultural
Competency Programs. This new section would require the
Secretary to coordinate the activities authorized under part B
(PHSA sections 736, 737, 738, and 739) of PHSA title VII with
those under part C (PHSA sec. 821) of PHSA title VIII to
enhance their effectiveness and avoid any duplication of
effort.
The Committee has taken this action in response to concerns
that have been raised about HRSA's authority to coordinate the
diversity and cultural competency programs separately
authorized in PHSA titles VII and VIII. The Committee believes
that HRSA does have such authority and that, indeed, it should
coordinate programs and activities for which it has
responsibility whenever appropriate and prudent to do so. With
this new PHSA sec. 739A in place, the Committee believes that
HRSA's ability to work in this fashion has been made clear.
The provision would also amend PHSA sec. 736 to require the
Secretary to submit an annual report to Congress on the Centers
for Excellence program.
Part 2--Interdisciplinary Training Programs
Sec. 2251. Cultural and linguistic competency training for health care
professionals
Current Law
Both PHSA sections 741 and 807 authorize the Secretary to
establish a program of grants, contracts, and cooperative
agreements to support research and demonstration projects on
training health professionals in health disparities and the
provision of culturally competent health care. Neither program
has received funding since their inception in FY2001; the
authority for appropriations under each sec. expired at the end
of FY2004.
Proposed Law
This provision would amend PHSA sec. 741, in essence, to
establish a new program of grants and contracts to develop and
implement cultural and linguistic competency training models
and programs for health professionals. Entities eligible for
support would include: (1) accredited health professions
schools or programs; (2) academic health centers; (3) public or
private nonprofit entities; or (4) consortia of these entities.
In awarding grants or contracts, the Secretary would be
required to give preference to applicants with a demonstrated
record of one or more of the following activities:
Addressing (or partnering with an entity
with experience addressing) the cultural and linguistic
competency needs of the population to be served
Addressing health disparities
Placing health professionals in regions
experiencing significant changes in the cultural and
linguistic demographics of populations (including
communities along the United States-Mexico border)
Carrying out cultural and linguistic
training in more than one health profession discipline,
specialty, or subspecialty
In evaluating an applicant's record regarding the training
of individuals who provide services to populations experiencing
health disparities, this provision would require that the term
health disparities have the meaning given that term in PHSA
sec. 3171 (as would be established in sec. 2301of this
legislation).
The provision would also require the Secretary to consult
with appropriate HHS agencies and offices in developing this
new program. The Committee expects that among these agencies
and offices, in addition to the Office of Minority Health, the
Secretary would consult with the NIH's National Center on
Minority Health and Disparities.
The provision would require the Secretary to submit an
annual report to Congress on the program.
In restructuring PHSA sec. 741, the Committee has chosen to
consolidate both this sec. and PHSA sec. 807 into a single
authority. The language of both sections is identical, with the
only difference between them being their location in the PHSA--
PHSA sec. 741 is authorized in title VII (Health Professions
Education) and PHSA sec. 807 is authorized in title VIII
(Nursing Workforce Development). The provision basically
eliminates this duplication of effort and establishes a new
program designed to better reflect the priorities for cultural
and linguistic competency training necessary to help develop
and maintain a 21st century U.S. health workforce.
Towards that end, the Committee emphasizes its intent that
the new PHSA sec. 741 program include grants and contracts for
the training of any health professional that is a part of the
U.S. health workforce (as that term is defined in sec. 2261 of
this legislation)--not just those who have traditionally been
supported through the title VII and title VIII programs. In
addition, the Committee notes its interest in having this
program support continuing education efforts whose purpose is
to provide appropriate cultural and linguistic competency
training to those who are already in the health workforce.
Sec. 2252. Innovations in interdisciplinary care training
Current Law
Part D (PHSA sections 750-758) of PHSA title VII (Health
Professions Education) is comprised of several authorities to
support various programs to provide interdisciplinary and
community-based education and training.
Proposed Law
This provision would add the following new sec. at the end
of part D of PHSA title VII:
Sec. 759. Innovations in Interdisciplinary Care Training.
This new sec. would require the Secretary to establish a
program of grants and contracts to develop and implement
training programs for health professionals whose focus is the
promotion of health care delivery through interdisciplinary and
team-based models as well as through the coordination of health
care services across various delivery settings, including
health care institutions, the community, and the patient's
home. Entities eligible for support would include: (1)
accredited health professions schools or programs; (2) academic
health centers; (3) public or private nonprofit entities
(including an area health education center or geriatric
education center); or (4) consortia of these entities. In
awarding grants or contracts, the Secretary would be required
to give preference to applicants with a demonstrated record of
one or more of the following activities:
Training health professionals who serve in
underserved communities
Broad, interdisciplinary, team-based
collaboration
Addressing health disparities
In evaluating an applicant's record regarding its
interdisciplinary, team-based collaborations, this sec. would
define the term interdisciplinary to mean collaboration across
health professions and specialties that include public health,
nursing, allied health, and appropriate medical specialties.
The Committee has chosen to define this term to underscore its
purpose in establishing this program--to train health
professionals in delivering their services as part of a team
effort, integrating the whole of patients' physical, mental,
and even oral health needs.
In evaluating an applicant's record regarding its efforts
in addressing health disparities, this sec. would require that
the term ``health disparities'' have the meaning given that
term in PHSA sec. 3171 (as would be established in sec. 2301 of
this legislation).
The Secretary would be required to submit an annual report
to Congress on the program.
The establishment of this new program is complementary to
the Committee's actions in other parts of this legislation
regarding collaborative approaches to patient care. Sections
1301, 1302, and 1722, for example, provide for innovative
payment systems under Medicare and Medicaid that are designed
to reward more collaborative efforts in providing patient care,
including the medical home and accountable care organizations.
Taken together, the Committee believes that these initiatives
can result in an increased number of health professionals
providing better-coordinated care to their patients.
Toward that end, the Committee emphasizes its intent that
this program include grants and contracts for the training of
any health professional that is a part of the U.S. health
workforce (as that term is defined in sec. 2261 of this
legislation)--not just those who have traditionally been
supported through the title VII and title VIII programs. In
addition, the Committee notes its interest in having this
program support continuing education efforts whose purpose is
to provide training in interdisciplinary and team-based health
service delivery to those who are already in the health
workforce.
Part 3--Advisory Committee on Health Workforce Evaluation and
Assessment
Sec. 2261. Health workforce evaluation and assessment
Current Law
Subpart 1 (PHSA sections 761, 762, and 763) of part E of
PHSA title VII (Health Professions Education) authorizes
activities related to the health workforce, including a program
of grants and contracts for the analysis of information on the
health workforce; an Advisory Council on Graduate Medical
Education; and an annual evaluation of the number of pediatric
rheumatologists.
Additional health-related advisory committees are
authorized in PHSA sec. 337 (National Advisory Council for the
National Health Service Corps); PHSA sec. 748 (Advisory
Committee on Training in Primary Care and Dentistry); PHSA sec.
756 (Advisory Committee on Interdisciplinary, Community-Based
Linkages; and PHSA sec. 845 (National Advisory Council on Nurse
Education and Practice).
Proposed Law
This provision would add the following new sec. at the end
of subpart 1 of part E of PHSA title VII:
Sec. 764. Health Workforce Evaluation and Assessment. This
new sec. would require the Secretary to establish a new and
permanent Advisory Committee on Health Workforce Evaluation and
Assessment. The purpose of the Advisory Committee would be to
provide for the continuous and independent review, assessment,
and update of information on the U.S. health workforce as well
as for recommendations on how best to ensure that such
workforce is--and remains--sufficient and of high quality. More
specifically, the Committee expects the scope of the Advisory
Committee's work to include periodic assessments and
recommendations regarding:
The effect of federal policies on ensuring a
sufficient and high quality health workforce, including
the Medicare and Medicaid graduate medical education
programs and HRSA workforce programs
Factors in the health care environment that
may influence the decision making of health
professionals in choosing which discipline, specialty,
and subspecialty they wish to pursue and, as
appropriate, in rebuffing a discipline, specialty, and
subspecialty they may wish to practice
Incentives to encourage health professionals
to become primary care providers
Foreign-trained health professionals and
international medical graduates
The feasibility of an all-payer graduate
medical education system
The Secretary would be required to provide ongoing support
for the Advisory Committee, including support for the
Committee's administrative, research, dissemination, and
technical operations.
In carrying out its work, the Advisory Committee would
first be required to develop classifications, methodologies,
and procedures to be used for health workforce data collection
purposes, particularly in counting the nation's health
workforce. The term ``health workforce'' would be defined to
include all health care providers with direct patient care and
support responsibilities, including physicians, nurses,
physician assistants, pharmacists, and specified professionals
in oral health, allied health, mental and behavioral health,
and public health (including veterinarians engaged in public
health practice). The Committee has chosen to define this term
very broadly so as to include within the Advisory Committee's
charge, the broad spectrum of health professions that make up
the country's health workforce.
Membership on the Advisory Committee would include a
diverse group of individuals with expertise in numerous health
workforce-related areas such as health finance and health
workforce education and training, and with experience working
with various populations, including populations who are
underrepresented in the health professions. Such membership may
not, however, include a majority of individuals who are
directly involved in health professions education or practice.
The Committee underscores the diversity of backgrounds that is
required in assembling and maintaining the Advisory Committee's
membership. The Committee believes such diversity is necessary
to ensure that the questions of health workforce adequacy and
quality are addressed from varying perspectives and take into
account the needs of specific groups or populations, not just
those of the nation as a whole.
The activities of the Advisory Committee would be carried
out in accordance with the Federal Advisory Committee Act
(FACA) (5 U.S.C. App.), except with regard to sec. 14 of that
Act, to the extent that its provisions do not conflict with
this section. The Committee has included this requirement to
ensure the work of the Advisory Committee is conducted in an
open and transparent manner. The Committee believes this is
especially important as the nation transitions through the
health insurance and finance reforms established in other
divisions of this legislation (divisions A and B).
The Secretary would also be required to submit an annual
report to Congress on the activities of the Advisory Committee.
In establishing this new Advisory Committee, the Committee
notes, appreciates, and is encouraged by HRSA's recent efforts
to coordinate the activities of other advisory committees
assembled to examine health workforce issues related to their
specific areas of interest. These committees play an important
role in making programmatic recommendations and assessing the
needs of the specific health professions they represent. For
example, the Council on Graduate Medical Education makes
recommendations pertaining only to the physician workforce; the
National Advisory Council on Nurse Education and Practice looks
at only nurse workforce issues. They do not, however, consider
broader questions, such as the overall need for primary care--
irrespective of the classification of provider. It would be the
specific task of the Advisory Committee established in this
section to take on that kind of evaluation.
The Committee strongly believes the work of these specialty
committees should continue and that HRSA, too, should continue
to promote coordination among their activities whenever and
wherever appropriate and effective. But the Committee also
believes--along with numerous health workforce experts--that
these initiatives are no substitute for an independent body
charged with the responsibility to perform regular and periodic
assessments of the nation's health workforce and to make
recommendations to Congress on policies for ensuring that this
workforce--in all its many facets--is both sufficient in number
and of high quality. Thus, the Committee has not only
established the Advisory Committee on a permanent and ongoing
basis; it also intends that its work extend beyond those
workforce programs authorized under the PHSA titles III
(General Powers and Duties of Public Health Service), VII
(Health Professions Education), and VIII (Nursing Workforce
Development) to include health workforce-related programs under
Medicare, Medicaid, the VA, and the Department of Defense.
Part 4--Health Workforce Assessment
Sec. 2271. Health workforce assessment
Current Law
PHSA section 761 authorizes the Secretary to establish a
program of grants and contracts to support the development and
provision of information and analysis related to the health
workforce, including the nurse workforce. Subsection (c) of
PHSA sec. 761 requires the Secretary to reserve no less than
$600,000 of funds appropriated for this program for conducting
health professions research and for carrying out data
collection and analysis in accordance with PHSA sec. 792
(Health Professions Data). Subsection (a) of that section
requires the Secretary to establish a program to collect,
compile, and analyze data on health professions personnel. The
authorization of appropriations under PHSA sec. 761 expired at
the end of FY2002, although the program continued to receive
funding through FY2005.
Proposed Law
This provision would amend subsections (a) and (b) of PHSA
sec. 761 to strike these subsections and to replace them with
new requirements designed to implement the health workforce
data collection classifications, methodologies, and procedures
developed by the Advisory Committee on Health Workforce
Evaluation and Assessment (as would be established in sec. 2261
of this legislation). Using these standards, the Secretary
would be required to collect data on the nation's health
workforce supply, diversity, and geographic distribution. In
addition, the Secretary would be required to collect such data
on individuals participating in the programs that would be
authorized in subtitles A (Primary Care Workforce); B (Nursing
Workforce); and C (Public Health Workforce); and part 1 of
subtitle D (Health Professions Training for Diversity), all of
title II of division C of this legislation.
Pending the completion of the development of the Advisory
Committee's data collection standards, the Secretary (in
consultation with the Advisory Committee) would be authorized
to make a judgment about the classifications, methodologies,
and procedures to be used in carrying out the data collection
activities required under this provision. This authority would
expire at the time the Secretary adopts the Advisory
Committee's recommendations regarding such standards. The
Committee has granted the Secretary this time-limited authority
in order to avoid any delay in the implementation of this
provision's data collection requirements. The Committee
believes that it is imperative that these efforts more forward
as quickly as possible and that the timeline for action by the
Advisory Committee should not impede her progress in collecting
all relevant data.
The Secretary would be authorized to award grants or
contracts to carry out the data collection activities required
under this provision. Entities eligible to participate in this
effort include (1) accredited health professions schools or
programs; (2) academic health centers; (3) state, local or
tribal governments; (4) public or private entities; or (5)
consortia of these entities.
In carrying out these data collection requirements, the
Secretary would be required to collaborate with federal
departments and agencies, health professions organizations, and
professional medical societies. Because neither HHS nor the
federal government as a whole either collects or maintains all
of the information relevant to the nation's health workforce
supply, diversity or geographic distribution, the Committee
believes it is necessary for the Secretary to work with groups
outside the government in obtaining this information.
The Secretary would also be required to submit an annual
report to Congress on various requirements of this provision.
The Committee understands that the Secretary is already
engaged in some health workforce collection activities. But
they have not been nearly as targeted as those required in this
provision. Nor have they received adequate resources to develop
the kind of projections contemplated by the Committee.
In establishing these new data collection requirements, the
Committee is responding to these concerns as well as
recommendations made by the GAO (Health Professions Education
Programs: Action Still Needed to Measure Impact (Feb. 2006)
(GAO-06-55)) and numerous experts about the importance of
collecting, analyzing, and reporting information on the supply,
demand, and diversity of the nation's health workforce. The
Committee believes such information is important for the
purpose of evaluating the government's own efforts in
addressing the nation's health workforce needs. But it also
believes that this information will become even more critical
to both HHS and the Congress as the health reforms established
in other divisions of this legislation (divisions A and B) are
implemented.
Part 5--Authorization of Appropriations
Sec. 2281. Authorization of appropriations
Current Law
The authorizations of appropriations for the following
programs expired at the end of FY2002: centers of excellence
(PHSA sec. 736); programs authorized for appropriations under
PHSA sec. 740 (including scholarships for disadvantaged
students (PHSA sec. 737); loans repayments for faculty (PHSA
sec. 738); educational assistance in the health professions
regarding individuals from disadvantaged backgrounds (PHSA sec.
739); and health workforce information and analysis (PHSA sec.
761)). However, with the exception of the activities authorized
under PHSA sec. 761 (which has never been funded), each of
these programs has continued to receive annual appropriations.
The authorization of appropriations for the education and
health disparities and cultural competency program (PHSA sec.
741) expired at the end of FY2004.
Proposed Law
This provision would authorize the following sums to be
appropriated from the Public Health Investment Fund (as would
be established in sec. 2002 of this legislation) for the
purpose of carrying out various programs related to health
workforce diversity and assessment and evaluation activities:
Health Professions Training for Diversity (PHSA sections
736 through 739A)--
$90 million for FY2010
$97 million for FY2011
$100 million for FY2012
$104 million for FY2013
$110 million for FY2014
Interdisciplinary Training Programs; Advisory Committee on
Health Workforce Evaluation and Assessment; and Health
Workforce Assessment (PHSA sections 741, 759, 761, and 764)--
$87 million for FY2010
$97 million for FY2011
$103 million for FY2012
$105 million for FY2013
$113 million for FY2014
These sums from the Fund are in addition to any other
amounts authorized to be appropriated from general revenues for
such purposes.
The provision would also authorize to be appropriated
``such sums as may be necessary'' for each fiscal year through
FY2014 for the education and health disparities and cultural
competency program authorized under PHSA sec. 741. In addition,
the provision would extend existing authorizations of
appropriations through FY2014 for centers of excellence (PHSA
sec. 736); programs authorized for appropriations under PHSA
sec. 740 (including scholarships for disadvantaged students
(PHSA sec. 737); loan repayments for faculty (PHSA sec. 738);
educational assistance for individuals from disadvantaged
backgrounds (PHSA sec. 739); and health workforce information
and analysis (PHSA sec. 761)).
These workforce diversity programs are widely regarded as
being highly successful in bringing individuals from
disadvantaged backgrounds (especially those from racial and
ethnic minorities) into the health professions and, in turn,
helping to diversity the health workforce. It is the
Committee's view that these programs should continue to receive
appropriate funding support through FY2014.
TITLE III--PREVENTION AND WELLNESS
The evidence is clear: An individual's health status is
determined not only by the availability and quality of clinical
care he or she receives, but also by various social, economic,
and behavioral factors. Thus, improving America's health
requires ensuring both access to quality medical services when
citizens are in need of care, and the presence of a strong
public health system designed to keep people well in the first
place and their communities safe all the time. Divisions A and
B of this legislation are intended to help achieve the first
goal; title III of division C targets the second.
There are many ways in which this latter objective can be
met. Promoting the use of evidence-based analyses of preventive
services can help arm health care providers and communities
alike with the tools necessary to detect public health problems
early on or to prevent them altogether. Improvements in state
and local public health infrastructure (such as public health
departments and laboratories) can, for example, assist
community-wide efforts in addressing the nation's obesity
epidemic or stopping outbreaks of food-borne disease. And
bolstering resources across the board at the federal, state,
and local level can enhance government's capacity to put
programs that work into place.
But unlike medical services and biomedical research, the
federal government has not made sustained and sizeable
investments in public health. Indeed, support for public health
activities account for less than 3% of all federal spending on
health care.
Title III establishes new public health initiatives and
provides fixed public health funding to support them. When
taken together and fully implemented, the result is expected to
be an enormous impact on improving the nation's health.
Sec. 2301. Prevention and wellness
Current Law
No comparable provisions.
Although the PHSA as well as other federal laws such as
Medicare and Medicaid authorize numerous programs and
activities related to prevention and wellness, there is no
statute (or sec. of a statute) that provides for a
comprehensive, national approach for these efforts. In
particular, there is no comparable provision that provides for
dedicated, mandatory spending to support them.
Proposed Law
Subsection (a) of this provision would establish a new PHSA
entitled ``Prevention and Wellness'' consisting of the
following seven subtitles:
TITLE XXXI--PREVENTION AND WELLNESS
``Subtitle A--Prevention and Wellness Trust
``Sec. 3111. Prevention and Wellness Trust''
Current Law
No comparable provisions.
Proposed Law
This sec. would establish a Prevention and Wellness Trust.
The following amounts would be authorized to be appropriated to
the Trust:
For each fiscal year, any amount
appropriated to the Prevention and Wellness Fund under
the American Recovery and Reinvestment Act (P.L. 111-5)
From the Public Health Investment Fund (as
would be established in sec. 2002 of this legislation)
$2.4 billion for FY2010
$2.845 billion for FY2011
$3.1 billion for FY2012
$3.455 billion for FY2013
$3.6 billion for FY2014
These sums from the Fund are in addition to any other
amounts authorized to be appropriated from general revenues for
such purposes.
The sec. would also specify the amounts authorized to be
appropriated from the Trust for each of FY2010 through FY2014
for carrying out the activities of each of subtitle C
(Prevention Task Forces); subtitle D (Prevention and Wellness
Research); subtitle E (Delivery of Community Preventive and
Wellness Services); and subtitle F (Core Public Health
Infrastructure).
The Committee has established this special funding source
in recognition of the need for dedicated sources to support
prevention and wellness activities. Currently, approximately
78% of all health care spending in the United States is
attributable to chronic illness, while only 3% of such spending
goes to preventive services and health promotion. Funds made
available through the Prevention and Wellness Trust will help
address this disparity. The Committee expects that, in turn,
Americans can become healthier and over time, the burden of
chronic disease can be reduced.
``Subtitle B--National Prevention and Wellness Strategy
``Sec. 3121. National Prevention and Wellness Strategy''
Current Law
No comparable provisions.
Under the general authorities of PHSA title XVII, the
Surgeon General of the U.S. Public Health Service has developed
the Healthy People Program that is responsible for setting the
nation's health prevention strategy and goals. The Secretary
issues the decennial Healthy People report through this
program. The report includes broad population-based health
goals that are targeted to be met on a national basis, within
the decade covered by the report.
Proposed Law
The Secretary would be required to develop (and
periodically update) a national strategy to improve the
nation's health through evidence-based clinical and community-
based prevention and wellness activities (including core public
health infrastructure improvements). In essence, this strategy
would provide a national blueprint for action in making the
United States a healthier nation. Such strategy would include
specific national prevention and wellness goals, objectives,
and priorities as well as a detailed plan for meeting each of
them. Throughout the strategy, special attention is required to
be given to health disparities in prevention and wellness.
In developing this strategy, the Committee intends that
special attention also be given in developing prevention and
wellness goals, objectives, and priorities related to the
prevention of chronic disease. Currently, some nearly one in
two American adults suffers from one or more chronic diseases,
incurring approximately $1.5 trillion in costs each year, or
some 75% of the nation's annual health care spending. In the
Committee's view, it is imperative that the national strategy
takes on this issue directly.
In addition, the Committee notes the importance of the
strategy's addressing the issue of payment or reimbursement for
prevention services. Without sufficient payment mechanisms in
place (or other appropriate incentives or rewards), the
Committee is concerned that neither health care professionals
nor communities will be able to adequately provide those
prevention services and interventions that have been
demonstrated to be effective.
``Subtitle C--Prevention Task Forces
``Sec. 3131. Task Force on Clinical Preventive Services''
Current Law
PHSA sec. 915(a) establishes the authority for the U.S.
Preventive Services Task Force (USPSTF), administered by the
Agency for Healthcare Research and Quality (AHRQ). The sec.
charges the USPSTF to conduct evidence-based systemic reviews
of data and literature to determine what clinical preventive
services--preventive services delivered to one patient at a
time by traditional health care providers in clinical
settings--are scientifically proven to be effective, and based
upon such reviews, to develop recommendations for the health
care community. It also requires AHRQ to provide
administrative, research, and technical support to the USPSTF,
and exempts the Task Force from requirements of the Federal
Advisory Committee Act (FACA) (5 U.S.C. App.).
The U.S. Public Health Service first convened the USPSTF in
1984. Since that time, the Task Force has produced 74 reviews
and 120 age and gender-specific recommendations.
Proposed Law
The Secretary would be required to establish a permanent
Task Force on Clinical Preventive Services (Clinical Preventive
Task Force) that would continue the work of the USPSTF. The
charge to the Clinical Preventive Task Force would remain just
as it is today--to study and make evidenced-based
recommendations on the effectiveness of clinical preventive
services. Administrative responsibility for the Clinical
Preventive Task Force would also remain where it is today--
AHRQ.
The Committee underscores its overall objective to maintain
for the Clinical Preventive Task Force, the well-earned
credibility, independence, and scientific integrity of its
predecessor organization, the USPSTF. In revising the authority
for this preventive services task force, the Committee simply
intends to statutorily improve some of the current practices
and procedures and to augment available resources. Indeed, as
the USPSTF transitions to the Task Force on Clinical Preventive
Services, the Committee does not anticipate any significant
changes in operations.
As noted, while the core mission of the Clinical Preventive
Task Force would not change, the provision would make some
structural and funding modifications designed to ensure that
the group can carry out its work most effectively and
efficiently. Such modifications include increasing the size of
the membership of the Task Force; establishing criteria for
such membership; and providing for an authorization of
appropriations.
In addition to mandating its principal duties to identify,
review, and make recommendations on clinical preventive
services, the sec. would also require the Clinical Preventive
Task Force to take on new responsibilities, all of which are
directly related to its basic assignment. More specifically, in
performing its work, the Clinical Preventive Task Force would
be required to: (1) consider health disparities in making its
recommendations: (2) consult with the Task Force on Community
Preventive Services (as would be established in sec. 3132 of
PHSA title XXXI of this legislation); (3) make recommendations
regarding clinical preventive services research and evaluation;
(4) as appropriate, consult with the clinical preventive
stakeholders board that would be established as part of the
operation of the Clinical Preventive Task Force; and (5) as
appropriate, consider the national strategy on prevention and
wellness (as would be developed in sec. 3121 of PHSA title XXXI
of this legislation).
In requiring that the Clinical Preventive Task Force
consider health disparities in making its recommendations, the
Committee underscores its intent that the Task Force act not
only with regard to national recommendations, but also as
appropriate, with respect to specific populations and even sub-
populations. For example, should the Task Force make general
recommendations regarding screening for lipid disorders among
persons at risk for coronary heart disease (CHD), the Committee
would expect it to include recommendations that may be
different for African Americans than for other U.S. populations
because this group has a higher prevalence of diabetes,
hypertension, and obesity, conditions that increase the risk
for CHD.
The activities of the Clinical Preventive Task Force would
be carried out in accordance with the FACA (5 U.S.C. App.),
except with regard to sec. 14 of that Act, to the extent that
its provisions do not conflict with the provisions of this
section. The Committee has included this requirement to ensure
the work of the Task Force is conducted in an open and
transparent manner, while preserving its function and status as
an expert panel that advises not only federal officials but
also the broader health and health care communities. The
Committee believes this is especially important because of the
new and important role of the Task Force's work in implementing
some of the reforms in the health care system provided for in
this legislation, including the elimination of all cost-sharing
requirements for clinical preventive services covered in the
essential benefits package (as would be established in sec. 122
of this legislation) and provided under Medicare and Medicaid
(as would be established respectively in sec. 1305 and sec.
1711 of this legislation). Such services would include those
that receive either an ``A'' or ``B'' rating by the Clinical
Preventive Task Force (or its predecessor organization, the
USPSTF).
The Secretary would be required to submit an annual report
to Congress on the work of the Clinical Preventive Task Force.
PHSA sec. 3111 (as would be established in PHSA title XXXI
of this legislation) would authorize an annual appropriation of
$30 million from the Prevention and Wellness Trust for each of
FY2010 through FY2014 to support the work of both the Clinical
Preventive Task Force and the Task Force on Community
Preventive Services (as would be established in sec. 3132 of
PHSA title XXXI of this legislation). These sums from the Fund
are in addition to any other amounts authorized to be
appropriated from general revenues for such purposes.
``Sec. 3132. Task Force on Community Preventive Services''
Current Law
No comparable provisions.
The Task Force on Community Preventive Services (TFCPS) is
not explicitly authorized in statute; rather, it functions
under the general authorities of the Secretary found in PHSA
title III (General Powers and Duties of Public Health Service).
The TFCPS is a non-governmental panel of public health and
prevention experts that is administered and supported by the
CDC. Much like the U.S. Preventive Services Task Force, it is
charged with conducting evidence-based systematic reviews of
data and literature and based upon such reviews, making
recommendations regarding preventive services. Its focus,
however, is on population-based or community interventions,
rather than clinical preventive services. Such interventions
are designed to be provided to groups of people--rather than to
an individual as is the case with clinical preventive
services--by a range of providers in a variety of settings.
Their purpose is to facilitate and reinforce, from a public
health perspective, what is taught or learned in the health
provider's office or other traditional clinical setting.
The TFCPS was first convened in 1996. Since that time, the
Task Force has produced recommendations on some 200 community
preventive services or interventions. Among these are worksite
wellness programs to promote physical activity among employees;
school-based sealant programs to reduce the risk of dental
caries; and tobacco cessation activities.
Proposed Law
The Secretary would be required to establish a permanent
Task Force on Community Preventive Services (Community
Preventive Task Force) that would continue the work of the
TFCPS. The charge to the Community Preventive Task Force would
remain just as it is today--to study and make evidenced-based
recommendations on the effectiveness of community preventive
services or interventions. Administrative responsibility for
the Community Preventive Task Force would also remain where it
is today--CDC.
The Committee underscores its overall objective to maintain
for the Community Preventive Task Force, the well-earned
credibility, independence, and scientific integrity of its
predecessor organization, the TFCPS. In establishing an
explicit authority for the Task Force on Community Preventive
Services, the Committee simply intends to make the TFCPS
permanent and in so doing, to statutorily improve some of its
current practices and procedures and to augment available
resources. Indeed, as the TFCPS transitions to a group with
permanent authority, the Committee does not anticipate any
significant changes in operations.
As noted, while the core mission of the Community
Preventive Task Force would not change, the provision would
make some structural and funding modifications designed to
ensure that the group can carry out its work most effectively
and efficiently. Such modifications include increasing the size
of the membership of the Task Force; establishing criteria for
such membership; and providing for an authorization of
appropriations.
In addition to mandating its principal duties to identify,
review, and make recommendations on community preventive
services or interventions, the provision would also require the
Community Preventive Task Force to take on new
responsibilities, all of which are directly related to its
basic assignment. More specifically, in performing its work,
the Community Preventive Task Force would be required to: (1)
as appropriate, consider health disparities in making its
recommendations; (2) consult with the Task Force on Clinical
Preventive Services (as would be established in sec. 3131 of
PHSA title XXXI of this legislation); (3) make recommendations
regarding community preventive services research and
evaluation; (4) as appropriate, consult with the community
preventive stakeholders board that would be established as part
of the operation of the Community Preventive Task Force; and
(5) as appropriate, consider the national strategy on
prevention and wellness (as would be developed in sec. 3121 of
PHSA title XXXI of this legislation).
In requiring that the Community Preventive Task Force
consider health disparities in making its recommendations, the
Committee underscores its intent that the Task Force act not
only with regard to national recommendations, but also, as
appropriate, with respect to specific populations and even sub-
populations. For example, client reminders and small media
campaigns promoting breast cancer screening among African-
American women might put greater emphasis on educating these
women about the importance of early diagnosis since African
Americans have higher breast cancer mortality rates due, in
large part, to late diagnosis.
The activities of the Community Preventive Task Force would
be carried out in accordance with FACA (5 U.S.C. App.), except
with regard to sec. 14 of that Act, to the extent that its
provisions do not conflict with the provisions of this section.
The Committee has included this requirement to ensure that the
work of the Community Preventive Task Force is conducted in an
open and transparent manner, while preserving its function and
status as an expert panel that advises not only federal
officials but also the broader health and health care
communities. The Committee believes this is especially
important because of the new and important role of the Task
Force's work in implementing the community prevention and
wellness services grant community (as would be established in
sec. 3151 of PHSA title XXXI of this legislation).
The Secretary would be required to submit an annual report
to Congress on the work of the Community Preventive Task Force.
PHSA sec. 3111 (as would be established in PHSA title XXXI
in this legislation) would authorize to be appropriated $30
million from the Prevention and Wellness Trust for each of
FY2010 through FY2014 to support the work of both the Community
Preventive Task Force and the Task Force on Clinical Preventive
Services (as would be established in section 3131 of PHSA title
XXXI in this legislation). These sums from the Fund are in
addition to any other amounts authorized to be appropriated
from general revenues for such purposes.
``Subtitle D--Prevention and Wellness Research
``Sec. 3141. Prevention and wellness research activity coordination''
Current Law
No comparable provisions.
Proposed Law
The Directors of the CDC and NIH and the heads of other HHS
agencies would be required, in conducting or supporting
research on prevention and wellness, to take into consideration
the national strategy on prevention and wellness (as would be
developed in section 3121 of PHSA title XXXI of this
legislation) and the recommendations of both the Task Force on
Clinical Preventive Services (as would be established in
section 3131 of PHSA title XXXI of this legislation) and the
Task Force on Community Preventive Services (as would be
established in section 3132 of PHSA title XXXI of this
legislation). The Committee has taken this action to ensure
that research efforts called for to help address the priorities
and needs identified in this strategy and by these task forces
are not only funded, but also coordinated--especially by the
federal government's two principal prevention and wellness
research agencies: CDC and NIH. With limited dollars available
for such research, the Committee believes it is imperative that
these agencies work together in formulating an appropriate and
robust prevention and wellness research agenda.
``Sec. 3142. Community prevention and wellness research grants''
Current Law
No comparable provisions.
Proposed Law
The Secretary would be required to establish a program to
conduct or support research in priority areas identified in the
national strategy on prevention and wellness (as would be
developed in section 3121 of PHSA title XXXI of this
legislation) or by the Task Force on Community Preventive
Services (as would be established in section 3132 of PHSA title
XXXI of this legislation). Entities eligible to participate in
such program include: (1) state, local, or tribal departments
of health; (2) public and nonprofit private entities; and (3)
consortia of these entities. The Secretary would be required to
submit an annual report to Congress on the research supported
through this program.
PHSA section 3111 (as would be established in PHSA title
XXXI of this legislation) would authorize the following sums to
be appropriated from the Prevention and Wellness Trust for the
purpose of carrying out prevention and wellness research:
$100 million for FY2010
$150 million for FY2011
$200 million for FY2012
$250 million for FY2013
$300,000,000 for FY2014
These sums from the Fund are in addition to any other
amounts authorized to be appropriated from general revenues for
such purposes.
The Committee has established this program to ensure that
community prevention and wellness research needs and priorities
identified through various mechanisms provided under PHSA title
XXXI (as would be established in this legislation) are
addressed. But beyond those immediate and ongoing concerns, the
Committee believes that it is necessary to create a dedicated
prevention and wellness research program to underscore the
importance of this research. Community-based research
(including community-based participatory research) is the
primary means by which innovative prevention and wellness
programs become effective public health interventions. Yet it
is often under-funded or even neglected altogether because of
the long-standing emphasis on and support for traditional
clinical or medical research models. With a separate pool funds
made available through this new and targeted research
authority, the Committee would expect a significant increase in
community prevention and wellness research and in turn, the
development and implementation of additional evidence-based
community public health interventions.
``Subtitle E--Delivery of Community Prevention and Wellness Services
``Sec. 3151. Community prevention and wellness services grants''
Current Law
No comparable provisions.
PHSA title III (General Powers and Duties of Public Health
Service) provides CDC with various authorities to support
numerous prevention and wellness activities, including those
targeted at chronic diseases. Part A of PHSA title XIX (Block
Grants) requires the Secretary to provide formula-based grants
to states through the Preventive Health and Health Services
Block Grant Program to address state-identified prevention
priorities. The authorization of appropriations for that
program expired at the end of FY1998, although the program has
continued to receive annual appropriations.
Proposed Law
The Secretary would be required to establish a program of
grants to plan or implement programs that deliver evidence-
based community prevention and wellness services and
interventions in priority areas that have been identified by
the Secretary in the national strategy on prevention and
wellness (as would be developed in section 3121 of PHSA title
XXXI of this legislation). Entities eligible to participate in
such a program include: (1) state, local, or tribal departments
of health; (2) public or private entities; (3) consortia of
these entities; or (4) community partnerships representing
health empowerment zones (as that term would be defined in this
sec.).
In awarding grants or contracts, the Secretary would be
required to give preference to applicants that:
Will address one or more goals or objectives
identified by the Secretary in the national strategy on
prevention and wellness
Will address significant health disparities
Will address unmet community prevention and
wellness needs
Have a demonstrated record of effectiveness in
communities comparable to those that are the subject of the
grant application
Will make a significant contribution to the
evidence base for community prevention and wellness services
Demonstrate that the prevention and wellness
activities to be funded will be sustainable
Demonstrate coordination or collaboration across
governmental and nongovernmental partners
The program would be structured to allow great latitude in
the types of services or interventions that could be
supported--so long as such services and interventions: (1) have
been determined to be a priority in the national prevention and
wellness strategy or by the Community Preventive Task Force;
and (2) are evidenced-based. Indeed, effective FY2013, grants
could only be awarded to support services and interventions
recommended by the Community Preventive Task Force or deemed to
be effective, based on a review of comparable rigor (as
determined by the CDC Director). Thus, the Committee intends
that a broad spectrum of evidence-based prevention and wellness
services and interventions may be supported through this
program, including those related to physical, mental, oral and
other appropriate areas of health. Examples of the many types
of activities that could be funded include workplace obesity
reduction programs; programs to improve and expand access to
mental health services for at-risk youth and their families;
the promotion of healthy, nutritious, and sustainable food in
schools and other appropriate institutions; and community-based
health screenings and education. The Committee further intends
that funding be available not only to support programs targeted
on a single community preventive service or intervention,
(e.g., workplace obesity reduction programs), but also those
that may be designed to include multiple, but related such
services or interventions (e.g., workplace obesity reduction
programs, community exercise programs, and nutrition education)
or to address more than one prevention and wellness priority
(e.g., diabetes and heart disease).
Although the Committee intends for the program to be able
to support a broad array of community prevention and wellness
services or interventions, grant awards may not be used to
build or acquire real property, for construction, or to provide
services that would otherwise be paid (or expected to be paid)
by a private insurance plan or a public health benefits program
such as Medicaid.
The Secretary would also be required to award at least 50%
of available funds to projects whose primary purpose is to
achieve a measurable reduction in one or more ``health
disparities'' (as that term would be defined in section 3171 of
PHSA title XXXI of this legislation). Accordingly, community
prevention and wellness programs or projects could be designed
to address health disparities by race, ethnicity, or geographic
setting (such as rural or urban setting), or disparities
experienced by other populations or subpopulations as
determined appropriate by the Secretary.
The Secretary would be required to submit an annual report
to Congress on the programs, projects, and other activities
supported through this program.
PHSA section 3111 (as would be established in this
legislation) would authorize the following sums to be
appropriated from the Prevention and Wellness Trust for the
purpose of supporting community prevention and wellness
services grants: