A bill to amend title XVIII of the Social Security Act to stabilize and modernize the provision of partial hospitalization services under the Medicare program, and for other purposes.

Summary: Outpatient Mental Health Modernization Act of 2008 - Establishes a moratorium between January 1, 2009, and January 1, 2010, on changes in the Medicare outpatient department (OPD) fee schedule amount established for partial hospital (episode and visit) services.

Amends title XVIII (Medicare) of the Social Security Act to: (1) establish an accreditation program for community mental health centers providing partial hospitalization services; (2) require a specified reduction in the OPD fee schedule increase factor for any such center that fails to submit required data on its partial hospitalization services; and (3) establish a minimum number of four units of items and services as a requirement for coverage of such services.

Directs the Secretary of Health and Human Services to require fiscal intermediaries under the Medicare program to file the cost reports of providers of partial hospitalization services into the Healthcare Provider Cost Reporting Information System (HCRIS) maintained by the Centers for Medicare & Medicaid Services.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Outpatient Mental Health 
Modernization Act of 2008''.

SEC. 2. TRANSITIONAL FREEZE ON CERTAIN MEDICARE HOSPITAL OUTPATIENT FEE 
              SCHEDULE AMOUNTS.

    Notwithstanding any other provision of law, effective for episodes 
and visits beginning on or after January 1, 2009, and before January 1, 
2010, in the case of partial hospital services (as defined in section 
1861(ff)(1) of the Social Security Act (42 U.S.C. 1395x(ff)(1)), the 
OPD fee schedule increase factor under section 1833(t)(3)(C)(iv) of the 
Social Security Act (42 U.S.C. 1395l(t)(3)(C)(iv)) for the medicare OPD 
fee schedule amount established for such services (as published in the 
Federal Register on November 27, 2007 (72 Fed. Reg. 66670)) shall be 
zero.

SEC. 3. ACCREDITATION PROGRAM FOR COMMUNITY MENTAL HEALTH CENTERS 
              PROVIDING PARTIAL HOSPITALIZATION SERVICES.

    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) Accreditation program for community mental health 
        centers providing partial hospitalization services.--
                    ``(A) Definitions.--In this section:
                            ``(i) Accreditation organization.--The term 
                        `accreditation organization' means an 
                        organization designated by the Secretary under 
                        subparagraph (C)(i)(II) to accredit community 
                        mental health centers providing partial 
                        hospitalization services.
                            ``(ii) Partial hospitalization services.--
                        The term `partial hospitalization services' has 
                        the meaning given such term in section 
                        1861(ff)(1).
                            ``(iii) Physician.--Except as otherwise 
                        provided by the Secretary, the term `physician' 
                        means any individual who furnishes services for 
                        which payment may be made under the physician 
                        fee schedule under section 1848.
                            ``(iv) Physician specialty organization.--
                        The term `physician specialty organization' 
                        means a United States medical specialty society 
                        that represents diplomats certified by a board 
                        recognized by the American Board of Medical 
                        Specialties.
                    ``(B) Establishment.--Not later than January 1, 
                2010, subject to the succeeding provisions of this 
                paragraph, the Secretary shall, by regulation, 
                establish an accreditation program which requires the 
                accreditation of community mental health centers 
                providing partial hospitalization services.
                    ``(C) Design of accreditation program.--
                            ``(i) In general.--Each community mental 
                        health center providing partial hospitalization 
                        services for which payment is made under the 
                        prospective payment system established under 
                        this subsection must be accredited for each 
                        program under which such services are furnished 
                        by the community mental health center by an 
                        accrediting organization designated by the 
                        Secretary under clause (ii).
                            ``(ii) Accreditation organizations.--
                                    ``(I) In general.--The Secretary 
                                shall, by regulation, designate 
                                entities to accredit community mental 
                                health centers providing partial 
                                hospitalization services. The entities 
                                designated under the preceding sentence 
                                shall include the Joint Commission on 
                                Accreditation of Hospitals and the 
                                Commission on Accreditation of 
                                Rehabilitation Facilities.
                                    ``(II) Consultation.--In 
                                designating entities under subclause 
                                (I), the Secretary shall consult with 
                                academic medical centers, community 
                                mental health centers, hospitals, and 
                                other appropriate medical personnel 
                                (such as psychologists, social workers, 
                                and nurse specialists).
                            ``(iii) Considerations.--In designating 
                        entities under clause (ii), the Secretary shall 
                        consider the following:
                                    ``(I) The ability of the entity to 
                                conduct timely reviews of accreditation 
                                applications.
                                    ``(II) Whether the entity has 
                                established a process for the timely 
                                integration of new services and 
                                clinical interventions for individuals 
                                who are furnished partial 
                                hospitalization services.
                                    ``(III) Any other factors the 
                                Secretary determines appropriate.
                            ``(iv) Use of criteria for accreditation.--
                        Accreditation organizations shall use 
                        appropriate criteria for evaluating community 
                        mental health centers providing partial 
                        hospitalization services for purposes of the 
                        accreditation of such community mental health 
                        centers, including criteria with respect to--
                                    ``(I) the qualifications of 
                                nonphysician medical personnel;
                                    ``(II) the qualifications and 
                                responsibilities of physicians, 
                                including supervising physicians;
                                    ``(III) the establishment of 
                                procedures for ensuring patient safety; 
                                and
                                    ``(IV) quality assurance reporting.
                            ``(v) Incorporation of quality measures.--
                        Not later than January 1, 2012, the Secretary 
                        shall provide for the incorporation of measures 
                        selected for purposes of quality reporting 
                        under paragraph (19) into the accreditation 
                        program established under this paragraph, 
                        including the use of such measures in the 
                        criteria for accreditation under clause (iv).
                            ``(vi) Review of accreditation 
                        organizations.--The Secretary, in consultation 
                        with the entities and individuals described in 
                        clause (ii)(II)--
                                    ``(I) shall conduct an annual 
                                review of accreditation organizations 
                                designated under clause (ii); and
                                    ``(II) may, by regulation, expand 
                                the original list of accreditation 
                                organizations so designated.
                    ``(D) Evaluation and report.--
                            ``(i) Evaluation.--The Secretary shall 
                        contract with an independent, private 
                        organization or entity to evaluate the effect 
                        of the accreditation program established under 
                        this paragraph and other relevant questions 
                        involving access to and value of partial 
                        hospitalization services furnished to 
                        individuals under this part. Such evaluation 
                        shall examine the following:
                                    ``(I) The impact of accreditation 
                                requirements on the number, type, and 
                                quality of partial hospitalization 
                                services furnished to individuals under 
                                this part.
                                    ``(II) The cost of meeting such 
                                accreditation requirements, including 
                                an examination of compliance costs to 
                                community mental health centers 
                                providing partial hospitalization 
                                services and administrative costs to 
                                the Secretary.
                                    ``(III) The access of individuals 
                                under this part to partial 
                                hospitalization services, especially in 
                                rural areas, before and after 
                                implementation of the accreditation 
                                program.
                                    ``(IV) Any other matters the 
                                Secretary determines appropriate.
                            ``(ii) Report.--Not later than December 31, 
                        2012, the Secretary shall submit a report to 
                        Congress on the evaluation conducted under 
                        clause (i).
                    ``(E) Waiver authority.--The Secretary shall waive 
                compliance with the requirements of this title to such 
                extent and for such period as the Secretary determines 
                is necessary to carry out this paragraph.''.

SEC. 4. QUALITY IMPROVEMENT FOR PARTIAL HOSPITALIZATION SERVICES 
              PROVIDED BY COMMUNITY MENTAL HEALTH CENTERS.

    Section 1833(t) of the Social Security Act (42 U.S.C. 1395l(t)), as 
amended by section 3, is amended by adding at the end the following new 
paragraph:
            ``(19) Quality reporting for partial hospitalization 
        services provided by community mental health centers.--
                    ``(A) Reduction in update for failure to report.--
                For purposes of paragraph (3)(C)(iv) for 2009 and each 
                subsequent year, in the case of a community mental 
                health center providing partial hospitalization 
                services (as defined in section 1861(ff)(1)) that does 
                not submit, to the Secretary in accordance with this 
                paragraph, data required to be submitted on measures 
                selected under this paragraph with respect to such a 
                calendar year, the OPD fee schedule increase factor 
                under paragraph (3)(C)(iv) for such year shall be 
                reduced by 1.0 percentage point. A reduction under the 
                preceding sentence shall apply only with respect to the 
                year involved and the Secretary shall not take into 
                account such reduction in computing the OPD fee 
                schedule increase factor for a subsequent calendar 
                year.
                    ``(B) Form and manner of submission.--
                            ``(i) In general.--Subject to clause (ii), 
                        each community mental health center providing 
                        partial hospitalization services shall submit 
                        to the Secretary data on measures selected 
                        under this paragraph in a form and manner, and 
                        at a time, specified by the Secretary for 
                        purposes of this paragraph.
                            ``(ii) Grace period for submission in 
                        2011.--In the case of such data submitted with 
                        respect to 2011, the Secretary shall provide 
                        for a 30-day grace period for the submission of 
                        such data by a community mental health center 
                        providing partial hospitalization services.
                    ``(C) Development of measures.--
                            ``(i) In general.--The Secretary shall 
                        select measures that the Secretary determines 
                        appropriate for the measurement of the quality 
                        of care provided by community mental health 
                        centers providing partial hospitalization 
                        services, including, beginning with 2011, 
                        measures for a set of 5 indicators established 
                        by the Secretary.
                            ``(ii) Additional measures.--The Secretary 
                        shall expand, beyond the measures selected 
                        under clause (i) and consistent with the 
                        succeeding provisions of this paragraph, the 
                        set of measures that the Secretary determines 
                        appropriate for the measurement of the quality 
                        of care provided by community mental health 
                        centers providing partial hospitalization 
                        services.
                            ``(iii) Consensus measures.--Beginning with 
                        2009, the Secretary shall add additional 
                        measures that reflect consensus among affected 
                        parties and, to the extent feasible and 
                        practicable, shall include measures set forth 
                        by 1 or more national consensus building 
                        entities.
                    ``(D) Replacement of measures.--For purposes of 
                this paragraph, the Secretary may replace any measures 
                or indicators in appropriate cases, such as where all 
                community mental health centers providing partial 
                hospitalization services are effectively in compliance 
                or the measures or indicators have been subsequently 
                shown not to represent the best clinical practice.
                    ``(E) Availability of data.--The Secretary shall 
                establish procedures for making data submitted under 
                this paragraph available to the public. Such procedures 
                shall ensure that a community mental health center 
                providing partial hospitalization services has the 
                opportunity to review the data that are to be made 
                public with respect to the community mental health 
                center prior to such data being made public. The 
                Secretary shall report quality measures of process, 
                structure, outcome, patients' perspectives on care, 
                efficiency, and costs of care that relate to partial 
                hospitalization services on the Internet website of the 
                Centers for Medicare & Medicaid Services.''.

SEC. 5. ESTABLISHING MINIMUM NUMBER OF SERVICE UNITS.

    (a) In General.--Section 1861(ff)(3)(A) of the Social Security Act 
(42 U.S.C. 1395x(ff)(3)(A)) is amended--
            (1) by striking ``, and'' and inserting a comma; and
            (2) by inserting before the period at the end ``, and which 
        provides a minimum of 4 units of items and services described 
        in paragraph (2)''.
    (b) Effective Date.--The amendments made by this section shall take 
effect on January 1, 2011.

SEC. 6. COST-REPORTS OF PROVIDERS OF PARTIAL HOSPITALIZATION SERVICES.

    (a) In General.--The Secretary shall require fiscal intermediaries 
under the Medicare program under title XVIII of the Social Security Act 
to file the cost reports of providers of partial hospitalization 
services (as defined in section 1861(ff)(1) of the Social Security Act 
(42 U.S.C. 1395x(ff)(1)) into the Healthcare Provider Cost Reporting 
Information System (HCRIS) maintained by the Centers for Medicare & 
Medicaid Services.
    (b) Funding.--Out of any funds in the Treasury not otherwise 
appropriated, there are appropriated $1,000,000 to the Secretary of 
Health and Human Services for calendar year 2009 to carry out this 
section.