To amend title XVIII of the Social Security Act to modernize payments for ambulatory surgical centers under the Medicare Program.

Summary: Ambulatory Surgical Center Medicare Payment Modernization Act of 2005 - Amends title XVIII (Medicare) of the Social Security Act to revise the requirements and the formula for payments for services furnished to individuals in ambulatory surgical centers.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Ambulatory Surgical Center Medicare 
Payment Modernization Act of 2005''.

SEC. 2. MEDICARE PAYMENT FOR AMBULATORY SURGICAL CENTER SERVICES.

    (a) In General.--Section 1833(i) of the Social Security Act (42 
U.S.C. 1395l(i)) is amended to read as follows:
    ``(i)(1) Payment shall be made under this part in the amount 
specified under paragraph (2) for facility services furnished to an 
individual in an ambulatory surgical center in connection with any 
outpatient surgical procedure covered under this part as a hospital 
outpatient department service, except for those procedures that the 
Secretary designates, in consultation with appropriate trade and 
professional organizations (including those having direct experience 
with ambulatory surgical centers) as posing a significant safety risk 
or requiring an overnight stay when performed in ambulatory surgical 
centers. Not less frequently than once every two years the Secretary 
shall review and, may, after public comment, make appropriate 
adjustments to this list of procedures excluded from coverage when 
performed in ambulatory surgical centers as the Secretary deems 
necessary.
    ``(2)(A) Subject to subparagraphs (B) and (C), the amount of 
payment to be made under this subsection for facility services 
furnished to an individual in an ambulatory surgical center in 
accordance with paragraph (1) shall be equal to 75 percent of the fee 
schedule amount determined under paragraph (3)(A) of subsection (t) for 
payment of the same service furnished in hospital outpatient 
departments, as adjusted under paragraphs (4)(A), (6), and (15) of such 
subsection, less a 20 percent beneficiary copayment.
    ``(B) For covered ambulatory surgical center services furnished on 
or after January 1, 2008, and before January 1, 2012, for which the 
ambulatory surgical center payment amount payable under this subsection 
in 2007 (in this subsection referred to as the `2007 ASC payment 
amount') is less than 75 percent of the hospital OPD fee schedule 
amount under subsection (t) in 2007 for the same services, the amount 
of payment under this subsection shall be calculated as follows:
            ``(i) For services furnished during 2008, the amount shall 
        be equal to the sum of--
                    ``(I) 80 percent of the 2007 ASC payment amount, as 
                increased by the percentage increase in the consumer 
                price index for all urban consumers (United States city 
                average) as estimated by the Secretary for the 12-month 
                period ending with December 31, 2006; and
                    ``(II) 20 percent of the payment amount under 
                paragraph (2)(A) for 2008.
            ``(ii) For services furnished during 2009, the amount shall 
        be equal to the sum of--
                    ``(I) 60 percent of the 2007 ASC payment amount as 
                increased under clause (i)(I) and as further increased 
                by the percentage increase in the consumer price index 
                for all urban consumers (United States city average) as 
                estimated by the Secretary for the 12-month period 
                ending with December 31, 2007; and
                    ``(II) 40 percent of the payment amount under 
                paragraph (2)(A) for 2009.
            ``(iii) For services furnished during 2010, the amount 
        shall be equal to the sum of--
                    ``(I) 40 percent of the 2007 ASC payment amount as 
                increased under clauses (i)(I) and (ii)(I) and as 
                further increased by the percentage increase in the 
                consumer price index for all urban consumers (United 
                States city average) as estimated by the Secretary for 
                the 12-month period ending with December 31, 2008; and
                    ``(II) 60 percent of the payment amount under 
                paragraph (2)(A) for 2010.
            ``(iv) For services furnished during 2011, the amount shall 
        be equal to the sum of--
                    ``(I) 20 percent of the 2007 ASC payment amount as 
                increased under clauses (i)(I), (ii)(I), and (iii)(I) 
                and as further increased by the percentage increase in 
                the consumer price index for all urban consumers 
                (United States city average) as estimated by the 
                Secretary for the 12-month period ending with December 
                31, 2009; and
                    ``(II) 80 percent of the payment amount under 
                paragraph (2)(A) for 2011.
    ``(C) For covered ambulatory surgical center services for which the 
2007 ASC payment amount is--
            ``(i) greater than 75 percent, but less than 100 percent, 
        of the hospital OPD fee schedule amount under subsection (t) in 
        2007 for the same services, the amount of payment under this 
        subsection shall be the greater of the 2007 ASC payment amount 
        or--
                    ``(I) for services furnished in 2008, the payment 
                amount under subparagraph (B)(i);
                    ``(II) for services furnished in 2009, the payment 
                amount under subparagraph (B)(ii);
                    ``(III) for services furnished in 2010, the payment 
                amount under subparagraph (B)(iii);
                    ``(IV) for services furnished in 2011, the payment 
                amount under subparagraph (B)(iv); or
                    ``(V) in 2012 and subsequent years, the payment 
                amount under subparagraph (A),
        but in no case in excess of the then applicable hospital OPD 
        fee schedule amount; or
            ``(ii) greater than the hospital OPD fee schedule amount 
        under subsection (t) in 2007 for the same services, the amount 
        of payment under this subsection--
                    ``(I) for services furnished during 2008, is equal 
                to the midpoint between the 2007 ASC payment amount and 
                100 percent of such 2007 hospital OPD fee schedule 
                amount; or
                    ``(II) for services furnished in a subsequent year 
                is equal to the greater of the 2007 hospital OPD fee 
                schedule amount or the payment amount specified under 
                subclause (I) through (V) of clause (i) for the year 
                involved, but but in no case in excess of the then 
                applicable hospital OPD fee schedule amount.''.
    (b) Conforming Amendments.--
            (1) Section 1832(a)(2)(F)(i) of such Act (42 U.S.C. 
        1395k(a)(2)(F)(i)) is amended--
                    (A) by striking ``section 1833(i)(1)(A)'' and 
                inserting ``section 1833(i)(1)'';
                    (B) by striking ``the standard overhead amount as 
                determined under section 1833(i)(2)(A)'' and inserting 
                ``the amount determined under section 1833(i)(2)''; and
                    (C) by striking all that follows ``as full payment 
                for such services'' and inserting ``, or''.
            (2) Section 1833(a)(1)(G) of such Act (42 U.S.C. 
        1395l(a)(1)(G)) is amended--
                    (A) by striking ``subsection (i)(1)(A)'' and 
                inserting ``subsection (i)(1)'';
                    (B) by striking ``for services furnished 
                beginning'' and all that follows through ``subsection 
                (i)(2)(D)''; and
                    (C) by striking ``such revised payment system'' and 
                inserting ``under subsection (i)(2)''.
            (3) Section 1833(a)(4) of such Act (42 U.S.C. 1395l(a)(4)) 
        is amended--
                    (A) by striking ``section 1833(i)(1)(A)'' and 
                inserting ``subsection (i)(1)''; and
                    (B) by striking ``paragraph (2) or (3) of 
                subsection (i)'' and inserting ``subsection (i)(1)''.
    (c) Effective Date.--The amendments made by this section shall 
apply to ambulatory surgical center services furnished on or after 
January 1, 2008.