SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Medicare Care Transitions Program 
Act of 2009''.

SEC. 2. MEDICARE CARE TRANSITIONS PROGRAM.

    Title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.) is 
amended by adding at the end the following new section:

                       ``care transitions program

    ``Sec. 1899.  (a) Program.--
            ``(1) In general.--The Secretary shall establish a Care 
        Transitions Program (in this section referred to as the 
        `Program') under which outcomes-based payments are made to 
        community-based transitional care suppliers (in this section 
        referred to as `CTCs') for furnishing care transition services, 
        improving quality of care, and reducing rehospitalization 
        rates.
            ``(2) Care transition services.--For purposes of this 
        section, the term `care transition services' means the 
        following services furnished to individuals entitled to, or 
        enrolled for, benefits under part A or enrolled for benefits 
        under part B after the individual is discharged from inpatient 
        care:
                    ``(A) Self-management goal-setting.
                    ``(B) Medication self-management support.
                    ``(C) Arrangement of timely follow-up care.
                    ``(D) Individualized training in management of 
                clinical exacerbation.
                    ``(E) Establishment and maintenance of a paper or 
                electronic personal health record. Such personal health 
                record shall be written and formatted using language 
                that is easily understandable by individuals receiving 
                benefits under this title.
                    ``(F) Preparation for anticipated clinical 
                encounters.
                    ``(G) Monitoring of service effectiveness, 
                including measures of transitional care as endorsed by 
                the National Quality Forum and hospital readmission 
                rates.
                    ``(H) Other services determined appropriate by the 
                Secretary.
            ``(3) Targeting and timing of care transition services.--
        Care transition services may only be provided--
                    ``(A) to an individual entitled to, or enrolled 
                for, benefits under part A or enrolled for benefits 
                under part B who is part of the targeted beneficiary 
                population under the CTC's plan (as described in 
                subsection (b)(2)(E)) that is approved by the 
                Secretary; and
                    ``(B) during the 90-day period beginning with the 
                day such individual is discharged from a 
                hospitalization.
    ``(b) Contracts With CTCs.--
            ``(1) In general.--Under the program, the Secretary shall 
        establish a process for awarding contracts to entities meeting 
        the requirements of paragraph (2).
            ``(2) Requirements for ctcs.--The Secretary shall establish 
        an application process by which entities seeking contracts to 
        serve as CTCs demonstrate that they meet the following 
        requirements:
                    ``(A) The entity is recognized by the Secretary as 
                having the appropriate professional expertise, 
                safeguards for privacy and confidentiality, and 
                authority to review medical records in order to review 
                cases and identify patterns of care involving items and 
                services furnished to individuals entitled to, or 
                enrolled for, benefits under part A or enrolled for 
                benefits under part B.
                    ``(B) The entity does not currently receive 
                payments for items or services furnished to individuals 
                described in subparagraph (A).
                    ``(C) The entity has the demonstrated capability to 
                form cooperative processes with providers of medical 
                services through local community presence and other 
                characteristics.
                    ``(D) The entity has received appropriate formal 
                training and demonstrates other evidence of its 
                capability to deliver care transition services.
                    ``(E) The entity submits a proposed plan that 
                identifies a carefully selected target beneficiary 
                population, particularly those most at risk for 
                rehospitalizations, for which the entity will provide 
                care transition services, identifies targeted 
                inappropriate or wasteful services contributing to 
                preventable rehospitalizations, and identifies any 
                targeted disparities in the quality of care transitions 
                associated with race, ethnicity, language, or gender.
            ``(3) Intervention.--Under the contract awarded under this 
        subsection, a CTC shall undertake community-based 
        interventions, including the following:
                    ``(A) Partner with local entities designated under 
                section 3025(a)(2)(A) of the Older Americans Act of 
                1965, and such other individuals and organizations as 
                the CTC may recruit for the purposes of this section, 
                to develop and implement an intervention plan. Such 
                plan shall be aimed at reducing rehospitalizations and 
                improving quality outcomes among the individuals 
                served. Throughout the intervention period, the CTC 
                shall be accountable for ongoing project management and 
                facilitation. The CTC shall assist providers and the 
                community in creating resources for more effective 
                transitions and in implementing improvement activities.
                    ``(B) Review cases involving items and services 
                provided to individuals entitled to, or enrolled for, 
                benefits under part A or enrolled for benefits under 
                part B who have been rehospitalized within 30 days of 
                discharge from an inpatient hospital stay.
                    ``(C) Engage providers and practitioners in 
                interventions to identify and eliminate the causes of 
                preventable rehospitalizations.
                    ``(D) Engage partners to implement care transition 
                services which primarily target individuals served who 
                have complex conditions according to the needs, 
                structures, and hospital readmissions patterns of the 
                local community.
            ``(4) Deidentified patient data.--Notwithstanding any other 
        provision of law, the CTC may, as determined appropriate by the 
        CTC, provide to providers and practitioners consenting to 
        participate in an intervention deidentified patient data that 
        identifies providers and practitioners treating the same 
        population of patients, for the purpose of measuring and 
        improving the safety, quality, and effectiveness of transitions 
        of such patients from the care of one provider or practitioner 
        to another. Nothing in this paragraph shall be construed to 
        limit, alter, or affect the requirements imposed by section 
        264(c) of the Health Insurance Portability and Accountability 
        Act of 1996.
            ``(5) Reports.--Under the contract awarded under this 
        subsection, a CTC shall submit to the Secretary reports (in 
        such frequency determined appropriate by the Secretary) on the 
        implementation of the requirements under the contract.
    ``(c) Payments to CTCs.--
            ``(1) In general.--Under the Program, the Secretary shall 
        establish payment amounts for organizations awarded a contract 
        under this section. Such payment amounts shall be directly 
        linked to the ability of the CTC to achieve or exceed quality 
        and cost targets, including a shared savings payment for 
        demonstrated reductions in the expected rehospitalization rate 
        for individuals receiving care from the CTC.
            ``(2) Adjustment.--The Secretary shall make appropriate 
        adjustments to payments to CTCs under this section to take into 
        account adverse selection of individuals and the variation in 
        the health status of individuals among CTCs, including high 
        cost outliers. Such adjustments shall be made in a budget-
        neutral manner.
            ``(3) Trust funds.--Payments to CTCs under this section 
        shall be payable from--
                    ``(A) funds in the Federal Hospital Insurance Trust 
                Fund; and
                    ``(B) funds in the Federal Supplementary Medical 
                Insurance Trust Fund,
        in such proportion as the Secretary shall deem to be fair and 
        equitable after taking into consideration the quality 
        improvements and cost savings achieved by such entities.
    ``(d) Regulations.--The Secretary shall promulgate regulations to 
carry out this section. Such regulations shall be promulgated by not 
later than 18 months after the date of enactment of this section.''.
Medicare Care Transitions Program Act of 2009 - Amends title XVIII (Medicare) of the Social Security Act to direct the Secretary of Health and Human Services to establish a Care Transitions Program under which outcomes-based payments are made to community-based transitional care (CTC) suppliers for: (1) furnishing care transition services to an individual after discharge from inpatient care; (2) improving quality of care; and (3) reducing rehospitalization rates.
A bill to amend title XVIII of the Social Security Act to establish a Care Transitions Program in order to improve quality and cost-effectiveness of care for Medicare beneficiaries.