SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Medicare Beneficiary Freedom To 
Contract Act of 1997''.

SEC. 2. USE OF PRIVATE CONTRACTS BY MEDICARE BENEFICIARIES FOR 
              PROFESSIONAL SERVICES.

    (a) In General.--Section 1802 of the Social Security Act (42 U.S.C. 
1395a) is amended by striking subsection (b), as added by section 
4507(a) of the Balanced Budget Act of 1997 (Public Law 105-33), and 
inserting the following:
    ``(b) Clarification of Use of Private Contracts by Medicare 
Beneficiaries for Professional Services.--
            ``(1) In general.--Nothing in this title shall prohibit a 
        medicare beneficiary from entering into a private contract with 
        a physician or health care practitioner for the provision of 
        medicare covered professional services (as defined in paragraph 
        (5)(C)) if--
                    ``(A) the services are covered under a private 
                contract that is between the beneficiary and the 
                physician or practitioner and meets the requirements of 
                paragraph (2);
                    ``(B) under the private contract no claim for 
                payment for services covered under the contract is to 
                be submitted (and no payment made) under part A or B, 
                under a contract under section 1876, or under a 
                Medicare+Choice plan (other than an MSA plan); and
                    ``(C)(i) the Secretary has been provided with the 
                minimum information necessary to avoid any payment 
                under part A or B for services covered under the 
                contract, or
                    ``(ii) in the case of an individual enrolled under 
                a contract under section 1876 or a Medicare+Choice plan 
                (other than an MSA plan) under part C, the eligible 
                organization under the contract or the Medicare+Choice 
                organization offering the plan has been provided the 
                minimum information necessary to avoid any payment 
                under such contract or plan for services covered under 
                the contract.
            ``(2) Requirements for private contracts.--The requirements 
        in this paragraph for a private contract between a medicare 
        beneficiary and a physician or health care practitioner are as 
        follows:
                    ``(A) General form of contract.--The contract is in 
                writing and is signed by the medicare beneficiary.
                    ``(B) No claims to be submitted for covered 
                services.--The contract provides that no party to the 
                contract (and no entity on behalf of any party to the 
                contract) shall submit any claim for (or request) 
                payment for services covered under the contract under 
                part A or B, under a contract under section 1876, or 
                under a Medicare+Choice plan (other than an MSA plan).
                    ``(C) Scope of services.--The contract identifies 
                the medicare covered professional services and the 
                period (if any) to be covered under the contract, but 
                does not cover any services furnished--
                            ``(i) before the contract is entered into; 
                        or
                            ``(ii) for the treatment of an emergency 
                        medical condition (as defined in section 
                        1867(e)(1)(A)), unless the contract was entered 
                        into before the onset of the emergency medical 
                        condition.
                    ``(D) Clear disclosure of terms.--The contract 
                clearly indicates that by signing the contract the 
                medicare beneficiary--
                            ``(i) agrees not to submit a claim (or to 
                        request that anyone submit a claim) under part 
                        A or B (or under section 1876 or under a 
                        Medicare+Choice plan, other than an MSA plan) 
for services covered under the contract;
                            ``(ii) agrees to be responsible, whether 
                        through insurance or otherwise, for payment for 
                        such services and understands that no 
                        reimbursement will be provided under such part, 
                        contract, or plan for such services;
                            ``(iii) acknowledges that no limits under 
                        this title (including limits under paragraph 
                        (1) and (3) of section 1848(g)) will apply to 
                        amounts that may be charged for such services;
                            ``(iv) acknowledges that medicare 
                        supplemental policies under section 1882 do 
                        not, and other supplemental health plans and 
                        policies may elect not to, make payments for 
                        such services because payment is not made under 
                        this title; and
                            ``(v) acknowledges that the beneficiary has 
                        the right to have such services provided by (or 
                        under the supervision of) other physicians or 
                        health care practitioners for whom payment 
                        would be made under such part, contract, or 
                        plan.
                Such contract shall also clearly indicate whether the 
                physician or practitioner involved is excluded from 
                participation under this title.
            ``(3) Modifications.--The parties to a private contract may 
        mutually agree at any time to modify or terminate the contract 
        on a prospective basis, consistent with the provisions of 
        paragraphs (1) and (2).
            ``(4) No requirements for services furnished to msa plan 
        enrollees.--The requirements of paragraphs (1) and (2) do not 
        apply to any contract or arrangement for the provision of 
        services to a medicare beneficiary enrolled in an MSA plan 
        under part C.
            ``(5) Definitions.--In this subsection:
                    ``(A) Health care practitioner.--The term `health 
                care practitioner' means a practitioner described in 
                section 1842(b)(18)(C).
                    ``(B) Medicare beneficiary.--The term `medicare 
                beneficiary' means an individual who is enrolled under 
                part B.
                    ``(C) Medicare covered professional services.--The 
                term `medicare covered professional services' means--
                            ``(i) physicians' services (as defined in 
                        section 1861(q), and including services 
                        described in section 1861(s)(2)(A)), and
                            ``(ii) professional services of health care 
                        practitioners, including services described in 
                        section 1842(b)(18)(D),
                for which payment may be made under part A or B, under 
                a contract under section 1876, or under a 
                Medicare+Choice plan but for the provisions of a 
                private contract that meets the requirements of 
                paragraph (2).
                    ``(D) Medicare+choice plan; msa plan.--The terms 
                `Medicare+Choice plan' and `MSA plan' have the meanings 
                given such terms in section 1859.
                    ``(E) Physician.--The term `physician' has the 
                meaning given such term in section 1861(r).''.
    (b) Conforming Amendments Clarifying Exemption From Limiting Charge 
and From Requirement for Submission of Claims.--Section 1848(g) of the 
Social Security Act (42 U.S.C. 1395w-4(g)) is amended--
            (1) in paragraph (1)(A), by striking ``In'' and inserting 
        ``Subject to paragraph (8), in'';
            (2) in paragraph (3)(A), by striking ``Payment'' and 
        inserting ``Subject to paragraph (8), payment'';
            (3) in paragraph (4)(A), by striking ``For'' and inserting 
        ``Subject to paragraph (8), for''; and
            (4) by adding at the end the following new paragraph:
            ``(8) Exemption from requirements for services furnished 
        under private contracts.--
                    ``(A) In general.--Pursuant to section 1802(b)(1), 
                paragraphs (1), (3), and (4) do not apply with respect 
                to physicians' services (and services described in 
                section 1861(s)(2)(A)) furnished to an individual by 
                (or under the supervision of) a physician if the 
                conditions described in section 1802(b)(1) are met with 
                respect to the services.
                    ``(B) No restrictions for enrollees in msa plans.--
                Such paragraphs do not apply with respect to services 
                furnished to individuals enrolled with MSA plans under 
                part C, without regard to whether the conditions 
                described in subparagraphs (A) through (C) of section 
                1802(b)(1) are met.
                    ``(C) Application to enrollees in other plans.--
                Subject to subparagraph (B) and section 1852(k)(2), the 
                provisions of subparagraph (A) shall apply in the case 
                of an individual enrolled under a contract under 
                section 1876 or under a Medicare+Choice plan (other 
                than an MSA plan) under part C, in the same manner as 
                they apply to individuals not enrolled under such a 
                contract or plan.''.
    (c) Conforming Amendments.--
            (1) Section 1842(b)(18) of the Social Security Act (42 
        U.S.C. 1395u(b)(18)) is amended by adding at the end the 
        following:
    ``(E) The provisions of section 1848(g)(8) shall apply with respect 
to exemption from limitations on charges and from billing requirements 
for services of health care practitioners described in this paragraph 
in the same manner as such provisions apply to exemption from the 
requirements referred to in section 1848(g)(8)(A) for physicians' 
services.''.
            (2) Section 1866(a)(1)(O) of such Act (42 U.S.C. 
        1395cc(a)(1)(O)), as amended by section 4002(e) of the Balanced 
        Budget Act of 1997, is amended by inserting ``(other than under 
        an MSA plan)'' after ``Medicare+Choice organization under part 
        C''.
            (3) Section 4507(b) of the Balanced Budget Act of 1997 
        (Public Law 105-33; 111 Stat. 441) is amended--
                    (A) in the matter before paragraph (1), by striking 
                ``on the program under this title of private contracts 
                entered into under the amendment made by subsection 
                (a)'' and inserting ``on title XVIII of the Social 
                Security Act of private contracts permitted under 
                section 1802(b) of such Act''; and
                    (B) in paragraph (2), by striking ``section 1802(b) 
                of such Act (as added by subsection (a))'' and 
                inserting ``such section''.
    (d) Effective Date.--The amendments made by this section shall be 
effective as if included in the enactment of section 4507 of the 
Balanced Budget Act of 1997.
Medicare Beneficiary Freedom To Contract Act of 1997 - Amends title XVIII (Medicare) of the Social Security Act to revise provisions added by the Balanced Budget Act of 1997 regarding the use of private contracts by Medicare beneficiaries for professional services. Outlines specific requirements for private contracts between Medicare beneficiaries and physicians or health care practitioners for services for which no Medicare claims may be submitted.
Medicare Beneficiary Freedom To Contract Act of 1997