To reauthorize the Children's Hospitals Graduate Medical Education Program.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Children's Hospitals Education 
Equity and Research (CHEER) Act of 2004''.

SEC. 2. REAUTHORIZATION OF CHILDREN'S HOSPITALS GRADUATE MEDICAL 
              EDUCATION PROGRAM.

    (a) Extension of Program.--Section 340E(a) of the Public Health 
Service Act (42 U.S.C. 256e(a)) is amended by striking ``2005'' and 
inserting ``2010''.
    (b) Description of Amount of Payments.--Section 340E(b) of the 
Public Health Service Act (42 U.S.C. 256e(b)) is amended--
            (1) in paragraph (1)(B), by striking ``relating to teaching 
        residents in such'' and inserting ``associated with graduate 
        medical residency training''; and
            (2) in paragraph (2)(A), by inserting before the period at 
        the end ``, except that for purposes of this paragraph such 
        total excludes amounts that remain available from a previous 
        fiscal year under paragraph (1)(B) or (2)(B) of subsection 
        (f)''.
    (c) Direct Graduate Medical Education.--Section 340E(c) of the 
Public Health Service Act (42 U.S.C. 256e(c)) is amended--
            (1) in paragraph (1)--
                    (A) in the matter preceding subparagraph (A), by 
                striking ``product'' and inserting ``sum'';
                    (B) in subparagraph (A), by striking ``(A) the 
                updated per resident'' and inserting the following:
                    ``(A) the product of--
                            ``(i) the updated per resident'';
                    (C) by redesignating subparagraph (B) as clause 
                (ii) and indenting appropriately;
                    (D) in subparagraph (A)(ii) (as so redesignated)--
                            (i) by inserting ``, but without giving 
                        effect to section 1886(h)(7) of such Act)'' 
                        after ``section 1886(h)(4) of the Social 
                        Security Act''; and
                            (ii) by striking the period and inserting 
                        ``; and''; and
                    (E) by inserting after subparagraph (A) the 
                following:
                    ``(B) amounts for other approved education programs 
                that are provider-operated, as defined for purposes of 
                Medicare payment, limited to not more than 30 percent 
                of costs that would be allowed for such programs under 
                Medicare rules for hospitals reimbursed under section 
                1886(d) of the Social Security Act.''; and
            (2) in paragraph (2)(B), by inserting before the period at 
        the end ``, without giving effect to section 1886(d)(3)(E)(ii) 
        of the Social Security Act''.
    (d) Indirect Graduate Medical Education.--Section 340E(d) of the 
Public Health Service Act (42 U.S.C. 256e(d)) is amended--
            (1) in paragraph (1), by striking ``related to'' and 
        inserting ``associated with''; and
            (2) in paragraph (2)(A)--
                    (A) by inserting ``ratio of the'' after ``hospitals 
                and the''; and
                    (B) by inserting at the end before the semicolon 
                ``to beds (but excluding beds or bassinets assigned to 
                healthy newborn infants)''.
    (e) Nature of Payments.--Section 340E(e) of the Public Health 
Service Act (42 U.S.C. 256e(e)) is amended--
            (1) in paragraph (2), by striking the first sentence;
            (2) in paragraph (3), by striking ``recoup any overpayments 
        made to pay any balance due to the extent possible'' and all 
        that follows through the end of the paragraph and inserting the 
        following: ``recoup any overpayments made and pay any balance 
        due. To the greatest extent possible, amounts recouped from a 
        hospital are to be distributed to other hospitals in the same 
        fiscal year. Amounts recouped from a hospital and not disbursed 
        to other hospitals in the same fiscal year shall remain 
        available for distribution during the subsequent fiscal year. 
        Unless there is fraud, amounts paid to a hospital without a 
        demand for recoupment by the end of the fiscal year shall be 
        final and not subject to recoupment.''; and
            (3) by adding at the end the following:
            ``(4) Appeals.--
                    ``(A) In general.--A decision affecting the amount 
                payable to a hospital pursuant to this section shall--
                            ``(i) be subject to review under section 
                        1878 of the Social Security Act in the same 
                        manner as final determinations of a fiscal 
                        intermediary of the amount of payment under 
                        section 1886(d) of such Act are subject to 
                        review; and
                            ``(ii) be handled expeditiously so that the 
                        review decision is reflected in the final 
                        reconciliation for the year in which the appeal 
                        is made.
                    ``(B) Limitation.--A review decision pursuant to 
                this section shall not affect payments for a fiscal 
                year prior to the fiscal year in which the review 
                decision is rendered.
                    ``(C) Application to subsequent fiscal years.--The 
                Secretary shall apply a review decision in determining 
                the amount of payment for the appealing hospital in the 
                fiscal year in which the decision is rendered and in 
                subsequent years, unless the law at issue in the review 
                decision is amended or there are material differences 
                between the facts for the fiscal year for which the 
                review decision is rendered and the year for which 
                payment is made. Nothing in this section shall be 
                construed to prohibit a hospital from appealing similar 
                determinations in subsequent periods.''.
    (f) Authorization of Appropriations.--Section 340E(f) of the Public 
Health Service Act (42 U.S.C. 256e(f)) is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (A)--
                            (i) in clause (ii), by striking ``and'';
                            (ii) in clause (iii), by striking the 
                        period at the end and inserting a semicolon; 
                        and
                            (iii) by adding at the end the following:
                            ``(iv) for fiscal year 2006, $110,000,000; 
                        and
                            ``(v) for each of fiscal years 2007 through 
                        2010, such sums as may be necessary, including 
                        an annual adjustment to reflect increases in 
                        the Consumer Price Index.''; and
                    (B) in subparagraph (B), by striking ``for fiscal 
                year 2000'' and all that follows and inserting ``for 
                fiscal year 2006 and each subsequent fiscal year shall 
                remain available for obligation for the year 
                appropriated and the subsequent fiscal year.''; and
            (2) in paragraph (2)--
                    (A) by redesignating subparagraphs (A), (B), and 
                (C) as clauses (i), (ii), and (iii), respectively, and 
                indenting appropriately;
                    (B) by striking ``There are hereby authorized'' and 
                inserting the following:
                    ``(A) In general.--There are authorized'';
                    (C) in clause (ii) (as redesignated by this 
                paragraph), by striking ``and'';
                    (D) in clause (iii) (as redesignated by this 
                paragraph), by striking the period at the end and 
                inserting a semicolon;
                    (E) by adding at the end of subparagraph (A) (as 
                designated by this paragraph), the following:
                            ``(iv) for fiscal year 2006, $220,000,000; 
                        and
                            ``(v) for each of fiscal years 2007 through 
                        2010, such sums as may be necessary, including 
                        an annual adjustment to reflect increases in 
                        the Consumer Price Index.''; and
                    (F) at the end of paragraph (2), by adding the 
                following:
                    ``(B) Carryover of excess.--To the extent that 
                amounts are not expended in the year for which they are 
                appropriated, the amounts appropriated under 
                subparagraph (A) for fiscal year 2006 and each 
                subsequent fiscal year shall remain available for 
                obligation through the end of the following fiscal 
                year.''.
    (g) Definitions.--Paragraph (3) of section 340E(g) of the Public 
Health Service Act (42 U.S.C. 256e(g)) is amended by striking ``has'' 
and all that follows through the end of the sentence and inserting ``--
                    ``(A) has the meaning given such term in section 
                1886(h)(5)(C) of the Social Security Act; and
                    ``(B) includes costs of approved educational 
                activities, as such term is used in section 1886(a)(4) 
                of the Social Security Act.''.

Summary: Children's Hospitals Education Equity and Research (CHEER) Act of 2004 - Amends the Public Health Service Act to require the Secretary of Health and Human Services to make payments through FY 2010 to children's hospitals for costs associated with operating approved graduate medical resident training programs.