II

106TH CONGRESS

1ST SESSION S. 1024

To amend title XVIII of the Social Security Act to carve out from payments

to Medicare+Choice organizations amounts attributable to disproportionate share hospital payments and pay such amounts directly to those

disproportionate share hospitals in which their enrollees receive care.

IN THE SENATE OF THE UNITED STATES

MAY 12, 1999

Mr. MOYNIHAN (for himself, Mr. SCHUMER, Mr. SPECTER, Mr. KERRY, Mr.

KERREY, Mr. SANTORUM, Mr. DURBIN, Mr. CLELAND, and Mr. CHAFEE)

introduced the following bill; which was read twice and referred to the

Committee on Finance

A BILL

To amend title XVIII of the Social Security Act to carve

out from payments to Medicare+Choice organizations

amounts attributable to disproportionate share hospital

payments and pay such amounts directly to those disproportionate share hospitals in which their enrollees receive care.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Managed Care Fair

5 Payment Act of 1999’’.
2

•S 1024 IS

1 SEC. 2. CARVING OUT DSH PAYMENTS FROM PAYMENTS TO

2 MEDICARE+CHOICE ORGANIZATIONS AND

3 PAYING THE AMOUNTS DIRECTLY TO DSH

4 HOSPITALS ENROLLING MEDICARE+CHOICE

5 ENROLLEES.

6 (a) IN GENERAL.—Section 1853(c)(3) of the Social

7 Security Act (42 U.S.C. 1395w–23(c)(3)) is amended—

8 (1) in subparagraph (A), by striking ‘‘subpara9 graph (B)’’ and inserting ‘‘subparagraphs (B) and

10 (D)’’;

11 (2) by redesignating subparagraph (D) as sub12 paragraph (E); and

13 (3) by inserting after subparagraph (C) the fol14 lowing:

15 ‘‘(D) REMOVAL OF PAYMENTS ATTRIB16 UTABLE TO DISPROPORTIONATE SHARE PAY17 MENTS FROM CALCULATION OF ADJUSTED AV18 ERAGE PER CAPITA COST.—

19 ‘‘(i) IN GENERAL.—In determining

20 the area-specific Medicare+Choice capita21 tion rate under subparagraph (A) for a

22 year (beginning with 2001), the annual per

23 capita rate of payment for 1997 deter24 mined under section 1876(a)(1)(C) shall be

25 adjusted, subject to clause (ii), to exclude

26 from the rate the additional payments that
3

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1 the Secretary estimates were made during

2 1997 for additional payments described in

3 section 1886(d)(5)(F).

4 ‘‘(ii) TREATMENT OF PAYMENTS COV5 ERED UNDER STATE HOSPITAL REIM6 BURSEMENT SYSTEM.—To the extent that

7 the Secretary estimates that an annual per

8 capita rate of payment for 1997 described

9 in clause (i) reflects payments to hospitals

10 reimbursed under section 1814(b)(3), the

11 Secretary shall estimate a payment adjust12 ment that is comparable to the payment

13 adjustment that would have been made

14 under clause (i) if the hospitals had not

15 been reimbursed under such section.’’.

16 (b) ADDITIONAL PAYMENTS FOR MANAGED CARE

17 ENROLLEES.—Section 1886(d)(5)(F) of the Social Secu18 rity Act (42 U.S.C. 1395ww(d)(5)(F)) is amended—

19 (1) in clause (ii), by striking ‘‘clause (ix)’’ and

20 inserting ‘‘clauses (ix) and (x)’’; and

21 (2) by adding at the end the following:

22 ‘‘(x)(I) For portions of cost reporting periods occur23 ring on or after January 1, 2001, the Secretary shall pro24 vide for an additional payment amount for each applicable
4

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1 discharge of any subsection (d) hospital that is a dis2 proportionate share hospital (as described in clause (i)).

3 ‘‘(II) For purposes of this clause, the term ‘applicable

4 discharge’ means the discharge of any individual who is

5 enrolled with a Medicare+Choice organization under part

6 C.

7 ‘‘(III) The amount of the payment under this clause

8 with respect to any applicable discharge shall be equal to

9 the estimated average per discharge amount (as deter10 mined by the Secretary) that would otherwise have been

11 paid under this subparagraph if the individual had not

12 been enrolled as described in subclause (II).

13 ‘‘(IV) The Secretary shall establish rules for an addi14 tional payment amount for any hospital reimbursed under

15 a reimbursement system authorized under section

16 1814(b)(3) if such hospital would qualify as a dispropor17 tionate share hospital under clause (i) were it not so reim18 bursed. Such payment shall be determined in the same

19 manner as the amount of payment is determined under

20 this clause for disproportionate share hospitals.’’.

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