I 

108TH CONGRESS 

1ST SESSION H. R. 1377

To amend title XVIII of the Social Security Act to enhance the access 

of Medicare beneficiaries who live in medically underserved areas to 

critical primary and preventive health care benefits, to improve the 

Medicare+Choice program, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 20, 2003

Mr. WELLER (for himself, Mr. LEWIS of Georgia, Mr. HOUGHTON, Mr. 

MCNULTY, Mr. FARR, Mr. STUPAK, and Mr. HINCHEY) introduced the 

following bill; which was referred to the Committee on Ways and Means, 

and in addition to the Committee on Energy and Commerce, for a period 

to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee 

concerned 

A BILL

To amend title XVIII of the Social Security Act to enhance 

the access of Medicare beneficiaries who live in medically 

underserved areas to critical primary and preventive 

health care benefits, to improve the Medicare+Choice 

program, and for other purposes.

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; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Medicare Safety Net Access Act of 2003’’. 
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1 (b) TABLE OF CONTENTS.—The table of contents of 

2 this Act is as follows:

Sec. 1. Short title; table of contents. 

Sec. 2. Coverage of additional Federally qualified health center services. 

Sec. 3. Providing safe harbor for certain collaborative efforts that benefit medically underserved populations. 

Sec. 4. Supplemental reimbursement for Federally qualified health centers participating in medicare managed care.

3 SEC. 2. DELIVERY OF MEDICARE-COVERED PRIMARY AND 

4 PREVENTIVE SERVICES AT FEDERALLY 

5 QUALIFIED HEALTH CENTERS. 

6 (a) COVERAGE OF MEDICARE-COVERED AMBULA7 TORY SERVICES BY FQHCS.—Section 1861(aa)(3) of the 

8 Social Security Act (42 U.S.C. 1395x(aa)(3)) is amended 

9 to read as follows: 

10 ‘‘(3) The term ‘Federally qualified health center serv11 ices’ means—

12 ‘‘(A) services of the type described in subpara13 graphs (A) through (C) of paragraph (1), and such 

14 other services furnished by a Federally qualified 

15 health center for which payment may otherwise be 

16 made under this title if such services were furnished 

17 by a health care provider or health care professional 

18 other than a Federally qualified health center; and 

19 ‘‘(B) preventive primary health services that a 

20 center is required to provide under section 330 of 

21 the Public Health Service Act, 
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1 when furnished to an individual as a patient of a Federally 

2 qualified health center and such services when provided 

3 by a health care provider or health care professional em4 ployed by or under contract with a Federally qualified 

5 health center shall be treated as billable visits for purposes 

6 of payment to the Federally qualified health center.’’. 

7 (b) ENSURING FQHC REIMBURSEMENT UNDER

8 HOSPITAL AND SKILLED NURSING FACILITY PROSPEC9 TIVE PAYMENT SYSTEMS.—

10 (1) PATIENTS OF HOSPITALS AND CRITICAL AC11 CESS HOSPITALS.—Section 1862(a)(14) of the Social 

12 Security Act (42 U.S.C. 1395y(a)) is amended by 

13 inserting ‘‘Federally qualified health center serv14 ices,’’ after ‘‘qualified psychologist services,’’. 

15 (2) PATIENTS OF SKILLED NURSING FACILI16 TIES.—Section 1888(e)(2)(A) of the Social Security 

17 Act (42 U.S.C. 1395yy(e)(2)(A)) is amended—

18 (A) in clause (i)(II), by striking ‘‘clauses 

19 (ii) and (iii)’’ and inserting ‘‘clauses (ii) 

20 through (iv)’’; and 

21 (B) by adding at the end the following new 

22 clause: 

23 ‘‘(iv) EXCLUSION OF FEDERALLY

24 QUALIFIED HEALTH CENTER SERVICES.—

25 Services described in this clause are Feder-
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1 ally qualified health center services (as de2 fined in section 1861(aa)(3)).’’. 

3 (c) TECHNICAL CORRECTIONS.—Clauses (i) and 

4 (ii)(II) of section 1861(aa)(4)(A) of the Social Security 

5 Act (42 U.S.C. 1395x(aa)(4)(A)) are each amended by 

6 striking ‘‘(other than subsection (h))’’. 

7 (d) EFFECTIVE DATES.—The amendments made—

8 (1) by subsections (a) and (b) shall apply to 

9 services furnished on or after January 1, 2004; and 

10 (2) by subsection (c) shall take effect on the 

11 date of enactment of this Act. 

12 SEC. 3. PROVIDING SAFE HARBOR FOR CERTAIN COLLABO13 RATIVE EFFORTS THAT BENEFIT MEDICALLY 

14 UNDERSERVED POPULATIONS.

15 (a) IN GENERAL.—Section 1128B(b)(3) (42 U.S.C. 

16 1320a–7(b)(3)) is amended—

17 (1) in subparagraph (E), by striking ‘‘and’’ 

18 after the semicolon at the end; 

19 (2) in subparagraph (F), by striking the period 

20 at the end and inserting ‘‘; and’’; and 

21 (3) by adding at the end the following new sub22 paragraph:

23 ‘‘(G) any remuneration between a public or 

24 nonprofit private health center entity described 

25 under clause (i) or (ii) of section 1905(l)(2)(B) 
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1 and any individual or entity providing goods, 

2 items, services, donations or loans, or a com3 bination thereof, to such health center entity 

4 pursuant to a contract, lease, grant, loan, or 

5 other agreement, if such agreement contributes 

6 to the ability of the health center entity to 

7 maintain or increase the availability, or enhance 

8 the quality, of services provided to a medically 

9 underserved population served by the health 

10 center entity.’’. 

11 (b) RULEMAKING FOR EXCEPTION FOR HEALTH

12 CENTER ENTITY ARRANGEMENTS.—

13 (1) ESTABLISHMENT.—

14 (A) IN GENERAL.—The Secretary of 

15 Health and Human Services (in this subsection 

16 referred to as the ‘‘Secretary’’) shall establish, 

17 on an expedited basis, standards relating to the 

18 exception described in section 1128B(b)(3)(G) 

19 of the Social Security Act, as added by sub20 section (a), for health center entity arrange21 ments to the antikickback penalties. 

22 (B) FACTORS TO CONSIDER.—The Sec23 retary shall consider the following factors, 

24 among others, in establishing standards relating 
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1 to the exception for health center entity ar2 rangements under subparagraph (A): 

3 (i) Whether the arrangement between 

4 the health center entity and the other 

5 party results in savings of Federal grant 

6 funds or increased revenues to the health 

7 center entity. 

8 (ii) Whether the arrangement between 

9 the health center entity and the other 

10 party restricts or limits a patient’s freedom 

11 of choice. 

12 (iii) Whether the arrangement be13 tween the health center entity and the 

14 other party protects a health care profes15 sional’s independent medical judgment re16 garding medically appropriate treatment. 

17 The Secretary may also include other standards 

18 and criteria that are consistent with the intent 

19 of Congress in enacting the exception estab20 lished under this section. 

21 (2) INTERIM FINAL EFFECT.—No later than 

22 180 days after the date of enactment of this Act, the 

23 Secretary shall publish a rule in the Federal Reg24 ister consistent with the factors under paragraph 

25 (1)(B). Such rule shall be effective and final imme-
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1 diately on an interim basis, subject to such change 

2 and revision, after public notice and opportunity (for 

3 a period of not more than 60 days) for public com4 ment, as is consistent with this subsection. 

5 SEC. 4. REIMBURSEMENT FOR FEDERALLY QUALIFIED 

6 HEALTH CENTERS PARTICIPATING IN MEDI7 CARE MANAGED CARE. 

8 (a) REIMBURSEMENT.—

9 (1) IN GENERAL.—Section 1833(a)(3) of the 

10 Social Security Act (42 U.S.C. 1395l(a)(3)) is 

11 amended to read as follows: 

12 ‘‘(3) in the case of services described in section 

13 1832(a)(2)(D)—

14 ‘‘(A) except as provided in subparagraph 

15 (B), the costs which are reasonable and related 

16 to the cost of furnishing such services or which 

17 are based on such other tests of reasonableness 

18 as the Secretary may prescribe in regulations, 

19 including those authorized under section 

20 1861(v)(1)(A), less the amount a provider may 

21 charge as described in clause (ii) of section 

22 1866(a)(2)(A), but in no case may the payment 

23 for such services (other than for items and serv24 ices described in section 1861(s)(10)(A)) exceed 

25 80 percent of such costs; or 
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1 ‘‘(B) with respect to the services described 

2 in clause (ii) of section 1832(a)(2)(D) that are 

3 furnished to an individual enrolled with a 

4 Medicare+Choice organization under part C 

5 pursuant to a written agreement described in 

6 section 1853(j), the amount by which—

7 ‘‘(i) the amount of payment that 

8 would have otherwise been provided under 

9 subparagraph (A) (calculated as if ‘100 

10 percent’ were substituted for ‘80 percent’ 

11 in such subparagraph) for such services if 

12 the individual had not been so enrolled; ex13 ceeds 

14 ‘‘(ii) the amount of the payments re15 ceived under such written agreement for 

16 such services (not including any financial 

17 incentives provided for in such agreement 

18 such as risk pool payments, bonuses, or 

19 withholds), 

20 less the amount the Federally qualified health 

21 center may charge as described in section 

22 1857(e)(3)(C);’’.

23 (b) CONTINUATION OF MEDICARE+CHOICE MONTH24 LY PAYMENTS.—
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1 (1) IN GENERAL.—Section 1853 of the Social 

2 Security Act (42 U.S.C. 1395w–23) is amended by 

3 adding at the end the following new subsection: 

4 ‘‘(j) PAYMENT RULE FOR FEDERALLY QUALIFIED

5 HEALTH CENTER SERVICES.—If an individual who is en6 rolled with a Medicare+Choice organization under this 

7 part receives a service from a Federally qualified health 

8 center that has a written agreement with such organiza9 tion for providing such a service (including any agreement 

10 required under section 1857(e)(3))—

11 ‘‘(1) the Secretary shall pay the amount deter12 mined under section 1833(a)(3)(B) directly to the 

13 Federally qualified health center not less frequently 

14 than quarterly; and 

15 ‘‘(2) the Secretary shall not reduce the amount 

16 of the monthly payments to the Medicare+Choice 

17 organization made under section 1853(a) as a result 

18 of the application of paragraph (1).’’. 

19 (2) CONFORMING AMENDMENTS.—

20 (A) Paragraphs (1) and (2) of section 

21 1851(i) of the Social Security Act (42 U.S.C. 

22 1395w–21(i)(1)) are each amended by inserting 

23 ‘‘1853(j),’’ after ‘‘1853(h),’’. 

24 (B) Section 1853(c)(5) is amended by 

25 striking ‘‘subsections (a)(3)(C)(iii) and (i)’’ and 
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1 inserting ‘‘subsections (a)(3)(C)(iii), (i), and 

2 (j)(1)’’.

3 (c) ADDITIONAL MEDICARE+CHOICE CONTRACT RE4 QUIREMENTS.—Section 1857(e) of the Social Security Act 

5 (42 U.S.C. 1395w–27(e)) is amended by adding at the end 

6 the following new paragraph: 

7 ‘‘(3) AGREEMENTS WITH FEDERALLY QUALI8 FIED HEALTH CENTERS.—

9 ‘‘(A) PAYMENT LEVELS AND AMOUNTS.—A 

10 contract under this part shall require the 

11 Medicare+Choice organization to provide, in 

12 any contract between the organization and a 

13 Federally qualified health center, for a level and 

14 amount of payment to the Federally qualified 

15 health center for services provided by such 

16 health center that is not less than the level and 

17 amount of payment that the organization would 

18 make for such services if the services had been 

19 furnished by a provider of services that was not 

20 a Federally qualified health center. 

21 ‘‘(B) COST-SHARING.—Under the written 

22 agreement described in subparagraph (A), a 

23 Federally qualified health center must accept 

24 the Medicare+Choice contract price plus the 

25 Federal payment provided for in section 
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1 1833(a)(3)(B) as payment in full for services 

2 covered by the contract, except that such a 

3 health center may collect any amount of cost4 sharing permitted under the contract under this 

5 part, so long as the amounts of any deductible, 

6 coinsurance, or copayment comply with the re7 quirements under section 1854(e) and do not 

8 result in a total payment to the center in excess 

9 of the amount determined under section 

10 1833(a)(3)(A) (calculated as if ‘100 percent’ 

11 were substituted for ‘80 percent’ in such sec12 tion).’’. 

13 (d) SAFE HARBOR FROM ANTIKICKBACK PROHIBI14 TION.—Section 1128B(b)(3) of the Social Security Act 

15 (42 U.S.C. 1320a–7b(b)(3)), as amended by section 3(a), 

16 is amended—

17 (1) in subparagraph (F), by striking ‘‘and’’ 

18 after the semicolon at the end; 

19 (2) in subparagraph (G), by striking the period 

20 at the end and inserting ‘‘; and’’; and 

21 (3) by adding at the end the following new sub22 paragraph: 

23 ‘‘(H) any remuneration between a Feder24 ally qualified health center (or an entity con25 trolled by such a health center) and a 
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1 Medicare+Choice organization pursuant to the 

2 written agreement described in section 

3 1853(j).’’. 

4 (e) EFFECTIVE DATE.—The amendments made by 

5 this section shall apply to services provided on or after 

6 January 1, 2004, and contract years beginning on or after 

7 such date.

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