I 

108TH CONGRESS 

1ST SESSION H. R. 2342

To amend title XVIII of the Social Security Act to expand Medicare benefits 

to prevent, delay, and minimize the progression of chronic conditions, 

and develop national policies on effective chronic condition care, and 

for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 4, 2003

Mr. STARK (for himself, Mr. RANGEL, Mr. MATSUI, Mr. MCDERMOTT, Mr. 

SANDLIN, and Mrs. JONES of Ohio) introduced the following bill; which 

was referred to the Committee on Energy and Commerce, and in addition 

to the Committee on Ways and Means, 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 expand 

Medicare benefits to prevent, delay, and minimize the 

progression of chronic conditions, and develop national 

policies on effective chronic condition care, 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 Chronic Care Improvement 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. 

TITLE I—BENEFITS TO PREVENT, DELAY, AND MINIMIZE THE 

PROGRESSION OF CHRONIC CONDITIONS 

Subtitle A—Improving Access to Preventive Services 

Sec. 101. Elimination of deductibles and coinsurance for existing preventive 

health benefits. 

Sec. 102. Institute of Medicine medicare prevention benefit study and report. 

Sec. 103. Authority to administratively provide for coverage of additional preventive benefits. 

Sec. 104. Coverage of an initial preventive physical examination. 

Subtitle B—Medicare Coverage for Care Coordination and Assessment 

Services 

Sec. 111. Care coordination and assessment services. 

Sec. 112. Care coordination and assessment services and quality improvement 

program in Medicare+Choice plans. 

Sec. 113. Improving chronic care coordination through information technology. 

Subtitle C—Additional Provisions 

Sec. 121. Review of coverage standards. 

TITLE II—INSTITUTE OF MEDICINE STUDY ON EFFECTIVE 

CHRONIC CONDITION CARE 

Sec. 201. Institute of Medicine medicare chronic condition care improvement 

study and report.
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1 TITLE I—BENEFITS TO PRE2 VENT, DELAY, AND MINIMIZE 

3 THE PROGRESSION OF 

4 CHRONIC CONDITIONS 

5 Subtitle A—Improving Access to 

6 Preventive Services 

7 SEC. 101. ELIMINATION OF DEDUCTIBLES AND COINSUR8 ANCE FOR EXISTING PREVENTIVE HEALTH 

9 BENEFITS. 

10 (a) IN GENERAL.—Section 1833 of the Social Secu11 rity Act (42 U.S.C. 1395l) is amended by inserting after 

12 subsection (o) the following new subsection: 

13 ‘‘(p) DEDUCTIBLES AND COINSURANCE WAIVED FOR

14 PREVENTIVE HEALTH ITEMS AND SERVICES.—The Sec15 retary shall not require the payment of any deductible or 

16 coinsurance under subsection (a) or (b), respectively, of 

17 any individual enrolled for coverage under this part for 

18 any of the following preventive health items and services: 

19 ‘‘(1) Blood-testing strips, lancets, and blood 

20 glucose monitors for individuals with diabetes de21 scribed in section 1861(n). 

22 ‘‘(2) Diabetes outpatient self-management 

23 training services (as defined in section 1861(qq)(1)). 
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1 ‘‘(3) Pneumococcal, influenza, and hepatitis B 

2 vaccines and administration described in section 

3 1861(s)(10). 

4 ‘‘(4) Screening mammography (as defined in 

5 section 1861(jj)). 

6 ‘‘(5) Screening pap smear and screening pelvic 

7 exam (as defined in paragraphs (1) and (2) of sec8 tion 1861(nn), respectively). 

9 ‘‘(6) Bone mass measurement (as defined in 

10 section 1861(rr)(1)). 

11 ‘‘(7) Prostate cancer screening test (as defined 

12 in section 1861(oo)(1)). 

13 ‘‘(8) Colorectal cancer screening test (as de14 fined in section 1861(pp)(1)). 

15 ‘‘(9) Screening for glaucoma (as defined in sec16 tion 1861(uu)). 

17 ‘‘(10) Medical nutrition therapy services (as de18 fined in section 1861(vv)(1)).’’. 

19 (b) WAIVER OF COINSURANCE.—

20 (1) IN GENERAL.—Section 1833(a)(1)(B) of the 

21 Social Security Act (42 U.S.C. 1395l(a)(1)(B)) is 

22 amended to read as follows: ‘‘(B) with respect to 

23 preventive health items and services described in 

24 subsection (p), the amounts paid shall be 100 per-
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1 cent of the fee schedule or other basis of payment 

2 under this title for the particular item or service,’’. 

3 (2) ELIMINATION OF COINSURANCE IN OUT4 PATIENT HOSPITAL SETTINGS.—The third sentence 

5 of section 1866(a)(2)(A) of the Social Security Act 

6 (42 U.S.C. 1395cc(a)(2)(A)) is amended by insert7 ing after ‘‘1861(s)(10)(A)’’ the following: ‘‘, preven8 tive health items and services described in section 

9 1833(p),’’. 

10 (c) WAIVER OF APPLICATION OF DEDUCTIBLE.—

11 Section 1833(b)(1) of the Social Security Act (42 U.S.C. 

12 1395l(b)(1)) is amended to read as follows: ‘‘(1) such de13 ductible shall not apply with respect to preventive health 

14 items and services described in subsection (p),’’. 

15 (d) ADDING ‘‘LANCET’’ TO DEFINITION OF DME.—

16 Section 1861(n) of the Social Security Act (42 U.S.C. 

17 1395x(n)) is amended by striking ‘‘blood-testing strips 

18 and blood glucose monitors’’ and inserting ‘‘blood-testing 

19 strips, lancets, and blood glucose monitors’’. 

20 (e) CONFORMING AMENDMENTS.—

21 (1) ELIMINATION OF COINSURANCE FOR CLIN22 ICAL DIAGNOSTIC LABORATORY TESTS.—Paragraphs 

23 (1)(D)(i) and (2)(D)(i) of section 1833(a) of the So24 cial Security Act (42 U.S.C. 1395l(a)) are each
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1 amended by inserting ‘‘or which are described in 

2 subsection (p)’’ after ‘‘assignment-related basis’’. 

3 (2) ELIMINATION OF COINSURANCE FOR CER4 TAIN DME.—Section 1834(a)(1)(A) of the Social Se5 curity Act (42 U.S.C. 1395m(a)(1)(A)) is amended 

6 by inserting ‘‘(or 100 percent, in the case of such an 

7 item described in section 1833(p))’’ after ‘‘80 per8 cent’’. 

9 (3) ELIMINATION OF DEDUCTIBLES AND COIN10 SURANCE FOR COLORECTAL CANCER SCREENING

11 TESTS.—Section 1834(d) of the Social Security Act 

12 (42 U.S.C. 1395m(d)) is amended—

13 (A) in paragraph (2)(C)—

14 (i) by striking ‘‘(C) FACILITY PAY15 MENT LIMIT.—’’ and all that follows 

16 through ‘‘Notwithstanding subsections’’ 

17 and inserting the following: 

18 ‘‘(C) FACILITY PAYMENT LIMIT.—Notwith19 standing subsections’’; 

20 (ii) by striking ‘‘(I) in accordance’’ 

21 and inserting the following: 

22 ‘‘(i) in accordance’’; 

23 (iii) by striking ‘‘(II) are performed’’ 

24 and all that follows through ‘‘payment 

25 under’’ and inserting the following: 
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1 ‘‘(ii) are performed in an ambulatory 

2 surgical center or hospital outpatient de3 partment, 

4 payment under’’; and 

5 (iv) by striking clause (ii); and 

6 (B) in paragraph (3)(C)—

7 (i) by striking ‘‘(C) FACILITY PAY8 MENT LIMIT.—’’ and all that follows 

9 through ‘‘Notwithstanding subsections’’ 

10 and inserting the following: 

11 ‘‘(C) FACILITY PAYMENT LIMIT.—Notwith12 standing subsections’’; and 

13 (ii) by striking clause (ii). 

14 (f) EFFECTIVE DATE.—The amendments made by 

15 this section shall apply to services furnished on or after 

16 January 1, 2004. 

17 SEC. 102. INSTITUTE OF MEDICINE MEDICARE PREVEN18 TION BENEFIT STUDY AND REPORT. 

19 (a) STUDY.—

20 (1) IN GENERAL.—The Secretary of Health and 

21 Human Services shall contract with the Institute of 

22 Medicine of the National Academy of Sciences to—

23 (A) conduct a comprehensive study of cur24 rent literature and best practices in the field of 

25 health promotion and disease prevention among 
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1 medicare beneficiaries, including the issues de2 scribed in paragraph (2); and 

3 (B) submit the report described in sub4 section (b). 

5 (2) ISSUES STUDIED.—The study required 

6 under paragraph (1) shall include an assessment 

7 of—

8 (A) whether each health promotion and 

9 disease prevention benefit covered under the 

10 medicare program is medically effective (as de11 fined in subsection (d)(3)); 

12 (B) utilization by medicare beneficiaries of 

13 such benefits (including any barriers to or in14 centives to increase utilization); 

15 (C) quality of life issues associated with 

16 such benefits; and 

17 (D) whether health promotion and disease 

18 prevention benefits that are not covered under 

19 the medicare program that would affect all 

20 medicare beneficiaries are likely to be medically 

21 effective (as so defined). 

22 (b) REPORTS.—

23 (1) THREE-YEAR REPORT.—On the date that is 

24 3 years after the date of enactment of this Act, and 

25 each successive 3-year anniversary thereafter, the 
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1 Institute of Medicine of the National Academy of 

2 Sciences shall submit to the President a report that 

3 contains—

4 (A) a detailed statement of the findings 

5 and conclusions of the study conducted under 

6 subsection (a); and 

7 (B) the recommendations for legislation 

8 described in paragraph (3).

9 (2) INTERIM REPORT BASED ON NEW GUIDE10 LINES.—If the United States Preventive Services 

11 Task Force or the Task Force on Community Pre12 ventive Services establishes new guidelines regarding 

13 preventive health benefits for medicare beneficiaries 

14 more than 1 year prior to the date that a report de15 scribed in paragraph (1) is due to be submitted to 

16 the President, then not later than 6 months after 

17 the date such new guidelines are established, the In18 stitute of Medicine of the National Academy of 

19 Sciences shall submit to the President a report that 

20 contains a detailed description of such new guide21 lines. Such report may also contain recommenda22 tions for legislation described in paragraph (3). 

23 (3) RECOMMENDATIONS FOR LEGISLATION.—

24 The Institute of Medicine of the National Academy 

25 of Sciences, in consultation with the United States 
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1 Preventive Services Task Force and the Task Force 

2 on Community Preventive Services, shall develop 

3 recommendations in legislative form that—

4 (A) prioritize the preventive health benefits 

5 under the medicare program; and 

6 (B) modify such benefits, including adding 

7 new benefits under such program, based on the 

8 study conducted under subsection (a). 

9 (c) TRANSMISSION TO CONGRESS.—

10 (1) IN GENERAL.—Subject to paragraph (2), on 

11 the day that is 6 months after the date on which the 

12 report described in paragraph (1) of subsection (b) 

13 (or paragraph (2) of such subsection if the report 

14 contains recommendations in legislative form de15 scribed in subsection (b)(3)) is submitted to the 

16 President, the President shall transmit the report 

17 and recommendations to Congress. 

18 (2) REGULATORY ACTION BY THE SECRETARY

19 OF HEALTH AND HUMAN SERVICES.—If the Sec20 retary of Health and Human Services has exercised 

21 the authority under section 103(a) to adopt by regu22 lation one or more of the recommendations under 

23 subsection (b)(3), the President shall only submit to 

24 Congress those recommendations under subsection 

25 (b)(3) that have not been adopted by the Secretary.
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1 (3) DELIVERY.—Copies of the report and rec2 ommendations in legislative form required to be 

3 transmitted to Congress under paragraph (1) shall 

4 be delivered— 

5 (A) to both Houses of Congress on the 

6 same day; 

7 (B) to the Clerk of the House of Rep8 resentatives if the House is not in session; and 

9 (C) to the Secretary of the Senate if the 

10 Senate is not in session. 

11 (d) DEFINITION OF MEDICALLY EFFECTIVE.—In 

12 this section, the term ‘‘medically effective’’ means, with 

13 respect to a benefit or technique, that the benefit or tech14 nique has been—

15 (1) subject to peer review; 

16 (2) described in scientific journals; and 

17 (3) determined to achieve an intended goal 

18 under normal programmatic conditions.

19 SEC. 103. AUTHORITY TO ADMINISTRATIVELY PROVIDE 

20 FOR COVERAGE OF ADDITIONAL PREVEN21 TIVE BENEFITS. 

22 (a) IN GENERAL.—The Secretary of Health and 

23 Human Services may by regulation adopt any or all of 

24 the legislative recommendations developed by the Institute 

25 of Medicine of the National Academy of Sciences, in con-
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1 sultation with the United States Preventive Services Task 

2 Force and the Task Force on Community Preventive Serv3 ices in a report under section 102(b)(3) (relating to 

4 prioritizing and modifying preventive health benefits 

5 under the medicare program and the addition of new pre6 ventive benefits), consistent with subsection (b). 

7 (b) ELIMINATION OF COST-SHARING.—With respect 

8 to items and services furnished under the medicare pro9 gram that the Secretary has incorporated by regulation 

10 under subsection (a), the provisions of section 1833(p) of 

11 the Social Security Act (relating to elimination of cost12 sharing for preventive benefits), as added by section 

13 101(a), shall apply to those items and services in the same 

14 manner as such section applies to the items and services 

15 described in paragraphs (1) through (10) of such section. 

16 SEC. 104. COVERAGE OF AN INITIAL PREVENTIVE PHYS17 ICAL EXAMINATION. 

18 (a) COVERAGE.—Section 1861(s)(2) of the Social Se19 curity Act (42 U.S.C. 1395x(s)(2)) is amended—

20 (1) in subparagraph (U), by striking ‘‘and’’ at 

21 the end; 

22 (2) in subparagraph (V), by inserting ‘‘and’’ at 

23 the end; and 

24 (3) by adding at the end the following new sub25 paragraph: 
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1 ‘‘(W) an initial preventive physical examination 

2 (as defined in subsection (ww));’’. 

3 (b) SERVICES DESCRIBED.—Section 1861 of such 

4 Act (42 U.S.C. 1395x) is amended by adding at the end 

5 the following new subsection: 

6 ‘‘Initial Preventive Physical Examination 

7 ‘‘(ww) The term ‘initial preventive physical examina8 tion’ means physicians’ services consisting of a physical 

9 examination with the goal of health promotion and disease 

10 detection and includes a history and physical exam, a 

11 health risk appraisal, and health risk counseling, and lab12 oratory tests or other items and services as determined 

13 by the Secretary in consultation with the United States 

14 Preventive Services Task Force.’’. 

15 (c) WAIVER OF DEDUCTIBLE AND COINSURANCE.—

16 (1) DEDUCTIBLE.—The first sentence of sec17 tion 1833(b) of such Act (42 U.S.C. 1395l(b)) is 

18 amended—

19 (A) by striking ‘‘and’’ before ‘‘(6)’’, and 

20 (B) by inserting before the period at the 

21 end the following: ‘‘, and (7) such deductible 

22 shall not apply with respect to an initial preven23 tive physical examination (as defined in section 

24 1861(ww))’’. 
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1 (2) COINSURANCE.—Section 1833(a)(1) of such 

2 Act (42 U.S.C. 1395l(a)(1)) is amended—

3 (A) in clause (N), by inserting ‘‘(or 100 

4 percent in the case of an initial preventive phys5 ical examination, as defined in section 

6 1861(ww))’’ after ‘‘80 percent’’; and 

7 (B) in clause (O), by inserting ‘‘(or 100 

8 percent in the case of an initial preventive phys9 ical examination, as defined in section 

10 1861(ww))’’ after ‘‘80 percent’’. 

11 (d) PAYMENT AS PHYSICIANS’ SERVICES.—Section 

12 1848(j)(3) of such Act (42 U.S.C. 1395w–4(j)(3)) is 

13 amended by inserting ‘‘(2)(W),’’ after ‘‘(2)(S),’’. 

14 (e) OTHER CONFORMING AMENDMENTS.—Section 

15 1862(a) of such Act (42 U.S.C. 1395y(a)) is amended—

16 (1) in paragraph (1)—

17 (A) by striking ‘‘and’’ at the end of sub18 paragraph (H); 

19 (B) by striking the semicolon at the end of 

20 subparagraph (I) and inserting ‘‘, and’’; and 

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

22 subparagraph: 

23 ‘‘(J) in the case of an initial preventive physical 

24 examination (as defined in section 1861(ww)), which 

25 is performed not later than 6 months after the date 
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1 the individual’s first coverage period begins under 

2 part B;’’; and 

3 (2) in paragraph (7), by striking ‘‘or (H)’’ and 

4 inserting ‘‘(H), or (J)’’. 

5 (f) EFFECTIVE DATE.—The amendments made by 

6 this section shall apply to services furnished on or after 

7 January 1, 2004, but only for individuals whose coverage 

8 period begins on or after such date. 

9 Subtitle B—Medicare Coverage for 

10 Care Coordination and Assess11 ment Services 

12 SEC. 111. CARE COORDINATION AND ASSESSMENT SERV13 ICES. 

14 (a) SERVICES AUTHORIZED.—Title XVIII of the So15 cial Security Act (42 U.S.C. 1395 et seq.) is amended by 

16 adding at the end the following new section: 

17 ‘‘CARE COORDINATION AND ASSESSMENT SERVICES

18 ‘‘SEC. 1897. (a) PURPOSE.—

19 ‘‘(1) IN GENERAL.—The purpose of this section 

20 is to provide the appropriate level and mix of follow21 up care to an individual with a chronic condition 

22 who qualifies as an eligible beneficiary (as defined in 

23 paragraph (2)). 

24 ‘‘(2) ELIGIBLE BENEFICIARY DEFINED.—In 

25 this section, the term ‘eligible beneficiary’ means a 

26 beneficiary who—
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1 ‘‘(A) has a serious and disabling chronic 

2 condition (as defined in subsection(f)(1)); or 

3 ‘‘(B) has four or more chronic conditions 

4 (as defined in subsection (f)(4)). 

5 ‘‘(b) ELECTION OF CARE COORDINATION AND AS6 SESSMENT SERVICES.—

7 ‘‘(1) IN GENERAL.—On or after January 1, 

8 2005, an eligible beneficiary may elect to receive 

9 care coordination services in accordance with the 

10 provisions of this section under which, in appro11 priate circumstances, the eligible beneficiary has 

12 health care services covered under this title managed 

13 and coordinated by a care coordinator who is quali14 fied under subsection (e) to furnish care coordina15 tion services under this section. 

16 ‘‘(2) REVOCATION OF ELECTION.—An eligible 

17 beneficiary who has made an election under para18 graph (1) may revoke that election at any time. 

19 ‘‘(c) OUTREACH.—The Secretary shall provide for the 

20 wide dissemination of information to beneficiaries and pro21 viders of services, physicians, practitioners, and suppliers 

22 with respect to the availability of and requirements for 

23 care coordination services under this section. 
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1 ‘‘(d) CARE COORDINATION AND ASSESSMENT SERV2 ICES DESCRIBED.—Care coordination services under this 

3 section shall include the following: 

4 ‘‘(1) BASIC CARE COORDINATION AND ASSESS5 MENT SERVICES.—Except as otherwise provided in 

6 this section, eligible beneficiaries who have made an 

7 election under this section shall receive the following 

8 services: 

9 ‘‘(A)(i) An initial assessment of an individ10 ual’s medical condition, functional and cognitive 

11 capacity, and environmental and psychosocial 

12 needs. 

13 ‘‘(ii) Annual assessments after the initial 

14 assessment performed under clause (i), unless 

15 the physician or care coordinator of the indi16 vidual determines that additional assessments 

17 are required due to sentinel health events or 

18 changes in the health status of the individual 

19 that may require changes in the plan of care 

20 developed for the individual. 

21 ‘‘(B) The development of an initial plan of 

22 care, and subsequent appropriate revisions to 

23 that plan of care. 

24 ‘‘(C) The management of, and referral for, 

25 medical and other health services, including 
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1 multidisciplinary care conferences and coordina2 tion with other providers. 

3 ‘‘(D) The monitoring and management of 

4 medications. 

5 ‘‘(E) Patient education and counseling 

6 services. 

7 ‘‘(F) Family caregiver education and coun8 seling services. 

9 ‘‘(G) Self-management services, including 

10 health education and risk appraisal to identify 

11 behavioral risk factors through self-assessment. 

12 ‘‘(H) Consultations by telephone with phy13 sicians and other appropriate health care pro14 fessionals, including 24-hour access to a care 

15 coordinator. 

16 ‘‘(I) Coordination with the principal care17 giver in the home. 

18 ‘‘(J) The managing and facilitating of 

19 transitions among health care professionals and 

20 across settings of care, including the following: 

21 ‘‘(i) The pursuit the treatment option 

22 elected by the individual. 

23 ‘‘(ii) The inclusion of any advance di24 rective executed by the individual in the 

25 medical file of the individual. 
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1 ‘‘(K) Activities that facilitate continuity of 

2 care and patient adherence to plans of care. 

3 ‘‘(L) Information about, and referral to, 

4 community-based services, including patient and 

5 family caregiver education and counseling about 

6 such services, and facilitating access to such 

7 services when elected. 

8 ‘‘(M) Information about, and referral to, 

9 hospice services and palliative care, including 

10 patient and family caregiver education and 

11 counseling about hospice services and palliative 

12 care, and facilitating transition to hospice when 

13 elected. 

14 ‘‘(N) Such other medical and health care 

15 services for which payment would not otherwise 

16 be made under this title as the Secretary deter17 mines to be appropriate for effective care co18 ordination, including the additional items and 

19 services as described in paragraph (2). 

20 ‘‘(2) ADDITIONAL BENEFITS.—The Secretary 

21 may specify additional benefits for which payment 

22 would not otherwise be made under this title that 

23 may be available to eligible beneficiaries who have 

24 made an election under this section (subject to an 

25 assessment by the care coordinator of an individual 
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1 beneficiary’s circumstances and need for such bene2 fits) in order to encourage the receipt of, or to im3 prove the effectiveness of, care coordination services. 

4 ‘‘(e) CARE COORDINATORS.—

5 ‘‘(1) REQUIREMENT FOR CERTIFICATION.—

6 ‘‘(A) IN GENERAL.—In order to be quali7 fied to furnish care coordination and assess8 ment services under this section, an individual 

9 or entity shall be a health care professional or 

10 entity (which may include physicians, physician 

11 group practices, or other health care profes12 sionals or entities the Secretary may find ap13 propriate) who has been certified for a period 

14 (as provided in subparagraph (B)) by the Sec15 retary, or by an organization recognized by the 

16 Secretary, as having met such criteria as the 

17 Secretary may establish for the furnishing of 

18 care coordination under this section (which may 

19 include experience in the provision of care co20 ordination or primary care physician’s services). 

21 ‘‘(B) PERIOD OF CERTIFICATION.—The pe22 riod of certification for an individual referred to 

23 in subparagraph (A) is as follows:
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1 ‘‘(i) A one-year period for each of the 

2 first three years of participation under this 

3 section. 

4 ‘‘(ii) A three-year period thereafter. 

5 ‘‘(2) ADDITIONAL REQUIREMENTS.—

6 ‘‘(A) SUBMISSION OF DATA.—A care coor7 dinator shall comply with such data collection 

8 and reporting requirements as the Secretary de9 termines necessary to assess the effect of care 

10 coordination on health outcomes. 

11 ‘‘(B) PARTICIPATION IN QUALITY IM12 PROVEMENT PROGRAM.—A care coordinator 

13 shall participate in the quality improvement 

14 program under paragraph (3). 

15 ‘‘(C) ADDITIONAL TERMS.—A care coordi16 nator shall comply with such other terms and 

17 conditions as the Secretary may specify. 

18 ‘‘(3) QUALITY IMPROVEMENT PROGRAM.—

19 ‘‘(A) IN GENERAL.—The Secretary shall 

20 establish a chronic care quality assurance pro21 gram to monitor and improve clinical outcomes 

22 for beneficiaries with chronic conditions. 

23 ‘‘(B) ELEMENTS OF PROGRAM.—Under the 

24 program, the Secretary shall—

25 ‘‘(i) establish standards to measure—
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1 ‘‘(I) quality and performance of 

2 the care of chronic conditions; 

3 ‘‘(II) the continuity and coordi4 nation of care that eligible bene5 ficiaries under this section receive; 

6 and 

7 ‘‘(III) both underutilization and 

8 overutilization of services; 

9 ‘‘(ii) provide to care coordinators peri10 odic reports on their performance on such 

11 measures; and 

12 ‘‘(iii) make available information on 

13 quality and outcomes measures to facilitate 

14 beneficiary comparison and choice of care 

15 coordination options (in such form and on 

16 such quality and outcomes measures as the 

17 Secretary determines to be appropriate). 

18 ‘‘(C) REVIEW OF CLAIMS.—

19 ‘‘(i) IN GENERAL.—Subject to clause 

20 (ii), under the program the Secretary shall 

21 make available to care coordinators claims 

22 data relating to a beneficiary for whom the 

23 coordinator coordinates care under this 

24 section for the coordinator’s review and 

25 subsequent appropriate follow-up action. 
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1 ‘‘(ii) AUTHORIZATION.—Data may 

2 only be provided to a care coordinator 

3 under clause (i) if the eligible beneficiary 

4 involved has given written authorization 

5 for such information to be so provided. 

6 ‘‘(4) LIMITATION ON NUMBER OF CARE COOR7 DINATORS.—Payment may only be made under this 

8 section for care coordination services furnished dur9 ing a period to one care coordinator with respect to 

10 an eligible beneficiary. 

11 ‘‘(5) PAYMENT FOR SERVICES.—

12 ‘‘(A) IN GENERAL.—The Secretary shall 

13 establish payment terms and conditions and 

14 payment rates for basic care coordination and 

15 assessment services described in subsection (d). 

16 ‘‘(B) PAYMENT METHODOLOGY.—Payment 

17 under this section shall be made in a manner 

18 that bundles payment for all care coordination 

19 and assessment services furnished during a pe20 riod, as specified by the Secretary. 

21 ‘‘(C) CODES.—The Secretary may estab22 lish new billing codes to carry out the provisions 

23 of this paragraph. 

24 ‘‘(f) DEFINITIONS.—In this section: 
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1 ‘‘(1) SERIOUS AND DISABLING CHRONIC CONDI2 TION.—The term ‘serious and disabling chronic con3 dition’ means, with respect to an individual, that the 

4 individual has at least one chronic condition and a 

5 licensed health care practitioner has certified within 

6 the preceding 12-month period that—

7 ‘‘(A) the individual has a level of disability 

8 such that the individual is unable to perform 

9 (without substantial assistance from another in10 dividual) for a period of at least 90 days due 

11 to a loss of functional capacity—

12 ‘‘(i) at least 2 activities of daily living; 

13 or 

14 ‘‘(ii) such number of instrumental ac15 tivities of daily living that is equivalent (as 

16 determined by the Secretary) to the level 

17 of disability described in clause (i); 

18 ‘‘(B) the individual has a level of disability 

19 equivalent (as determined by the Secretary) to 

20 the level of disability described in subparagraph 

21 (A); or 

22 ‘‘(C) the individual requires substantial su23 pervision to protect the individual from threats 

24 to health and safety due to severe cognitive im25 pairment. 
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1 ‘‘(2) ACTIVITIES OF DAILY LIVING.—The term 

2 ‘activities of daily living’ means each of the fol3 lowing: 

4 ‘‘(A) Eating. 

5 ‘‘(B) Toileting. 

6 ‘‘(C) Transferring. 

7 ‘‘(D) Bathing. 

8 ‘‘(E) Dressing. 

9 ‘‘(F) Continence. 

10 ‘‘(3) INSTRUMENTAL ACTIVITIES OF DAILY LIV11 ING.—The term ‘instrumental activities of daily liv12 ing’ means each of the following: 

13 ‘‘(A) Medication management. 

14 ‘‘(B) Meal preparation. 

15 ‘‘(C) Shopping. 

16 ‘‘(D) Housekeeping. 

17 ‘‘(E) Laundry. 

18 ‘‘(F) Money management. 

19 ‘‘(G) Telephone use. 

20 ‘‘(H) Transportation use. 

21 ‘‘(4) CHRONIC CONDITION.—The term ‘chronic 

22 condition’ means an illness, functional limitation, or 

23 cognitive impairment that—

24 ‘‘(A) lasts, or is expected to last, at least 

25 one year;
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1 ‘‘(B) limits what a person can do; and 

2 ‘‘(C) requires on-going medical care. 

3 ‘‘(5) BENEFICIARY.—The term ‘beneficiary’ 

4 means an individual entitled to benefits under part 

5 A and enrolled under part B, including an individual 

6 enrolled under the Medicare+Choice program under 

7 part C.’’. 

8 (b) COVERAGE OF CARE COORDINATION AND AS9 SESSMENT SERVICES AS A PART B MEDICAL SERVICE.—

10 (1) IN GENERAL.—Section 1861(s) of the So11 cial Security Act (42 U.S.C. 1395x(s)) is amended—

12 (A) in the second sentence, by redesig13 nating paragraphs (16) and (17) as clauses (i) 

14 and (ii); and 

15 (B) in the first sentence—

16 (i) by striking ‘‘and’’ at the end of 

17 paragraph (14); 

18 (ii) by striking the period at the end 

19 of paragraph (15) and inserting ‘‘; and’’; 

20 and 

21 (iii) by adding after paragraph (15) 

22 the following new paragraph: 

23 ‘‘(16) care coordination and assessment services 

24 furnished by a care coordinator in accordance with 

25 section 1897.’’. 
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1 (2) CONFORMING AMENDMENTS.—Sections 

2 1864(a), 1902(a)(9)(C), and 1915(a)(1)(B)(ii)(I) of 

3 such Act (42 U.S.C. 1395aa(a), 1396a(a)(9)(C), and 

4 1396n(a)(1)(B)(ii)(I)) are each amended by striking 

5 ‘‘paragraphs (16) and (17)’’ each place it appears 

6 and inserting ‘‘clauses (i) and (ii) of the second sen7 tence’’. 

8 (3) PART B COINSURANCE AND DEDUCTIBLE

9 NOT APPLICABLE TO CARE COORDINATION AND AS10 SESSMENT SERVICES.—

11 (A) COINSURANCE.—Section 1833(a)(1) of 

12 the Social Security Act (42 U.S.C. 1395l(a)(1)) 

13 is amended—

14 (i) by striking ‘‘and’’ at the end of 

15 subparagraph (T); and 

16 (ii) by inserting before the final semi17 colon ‘‘, and (V) with respect to care co18 ordination and assessment services de19 scribed in section 1861(s)(16) that are fur20 nished by, or coordinated through, a care 

21 coordinator, the amounts paid shall be 100 

22 percent of the payment amount established 

23 under section 1897’’. 

24 (B) DEDUCTIBLE.—Section 1833(b) of 

25 such Act (42 U.S.C. 1395l(b)) is amended—
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1 (i) by striking ‘‘and’’ at the end of 

2 paragraph (5); and 

3 (ii) by inserting before the final period 

4 ‘‘, and (7) such deductible shall not apply 

5 with respect to care coordination and as6 sessment services (as described in section 

7 1861(s)(16))’’. 

8 (C) ELIMINATION OF COINSURANCE IN

9 OUTPATIENT HOSPITAL SETTINGS.—The third 

10 sentence of section 1866(a)(2)(A) of such Act 

11 (42 U.S.C. 1395cc(a)(2)(A)), as amended by 

12 section 101(b)(2), is further amended by insert13 ing after ‘‘section 1833(p),’’ the following: 

14 ‘‘with respect to care coordination and assess15 ment services (as described in section 

16 1861(s)(16)),’’. 

17 SEC. 112. CARE COORDINATION AND ASSESSMENT SERV18 ICES AND QUALITY IMPROVEMENT PROGRAM 

19 IN MEDICARE+CHOICE PLANS. 

20 Section 1852(e)(1) of the Social Security Act (42 

21 U.S.C. 1395w–22(e)(1)) is amended by inserting before 

22 the period at the end the following: ‘‘, including a quality 

23 improvement program for coordinated care services re24 ferred to in section 1897(e)(3)’’. 
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1 SEC. 113. IMPROVING CHRONIC CARE COORDINATION 

2 THROUGH INFORMATION TECHNOLOGY. 

3 (a) TECHNOLOGY IMPROVEMENT GRANTS.—

4 (1) IN GENERAL.—The Secretary of Health and 

5 Human Services (hereinafter in this section referred 

6 to as the ‘‘Secretary’’) shall make grants to eligible 

7 entities to enable such entities to develop, imple8 ment, or train personnel in the use of standardized 

9 clinical information technology systems designed 

10 to—

11 (A) improve the coordination and quality 

12 of care furnished to medicare beneficiaries with 

13 chronic conditions; and 

14 (B) increase administrative efficiencies of 

15 such entities. 

16 (2) CARE COORDINATORS AS ELIGIBLE ENTI17 TIES.—In this section, an eligible entity is a care co18 ordinator who furnishes care coordination services to 

19 medicare beneficiaries under section 1897 of the So20 cial Security Act. 

21 (b) ELIGIBILITY.—To be eligible to receive a grant 

22 under subsection (a), a care coordinator shall—

23 (1) prepare and submit to the Secretary an ap24 plication at such time, in such manner, and con25 taining such information as the Secretary may re26 quire, including a description of the clinical informa-
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1 tion technology system that the care coordinator in2 tends to implement using amounts received under 

3 the grant; 

4 (2) provide assurances that are satisfactory to 

5 the Secretary that such system, for which amounts 

6 are to be expended under the grant, conforms to the 

7 standards established by the Secretary under part C 

8 of title XI of the Social Security Act, and such other 

9 standards as the Secretary may specify; and 

10 (3) furnish the Secretary with such information 

11 as the Secretary may require to—

12 (A) evaluate the project for which the 

13 grant is made; and 

14 (B) ensure that funding provided under 

15 the grant is expended for the purposes for 

16 which it is made. 

17 (c) MATCHING REQUIREMENT.—The Secretary may 

18 not make a grant to a care coordinator under subsection 

19 (a) unless that care coordinator agrees that, with respect 

20 to the costs to be incurred by the care coordinator in car21 rying out the activities for which the grant is being award22 ed, the care coordinator will make available (directly or 

23 through donations from public or private entities) non24 Federal contributions toward such costs in an amount
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1 equal to $1 for each $1 of Federal funds provided under 

2 the grant. 

3 (d) REPORTS TO CONGRESS.—

4 (1) INITIAL REPORT.—Not later than 18 

5 months after the first grant has been made under 

6 this section, the Secretary shall submit an initial re7 port to Congress containing the information referred 

8 to in paragraph (3) as well as any recommendations 

9 with respect to grants under this section. 

10 (2) FINAL REPORT.—Not later than 6 months 

11 after the last grant has been awarded (as deter12 mined by the Secretary) under this section, the Sec13 retary shall submit a final report to Congress con14 taining the information referred to in paragraph (2) 

15 as well as any recommendations with respect to 

16 grants under this section. 

17 (3) CONTENTS OF REPORT.—The reports under 

18 this subsection shall include the following: 

19 (A) A description of the number and na20 ture of grants made under this section. 

21 (B) An evaluation of—

22 (i) improvements in the coordination 

23 and quality of care furnished to bene24 ficiaries with chronic conditions; and 
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1 (ii) increases in administrative effi2 ciencies of care coordinators. 

3 (e) AUTHORIZATION OF APPROPRIATIONS.—For each 

4 of fiscal years 2005, 2006, and 2007, there are authorized 

5 to be appropriated to the Secretary $10,000,000 to carry 

6 out the program under this section. 

7 Subtitle C—Additional Provisions 

8 SEC. 121. REVIEW OF COVERAGE STANDARDS. 

9 (a) REVIEW.—With respect to determinations under 

10 section 1862(a)(1) of such Act (42 U.S.C. 1395y(a)(1)) 

11 (relating to whether an item or service is reasonable and 

12 necessary for the diagnosis or treatment of illness or in13 jury for purposes of payment under title XVIII of such 

14 Act), the Secretary of Health and Human Services shall 

15 conduct a review of—

16 (1) regulations, policies, procedures, and in17 structions of the Centers for Medicare & Medicaid 

18 Services for making those determinations; and 

19 (2) policies, procedures, local medical review 

20 policies, manual instructions, interpretative rules, 

21 statements of policy, and guidelines of general appli22 cability of fiscal intermediaries (under section 1816 

23 of the Social Security Act (42 U.S.C. 1395h)) and 

24 carriers under section 1842 of such Act (42 U.S.C. 

25 1395u) for making those determinations. 
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1 (b) MODIFICATION.—Insofar as the Secretary deter2 mines that the Centers for Medicare & Medicaid Services, 

3 a fiscal intermediary, or a carrier has misapplied such 

4 standard by requiring that the item or service improve the 

5 condition of the patient with respect to such illness or in6 jury, the Secretary shall take such corrective measures as 

7 are appropriate to ensure the Centers, intermediary, or 

8 carrier (as the case may be) applies the proper standard 

9 for making such determinations. 

10 (c) REPORT.—On the date that is 18 months after 

11 the date of enactment of this Act, the Secretary shall sub12 mit to Congress a report that contains—

13 (1) a detailed statement of the findings and 

14 conclusions of the review conducted under subsection 

15 (a); 

16 (2) a detailed statement of the modifications 

17 made under subsection (b); and 

18 (3) recommendations to avoid misapplication of 

19 the standard in the future. 
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1 TITLE II—INSTITUTE OF MEDI2 CINE STUDY ON EFFECTIVE 

3 CHRONIC CONDITION CARE 

4 SEC. 201. INSTITUTE OF MEDICINE MEDICARE CHRONIC 

5 CONDITION CARE IMPROVEMENT STUDY AND 

6 REPORT. 

7 (a) STUDY.—

8 (1) IN GENERAL.—The Secretary of Health and 

9 Human Services shall contract with the Institute of 

10 Medicine of the National Academy of Sciences to—

11 (A) conduct a comprehensive study of the 

12 medicare program to identify—

13 (i) factors that facilitate provision of 

14 effective care (including, where appro15 priate, hospice care) for medicare bene16 ficiaries with chronic conditions; and 

17 (ii) factors that impede provision of 

18 such care for such beneficiaries, 

19 including the issues studied under paragraph 

20 (2); and 

21 (B) submit the report described in sub22 section (b). 

23 (2) ISSUES STUDIED.—The study required 

24 under paragraph (1) shall— 
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1 (A) identify inconsistent clinical, financial, 

2 or administrative requirements across provider 

3 and supplier settings or professional services 

4 with respect to medicare beneficiaries; 

5 (B) identify requirements under the pro6 gram imposed by law or regulation that—

7 (i) promote costshifting across pro8 viders and suppliers; 

9 (ii) impede provision of effective, 

10 seamless transitions across health care set11 tings, such as between hospitals, skilled 

12 nursing facilities, home health services, 

13 hospice care, and care in the home; 

14 (iii) impose unnecessary burdens on 

15 such beneficiaries and their family care16 givers; 

17 (iv) impede the establishment of ad18 ministrative information systems to track 

19 health status, utilization, cost, and quality 

20 data across providers and suppliers and 

21 provider settings; 

22 (v) impede the establishment of clin23 ical information systems that support con24 tinuity of care across settings and over 

25 time; or 
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1 (vi) impede the alignment of financial 

2 incentives among the medicare program, 

3 the medicaid program, and group health 

4 plans and providers and suppliers that fur5 nish services to the same beneficiary. 

6 (b) REPORT.—On the date that is 18 months after 

7 the date of enactment of this Act, the Institute of Medi8 cine of the National Academy of Sciences shall submit to 

9 Congress and the Secretary of Health and Human Serv10 ices a report that contains—

11 (1) a detailed statement of the findings and 

12 conclusions of the study conducted under subsection 

13 (a); and 

14 (2) recommendations to improve provision of ef15 fective care for medicare beneficiaries with chronic 

16 conditions.

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