II 

115TH CONGRESS 

1ST SESSION S. 794 

To amend title XVIII of the Social Security Act in order to improve the 

process whereby Medicare administrative contractors issue local coverage 

determinations under the Medicare program, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

MARCH 30, 2017 

Mr. ISAKSON (for himself, Mr. CARPER, Mr. BOOZMAN, and Ms. STABENOW) 

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 in order 

to improve the process whereby Medicare administrative 

contractors issue local coverage determinations under the 

Medicare 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. 

4 This Act may be cited as the ‘‘Local Coverage Deter5 mination Clarification Act of 2017’’. 


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1 SEC. 2. IMPROVEMENTS IN THE MEDICARE LOCAL COV2 ERAGE DETERMINATION (LCD) PROCESS FOR 

3 SPECIFIED LCDS. 

4 (a) LCD DEVELOPMENT PROCESS.—Section 

5 1862(l)(5) of the Social Security Act (42 U.S.C. 

6 1395y(l)(5)) is amended by adding at the end the fol7 lowing subparagraph: 

8 ‘‘(D) PROCESS FOR ISSUING SPECIFIED

9 LOCAL COVERAGE DETERMINATIONS.— 

10 ‘‘(i) IN GENERAL.—In the case of a 

11 specified local coverage determination (as 

12 defined in clause (iv)) within an area by a 

13 medicare admi‘’nistrative contractor that 

14 has entered into a contract with the Sec15 retary under section 1874A, such medicare 

16 administrative contractor must take the 

17 following actions with respect to such de18 termination before such determination may 

19 take effect: 

20 ‘‘(I) Publish on the public Inter21 net website of the medicare adminis22 trative contractor a proposed version 

23 of the specified local coverage deter24 mination (in this section referred to 

25 as a ‘draft determination’), a written 

26 rationale for the draft determination, 


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1 and a description of all evidence relied 

2 upon and considered by the medicare 

3 administrative contractor in the devel4 opment of the draft determination. 

5 ‘‘(II) Not later than 60 days 

6 after the date on which the medicare 

7 administrative contractor publishes 

8 the draft determination in accordance 

9 with subclause (I), convene one or 

10 more open, public meetings to review 

11 the draft determination, receive com12 ments with respect to the draft deter13 mination, and secure the advice of an 

14 expert panel (such as a carrier advi15 sory committee described in chapter 

16 13 of the Medicare Program Integrity 

17 Manual in effect on August 31, 

18 2015), with respect to the draft deter19 mination. The medicare administra20 tive contractor shall make available 

21 means for the public to attend such 

22 meetings remotely, such as via tele23 conference. 

24 ‘‘(III) With respect to each meet25 ing convened pursuant to subclause 


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1 (II), post on the public Internet 

2 website of the medicare administrative 

3 contractor, not later than 14 days 

4 after such meeting is convened, a 

5 record of the meeting minutes for 

6 such meeting. 

7 ‘‘(IV) Provide a period for sub8 mission of written public comment on 

9 such draft determination that begins 

10 on the date on which all records re11 quired to be posted with respect to 

12 such draft determination under sub13 clause (III) are so posted and that is 

14 not fewer than 30 days in duration. 

15 ‘‘(ii) FINALIZING A SPECIFIED LOCAL

16 COVERAGE DETERMINATION.—A medicare 

17 administrative contractor that has entered 

18 into a contract with the Secretary under 

19 section 1874A shall, with respect to a spec20 ified local coverage determination, post on 

21 the public Internet website of the medicare 

22 administrative contractor the following in23 formation before the specified local cov24 erage determination (in this section reVerDate Sep 11 2014 04:07 Apr 06, 2017 Jkt 069200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S794.IS S794

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1 ferred to as the ‘final determination’) takes 

2 effect— 

3 ‘‘(I) a response the issues raised 

4 at meetings convened pursuant to 

5 clause (i)(II) with respect to the draft 

6 determination; 

7 ‘‘(II) the rationale for the final 

8 determination; 

9 ‘‘(III) in the case that the medi10 care administrative contractor consid11 ered qualifying evidence in the devel12 opment of the determination that was 

13 not described in the written notice 

14 provided pursuant to clause (i)(I), a 

15 description of such qualifying evi16 dence; and 

17 ‘‘(IV) an effective date for the 

18 final determination that is not less 

19 than 30 days after the date on which 

20 such determination is so posted. 

21 ‘‘(iii) LIMITATION ON DETERMINA22 TIONS ACROSS JURISDICTIONS.—Notwith23 standing any plan under section 

24 1862(l)(5)(A), in the case of a contract 

25 with a medicare administrative contractor 


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1 under section 1874A, such medicare ad2 ministrative contractor may not finalize a 

3 specified local coverage determination pur4 suant to clause (ii) with respect to a geo5 graphic area that applies, or has the effect 

6 of applying, outside such area. In the case 

7 that such a medicare administrative con8 tractor wishes to adopt, with respect to a 

9 specific geographic area a specified local 

10 coverage determination developed for a dif11 ferent geographic area, such medicare ad12 ministrative contractor may not so adopt 

13 such determination unless, prior to so 

14 adopting such determination, such medi15 care administrative contractor independ16 ently evaluates and considers the quali17 fying evidence supporting the determina18 tion as applicable to such specific geo19 graphic area and makes a local coverage 

20 determination for such area in accordance 

21 with this subparagraph. 

22 ‘‘(iv) SPECIFIED LOCAL COVERAGE

23 DETERMINATION DEFINED.—For purposes 

24 of this subparagraph, the term ‘specified 


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1 local coverage determination’ means, with 

2 respect to a geographic area— 

3 ‘‘(I) a new local coverage deter4 mination (regardless of whether such 

5 determination made by a medicare ad6 ministrative contractor that has en7 tered into a contract with the Sec8 retary under section 1874A and is 

9 based upon a specified local coverage 

10 determination that previously has 

11 been made with respect to another ge12 ographic area, or by another such 

13 medicare administrative contractor); 

14 ‘‘(II) a revised local coverage de15 termination for such geographic area 

16 that restricts one or more existing 

17 coverage criteria for such area (such 

18 as by adding noncovered indications 

19 to an existing local coverage deter20 mination or by deleting previously cov21 ered ICD–9 or ICD–10 codes); 

22 ‘‘(III) a revised local coverage de23 termination that makes a substantive 

24 revision to one or more existing local 

25 coverage determinations; and 


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1 ‘‘(IV) any other local coverage 

2 determination specified by the Sec3 retary pursuant to regulations. 

4 ‘‘(v) QUALIFYING EVIDENCE DE5 FINED.—For purposes of this subpara6 graph, the term ‘qualifying evidence’ 

7 means either of the following: 

8 ‘‘(I) Scientific evidence published 

9 in peer-reviewed medical literature, 

10 such as randomized clinical trials or 

11 other studies. 

12 ‘‘(II) A general consensus of the 

13 applicable medical community (such 

14 as a consensus evinced through a rec15 ognized standard of practice in such 

16 medical community) that is supported 

17 by information provided by a recog18 nized medical authority, such as a 

19 professional medical society.’’. 

20 (b) LCD RECONSIDERATION PROCESS.—Section 

21 1869(f) of the Social Security Act (42 U.S.C. 1395ff(f)) 

22 is amended— 

23 (1) in paragraph (2)(A), by inserting ‘‘(and, as 

24 applicable, the limitations under paragraphs (8) and 

25 (9))’’ before the colon; 


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1 (2) in paragraph (5), by inserting ‘‘(other than 

2 under paragraphs (8) and (9))’’ after ‘‘this sub3 section’’; 

4 (3) by redesignating paragraph (8) as para5 graph (12); and 

6 (4) by inserting after paragraph (7) the fol7 lowing new paragraphs: 

8 ‘‘(8) MEDICARE ADMINISTRATIVE CONTRACTOR

9 RECONSIDERATION PROCESS FOR SPECIFIED LOCAL

10 COVERAGE DETERMINATIONS.—For purposes of 

11 paragraph (2)(A), the limitations described in this 

12 paragraph are that, upon the filing of a request by 

13 an interested party with respect to a specified local 

14 coverage determination by a medicare administrative 

15 contractor that has entered into a contract with the 

16 Secretary under section 1874A, the medicare admin17 istrative contractor shall reconsider such determina18 tion in accordance with the following process: 

19 ‘‘(A) Not later than 30 days after such a 

20 request is filed with the medicare administrative 

21 contractor by the interested party with respect 

22 to such determination, the medicare administra23 tive contractor shall— 

24 ‘‘(i) determine whether the request is 

25 an applicable request; and 


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1 ‘‘(ii) in the case that the request is 

2 not an applicable request, inform the inter3 ested party of the reasons why such re4 quest is not an applicable request. 

5 ‘‘(B) In the case that the medicare admin6 istrative contractor determines under subpara7 graph (A) that the request described in such 

8 subparagraph is an applicable request, the 

9 medicare administrative contractor shall, not 

10 later than 90 days after the date on which the 

11 request was filed with the medicare administra12 tive contractor, take the actions described in 

13 subparagraphs (C), (D), and (E) with respect 

14 to the determination. 

15 ‘‘(C) The action described in this subpara16 graph is the action of specifying whether any of 

17 the following statements is applicable to the de18 termination: 

19 ‘‘(i) The determination did not apply, 

20 or inaccurately applied, qualifying evidence 

21 relevant to such determination. 

22 ‘‘(ii) The determination used language 

23 that exceeded the scope of the intended 

24 purpose of the determination. 


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1 ‘‘(iii) The determination was incorrect 

2 in its determination of whether such item 

3 or service is reasonable and necessary for 

4 the diagnosis or treatment of illness or in5 jury under section 1862(a)(1)(A). 

6 ‘‘(iv) The determination failed to de7 scribe, with respect to such an item or 

8 service, the clinical conditions to be used 

9 for purposes of determining whether such 

10 item or service is reasonable and necessary 

11 for the diagnosis or treatment of illness or 

12 injury under section 1862(a)(1)(A). 

13 ‘‘(v) The determination does not apply 

14 with respect to items or services to which 

15 it was intended to apply. 

16 ‘‘(vi) The determination is erroneous 

17 for another reason that the medicare ad18 ministrative contractor identifies. 

19 ‘‘(D) The action described in this subpara20 graph, with respect to the determination, is the 

21 action of taking, based on the specification 

22 under subparagraph (C) of whether any of the 

23 statements in such subparagraph applied to 

24 such determination, one or more of the fol25 lowing actions: 


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1 ‘‘(i) Making no change in the deter2 mination. 

3 ‘‘(ii) Rescinding a part of the deter4 mination (including, as applicable, the en5 tire determination). 

6 ‘‘(iii) Modifying the determination to 

7 restrict the coverage provided under this 

8 title for an item or service that is subject 

9 to the determination. 

10 ‘‘(iv) Modifying the determination to 

11 expand the coverage provided under this 

12 title for an item or service that is subject 

13 to the determination. 

14 ‘‘(E) The action described in this subpara15 graph is the action of making publicly available 

16 a written description of the action taken under 

17 subparagraph (D) with respect to the deter18 mination. 

19 ‘‘(9) AGENCY EVALUATION OF RECONSIDER20 ATION DECISION.—For purposes of paragraph 

21 (2)(A), the limitations described in this paragraph 

22 are that, in the case that an interested party that 

23 filed an applicable request under paragraph (8) with 

24 respect to a specified local coverage determination 

25 files with the Secretary, on a date that is not later 


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1 than 120 days after the date on which a medicare 

2 administrative contractor takes an action described 

3 under paragraph (8)(D) with respect to such deter4 mination, an appeal with respect to such decision in 

5 such form and manner as the Secretary may require, 

6 the Secretary shall, not later than 30 days after 

7 such appeal is filed— 

8 ‘‘(A) specify which, if any, of the state9 ments in subparagraph (C) of paragraph (8) is 

10 applicable to the determination; and 

11 ‘‘(B) based on such specification, take one 

12 of the actions described in subparagraph (D) of 

13 such paragraph with respect to the determina14 tion. 

15 The Secretary shall apply subparagraph (A) as 

16 though the reference to ‘the medicare administrative 

17 contractor’ in clause (vi) of paragraph (8)(C) were 

18 a reference to the Secretary. 

19 ‘‘(10) DEFINITIONS APPLICABLE TO PARA20 GRAPHS (8) AND (9).—For purposes of paragraphs 

21 (8) and (9): 

22 ‘‘(A) The term ‘applicable request’ means 

23 a request that is submitted in fiscal year 2018 

24 or a subsequent fiscal year, that is solely with 

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1 tion, and that includes a description of the ra2 tionale for such request and any evidence sup3 porting such request. For purposes of the pre4 ceding sentence, the Secretary may not require, 

5 as a condition of treating a request with respect 

6 to such a determination as an applicable re7 quest, that the request contain qualifying evi8 dence that was not considered in the develop9 ment of such determination. 

10 ‘‘(B) The term ‘interested party’ means, 

11 with respect to a specified local coverage deter12 mination within an area by a medicare adminis13 trative contractor that has entered into a con14 tract with the Secretary under section 1874A— 

15 ‘‘(i) a provider of services or supplier 

16 that, in such area, furnishes, provides, or 

17 supplies items or services that are subject 

18 to such determination; or 

19 ‘‘(ii) an organization that represents 

20 such a provider of services or supplier. 

21 ‘‘(C) The term ‘qualifying evidence’ has 

22 the meaning given such term by clause (v) of 

23 section 1862(l)(5)(D). 


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1 ‘‘(D) The term ‘specified local coverage de2 termination’ has the meaning given such term 

3 by clause (iv) of such section. 

4 ‘‘(11) APPOINTMENT OF OMBUDSMAN.— 

5 ‘‘(A) IN GENERAL.—The Secretary shall, 

6 within the Centers for Medicare & Medicaid 

7 Services, appoint a Medicare Reviews and Ap8 peals Ombudsman (referred to in this para9 graph as the ‘Ombudsman’). 

10 ‘‘(B) DUTIES.—The Ombudsman shall, 

11 with respect to specified local coverage deter12 minations, carry out the following duties: 

13 ‘‘(i) Provide interested parties (as de14 fined in paragraph (10)(B)) with adminis15 trative and technical assistance in filing re16 quests under paragraph (8) and appeals 

17 under paragraph (9). 

18 ‘‘(ii) Make publicly available in a uni19 form, consistent, and easily understood for20 mat the following information for each 12- 

21 month period: 

22 ‘‘(I) The number of requests filed 

23 with medicare administrative contrac24 tors under paragraph (8), and of apVerDate Sep 11 2014 04:07 Apr 06, 2017 Jkt 069200 PO 00000 Frm 00015 Fmt 6652 Sfmt 6201 E:\BILLS\S794.IS S794

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1 peals filed with the Secretary under 

2 paragraph (9), during such period. 

3 ‘‘(II) With respect to such re4 quests during such period, the number 

5 of times that medicare administrative 

6 contractors took, with respect to the 

7 actions described subparagraph 

8 (A)(iv) of such paragraph, each such 

9 action. 

10 ‘‘(III) With respect to such ap11 peals during such period, the number 

12 of times that the Secretary took each 

13 such action. 

14 ‘‘(IV) With respect to the num15 bers made available under subclauses 

16 (I), (II), and (III), the number of 

17 each such number that is attributable 

18 to— 

19 ‘‘(aa) each medicare admin20 istrative contractor; and 

21 ‘‘(bb) each interested party 

22 (as defined in paragraph 

23 (10)(B)). 

24 ‘‘(V) Measures of the responsive25 ness of medicare administrative conVerDate Sep 11 2014 04:07 Apr 06, 2017 Jkt 069200 PO 00000 Frm 00016 Fmt 6652 Sfmt 6201 E:\BILLS\S794.IS S794

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1 tractors with respect to requests filed 

2 with such medicare administrative 

3 contractors under paragraph (8). 

4 ‘‘(VI) Recommendations to the 

5 Secretary with respect to ways to im6 prove— 

7 ‘‘(aa) the efficacy and effi8 ciency of the process described in 

9 paragraph (8); and 

10 ‘‘(bb) communication with 

11 individuals entitled to benefits 

12 under part A or enrolled under 

13 part B, providers of services, and 

14 suppliers regarding such proc15 ess.’’. 

16 (c) PROMULGATION OF REGULATIONS; APPLICATION

17 DATE.—The Secretary of Health and Human Services 

18 shall promulgate regulations to carry out paragraph 

19 (5)(D) of section 1862(l) of the Social Security Act (42 

20 U.S.C. 1395y(l)), as added by subsection (a), and para21 graphs (8) and (9) of section 1869(f) of such Act (42 

22 U.S.C. 1395ff(f)), as inserted by subsection (b), in such 

23 a manner as to ensure that the processes described in such 

24 paragraphs are fully implemented by October 1, 2017. 

Æ 


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