I

104TH CONGRESS

2D SESSION H. R. 3142

To establish a demonstration project to provide that the Department of

Defense may receive Medicare reimbursement for health care services

provided to certain Medicare-eligible covered military beneficiaries.

IN THE HOUSE OF REPRESENTATIVES

MARCH 21, 1996

Mr. HEFLEY introduced the following bill; which was referred to the Committee on Ways and Means, and in addition to the Committees on Commerce, and National Security, 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 establish a demonstration project to provide that the

Department of Defense may receive Medicare reimbursement for health care services provided to certain Medicare-eligible covered military beneficiaries.

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 ‘‘Uniformed Services

5 Medicare Subvention Demonstration Project Act’’.

6 SEC. 2. DEFINITIONS.

7 For purposes of this Act:
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1 (1) MEDICARE-ELIGIBLE COVERED MILITARY

2 BENEFICIARY.—The term ‘‘medicare-eligible covered

3 military beneficiary’’ means a beneficiary under

4 chapter 55 of title 10, United States Code, including

5 a beneficiary under section 1074(a) of such title,

6 who is entitled to benefits under part A of title XVII

7 of the Social Security Act (42 U.S.C. 1395 et seq.).

8 (2) TRICARE PROGRAM.—The term ‘‘TRICARE

9 program’’ means the managed health care program that

10 is established by the Secretary of Defense under the au11 thority of chapter 55 of title 10, United States Code, prin12 cipally section 1097 of such title, and includes the com13 petitive selection of contractors to financially underwrite

14 the delivery of health care services under the Civilian

15 Health and Medical Program of the Uniformed Services.

16 (3) MILITARY TREATMENT FACILITY.—The term

17 ‘‘military treatment facility’’ means a facility referred to

18 in section 1074(a) of title 10, United States Code.

19 SEC. 3. ESTABLISHMENT.

20 (a) IN GENERAL.—Not later than 180 days after the

21 date of the enactment of this Act, the Secretary of Defense

22 and the Secretary of Health and Human Services shall

23 jointly establish a demonstration project to provide the

24 Department of Defense with reimbursement, in accord25 ance with section 4, from the medicare program under
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1 title XVII of the Social Security Act (42 U.S.C. 1395 et

2 seq.) for health services provided to certain medicare-eligi3 ble covered military beneficiaries.

4 (b) GEOGRAPHIC REGIONS.—The demonstration

5 project established under this section shall be conducted

6 in one or more geographic regions in which the TRICARE

7 program has been implemented.

8 (c) DURATION.—The demonstration project estab9 lished under this section shall be conducted for a period

10 not to exceed 2 years.

11 (d) REPORTING.—

12 (1) IN GENERAL.—

13 (A) FIRST ANNUAL REPORT.—Not later

14 than 15 months after the demonstration project

15 under this section has been established, the

16 Secretary of Defense and the Secretary of

17 Health and Human Services shall jointly submit

18 to Congress a report including the information

19 described in paragraph (2).

20 (B) FINAL REPORT.—Not later than 90

21 days after the termination of the demonstration

22 project, the Secretary shall jointly submit to

23 Congress a final report including the informa24 tion described in paragraph (2).
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1 (2) INFORMATION DESCRIBED.—The informa2 tion described in this paragraph includes the follow3 ing:

4 (A) The number of medicare-eligible cov5 ered military beneficiaries opting to participate

6 in the demonstration project established under

7 this section instead of receiving health benefits

8 through another health insurance plan (includ9 ing through the medicare program).

10 (B) Whether, and in what manner, easier

11 access to the military treatment system affects

12 the number of medicare-eligible covered military

13 beneficiaries receiving health benefits under the

14 medicare program.

15 (C) A list of the health insurance plans

16 and programs that were the primary payers for

17 medicare-eligible covered military beneficiaries

18 during the year prior to such beneficiary’s par19 ticipation in the demonstration project and the

20 distribution of enrollment of such beneficiaries

21 in such plans and programs.

22 (D) The total number of medicare-eligible

23 covered military beneficiaries who participated

24 in the project during the preceding year and the

25 number of such beneficiaries who were entitled
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1 to benefits under part A of title XVIII of the

2 Social Security Act (42 U.S.C. 1395 et seq.)

3 and were not enrolled under part B of such

4 title.

5 (E) An identification of cost-shifting (if

6 any) among medical care programs as a result

7 of the demonstration project and a description

8 of the nature of any such cost-shifting.

9 (F) An analysis of how the demonstration

10 project affects the overall accessibility of the

11 military treatment system and the amount of

12 space available for point-of-service care and a

13 description of the unintended effects (if any)

14 upon the normal treatment priority system.

15 (G) A description of the difficulties (if any)

16 experienced by the Department of Defense in

17 managing the demonstration project.

18 (H) A description of the effects of the

19 demonstration project on military treatment fa20 cility readiness and training and the probable

21 effects of the project on overall Department of

22 Defense medical readiness and training.

23 (I) A description of the effects that the

24 demonstration project, if permanent, would be

25 expected to have on the overall budget of the
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1 military health care system and the budgets of

2 individual military treatment facilities.

3 (J) Whether the demonstration project af4 fects the cost to the Department of Defense of

5 prescription drugs or the accessibility, availabil6 ity, and cost of such drugs to program bene7 ficiaries.

8 SEC. 4. REIMBURSEMENT AMOUNTS.

9 (a) PAYMENT TO DEPARTMENT OF DEFENSE.—The

10 Secretary of Health and Human Services shall make

11 monthly payments to the Department of Defense from the

12 Federal Hospital Insurance Trust Fund and the Federal

13 Supplementary Medical Insurance Trust Fund (allocated

14 between each Trust Fund in an amount to be determined

15 by the Secretary of Health and Human Services based on

16 the relative weight that benefits from each Trust Fund

17 contribute to the amounts determined under this sub18 section) in an amount equal to the sum of—

19 (1) the payments determined under subsection

20 (b) with respect to medicare-eligible covered military

21 beneficiaries who are enrolled in the TRICARE pro22 gram; and

23 (2) the payments determined under subsection

24 (c) with respect to such beneficiaries who are not en25 rolled in the TRICARE program.
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1 (b) TRICARE PAYMENTS.—

2 (1) IN GENERAL.—The amount of payment de3 termined under this subsection is an amount equal

to 1 4 ⁄12 of the amount determined under paragraph

5 (2) for each medicare-eligible covered military bene6 ficiary enrolled during the year in the TRICARE

7 program in a geographic region in which the dem8 onstration project is in operation, but only if such

9 beneficiary’s enrollment is in excess of the minimum

10 enrollment number determined under subsection

11 (d)(1)(A) for such geographic region.

12 (2) AMOUNT DETERMINED.—The amount de13 termined under this paragraph is an amount equal

14 to—

15 (A) in the case of an individual entitled to

16 benefits under part A and enrolled under part

17 B of title XVIII of the Social Security Act, 93

18 percent of the average adjusted per capita cost

19 determined under section 1876(a)(4) of the So20 cial Security Act (42 U.S.C. 1395mm(a)(4)) for

21 such year; or

22 (B) in the case of an individual entitled to

23 benefits under part A and not enrolled under

24 part B of such title, an amount equal to the

25 amount determined under subparagraph (A) at-
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1 tributable to services covered by and expenses

2 otherwise reimbursable under part A of such

3 title only.

4 (c) TREATMENT AT A MILITARY TREATMENT FACIL5 ITY.—The amount of payment determined under this sub6 section is an amount equal to the sum of the Secretary’s

7 estimates of the amounts determined for each health serv8 ice (using a DRG equivalent and fee schedule equivalent

9 scale developed by the Secretary of Health and Human

10 Services) provided during the month for which the pay11 ment is made under subsection (a) to each medicare-eligi12 ble covered military beneficiary (other than a beneficiary

13 who is enrolled in the TRICARE program) in a military

14 treatment facility located in a geographic region in which

15 the demonstration project is in operation, but only if such

level is in excess of 1 16 ⁄12 of the minimum level of health

17 services described under subsection (d)(1)(B) for such ge18 ographic region.

19 (d) ESTABLISHMENT OF BASE LEVEL OF COV20 ERAGE.—

21 (1) IN GENERAL.—Prior to the establishment of

22 the demonstration project under this Act and subject

23 to paragraph (2), the Secretary of Defense and the

24 Secretary of Health and Human Services shall joint25 ly estimate, based on the best available data—
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1 (A) a minimum enrollment number of med2 icare-eligible covered military beneficiaries who

3 are required to enroll in the TRICARE pro4 gram during a year in each geographic region

5 in which the demonstration project is in oper6 ation before the Department of Defense may re7 ceive payment under subsection (a)(1); and

8 (B) a minimum level of health services

9 (using a DRG equivalent and fee schedule

10 equivalent scale developed by the Secretary of

11 Health and Human Services) provided to medi12 care-eligible covered military beneficiaries (other

13 than beneficiaries enrolled in the TRICARE

14 program) during a year through a military

15 treatment facility in each geographic region in

16 which the demonstration project is in operation

17 before the Department of Defense may receive

18 payment under subsection (a)(2).

19 (2) DETERMINATION OF BASELINE COSTS.—

20 The Secretary of Defense and the Secretary of

21 Health and Human Services shall establish the mini22 mum enrollment number under paragraph (1)(A)

23 and the minimum level of health services under

24 paragraph (1)(B) such that the projected expendi25 tures by the Department of Defense for such num-
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1 ber of medicare-eligible covered military beneficiaries

2 and such level of services provided to such bene3 ficiaries by the Department of Defense is equivalent

4 to the projected expenditures that would have been

5 made by the Department for such beneficiaries if the

6 demonstration project under this Act had not been

7 established.

8 (3) UPPER REIMBURSEMENT LIMITS.—The Sec9 retary of Defense and the Secretary of Health and

10 Human Services shall jointly establish a maximum

11 number of medicare-eligible covered military bene12 ficiaries and maximum level of health services for

13 which payment may be made by the Secretary of

14 Health and Human services under subsection (a).

15 (e) TRICARE PROGRAM ENROLLMENT FEE WAIV16 ER.—The Secretary of Defense shall waive the enrollment

17 fee applicable to any individual enrolled in the TRICARE

18 program for whom reimbursement in the amount deter19 mined under subsection (b)(2)(A) is received under sub20 section (b)(1).

21 SEC. 5. MEDICARE SUBVENTION FUND.

22 (a) ESTABLISHMENT.—There is hereby established in

23 the Treasury of the United States a revolving fund known

24 as the Medicare Subvention Fund (hereafter in this sec25 tion referred to as the ‘‘Fund’’).
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1 (b) USE OF FUNDS.—The Fund shall be available to

2 the Secretary of Defense, as so provided in appropriations

3 Acts from funds otherwise appropriated to the Depart4 ment of Defense, and without fiscal year limitation—

5 (1) to make payments to the Secretary of

6 Health and Human Services for deposit into the

7 Federal Hospital Insurance Trust Fund and the

8 Federal Supplementary Medical Insurance Trust

9 Fund in order to reimburse such Funds for addi10 tional costs to such Trust Funds resulting from the

11 operation of the demonstration project established

12 under this Act;

13 (2) to provide for the participation of medicare14 eligible covered military beneficiaries in excess of the

15 maximum enrollment number and maximum level of

16 health services established under section 4(d)(1);

17 (3) to provide for payment of administrative ex18 penses associated with the demonstration project es19 tablished under this Act; and

20 (4) if amounts are available in the Fund after

21 expenditures are made under paragraphs (1)

22 through (3), for any other lawful purpose for which

23 the Secretary of Defense may expend funds.

24 (c) NO FUNDS AVAILABLE.—The Secretary of De25 fense may, if inadequate amounts are available in the
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1 Fund, limit the enrollment of medicare-eligible covered

2 military beneficiaries in the demonstration project estab3 lished under this Act.

4 (d) AUTHORIZATION OF APPROPRIATIONS.—For

5 each of fiscal years 1997 and 1998, there are authorized

6 to be appropriated from funds otherwise appropriated to

7 the Department of Defense, for deposit in the Fund such

8 sums as may be necessary to carry out the purposes de9 scribed in paragraphs (1) through (3) of subsection (c).

10 Any amounts appropriated in accordance with this sub11 section shall not be taken into account in establishing ap12 propriations levels for the Department of Defense health

13 affairs budget.

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