I 

108TH CONGRESS 

2D SESSION H. R. 3790

To impose a moratorium on payments for inpatient hospital services in 

additional long-term care hospital beds under the Medicare Program. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 10, 2004

Mr. STARK introduced the following bill; which was referred to the Committee 

on Ways and Means 

A BILL

To impose a moratorium on payments for inpatient hospital 

services in additional long-term care hospital beds under 

the Medicare Program.

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 ‘‘Long-term Care Hos5 pital Moratorium Act of 2004’’. 

6 SEC. 2. FINDINGS. 

7 Congress finds the following: 

8 (1) Long-term care hospitals are one of four 

9 types of post-acute care settings that are reimbursed 

10 under the Medicare program. 
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1 (2) There has been substantial growth in the 

2 number of these hospitals over the past decade. 

3 Since 1993, the number of long-term care hospitals 

4 has increased over 275 percent from 109 to 300 fa5 cilities. 

6 (3) Corresponding to the increase in number of 

7 these facilities is a rapid increase in Medicare spend8 ing on long-term care hospitals. Medicare spending 

9 has jumped over 500 percent from $398 million in 

10 1993 to an anticipated 2.3 billion in 2005. 

11 (4) Long-term care hospitals are the most ex12 pensive on average of all the post acute alternatives, 

13 currently costing approximately $35,700 per patient 

14 episode. Current earnings and margins for these 

15 hospitals are significantly higher than for com16 parable Medicare reimbursed clinical service pro17 grams. 

18 (5) There is evidence that patients are being 

19 admitted into long-term care hospitals when services 

20 can be provided in other less expensive post-acute 

21 care settings. 

22 (6) These trends raise questions about—

23 (A) the clinical need to support the rapid 

24 growth in long-term care hospitals; 
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1 (B) the appropriateness of the current 

2 Medicare payment system for long-term care 

3 hospital services; and 

4 (C) the extent to which clinical admissions 

5 criteria for long-term care hospital patients can 

6 be modified so as to minimize the acceptance of 

7 patients into these settings that can be appro8 priately treated in alternative, less costly post9 acute settings. 

10 (7) A temporary moratorium on recognizing ad11 ditional long-term care hospital beds is appropriate 

12 until these questions are answered, in order to en13 sure that beneficiaries are receiving the treatment 

14 they require and that Medicare funds are being pru15 dently spent. 

16 SEC. 3. MORATORIUM ON MEDICARE PAYMENT FOR INPA17 TIENT HOSPITAL SERVICES IN ADDITIONAL 

18 LONG-TERM CARE HOSPITAL BEDS. 

19 (a) IN GENERAL.—Notwithstanding any other provi20 sion of law, except as provided in subsection (b), no pay21 ment shall be made under section 1886 of the Social Secu22 rity Act (42 U.S.C. 1395ww) for inpatient hospital serv23 ices provided in a long-term care hospital unless such serv24 ices were provided for services furnished for a patient in 

25 a bed which was either in operation or in development (as 
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1 determined by the Secretary) as of the date of the intro2 duction of the Long-term Care Hospital Moratorium Act 

3 of 2004. 

4 (b) TERMINATION OF MORATORIUM.—

5 (1) IN GENERAL.—The Secretary may termi6 nate the moratorium under subsection (a) if the Sec7 retary determines that adequate information is ob8 tained and any appropriate interventions are imple9 mented to ensure that beneficiaries within long-term 

10 care hospitals are receiving the treatment they re11 quire and that Medicare funds allocated to these 

12 hospitals are being prudently spent. 

13 (2) CONDITION.— The Secretary shall only 

14 make such determination based on the Secretary 

15 judgment that there is adequate evidence—

16 (A) of a clinical need for a growth in the 

17 number of beds in long-term care hospitals; 

18 (B) that an appropriate reimbursement 

19 system and rate is in place for Medicare pay20 ment for inpatient hospital services in such hos21 pitals; and 

22 (C) of a clinical admission policy for such 

23 hospitals that minimizes the acceptance of pa24 tients into these settings that can be appro-
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1 priately treated in alternative, less costly post 

2 acute settings. 

3 (c) PRIOR REPORT TO CONGRESS.—If the Secretary 

4 intends to terminate the moratorium under subsection (b), 

5 the Secretary shall submit to Congress a report at least 

6 1 month before the date of such termination. Such report 

7 shall include the rationale for the termination and shall 

8 specify the evidence described in subsection (b)(2) that 

9 supports the termination of the moratorium. 

10 (d) DEFINITIONS.—For purposes of this section: 

11 (1) The term ‘‘long-term care hospital’’ means 

12 a hospital described in section 1886(d)(1)(B)(iv) of 

13 the Social Security Act (42 U.S.C. 

14 1395ww(d)(1)(B)(iv)). 

15 (2) The term ‘‘Secretary ’’ means the Secretary 

16 of Health and Human Services.

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