I

106TH CONGRESS

2D SESSION H. R. 5291

To amend titles XVIII, XIX, and XXI of the Social Security Act to make

additional corrections and refinements in the Medicare, Medicaid, and

State children’s health insurance programs, as revised by the Balanced

Budget Act of 1997.

IN THE HOUSE OF REPRESENTATIVES

SEPTEMBER 26, 2000

Mr. BLILEY (for himself, Mr. DINGELL, Mr. BILIRAKIS, Mr. BROWN of Ohio,

Mr. TAUZIN, Mr. OXLEY, Mr. UPTON, Mr. STEARNS, Mr. GILLMOR, Mr.

GREENWOOD, Mr. BURR of North Carolina, Mr. NORWOOD, Mr. ROGAN,

Mr. SHIMKUS, Mrs. WILSON, Mr. PICKERING, Mr. BRYANT, Mr. BLUNT,

Mr. EHRLICH, Ms. MCCARTHY of Missouri, Mr. LUTHER, Mr. ALLEN,

Mr. WEYGAND, Mr. WAXMAN, Mr. MARKEY, Mr. HALL of Texas, Mr.

BOUCHER, Mr. TOWNS, Mr. PALLONE, Mr. GORDON, Ms. ESHOO, Mr.

KLINK, Mr. STUPAK, Mr. ENGEL, Mr. WYNN, Mr. BARRETT of Wisconsin, and Mr. HOEFFEL) introduced the following bill; which was referred to the Committee on 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 titles XVIII, XIX, and XXI of the Social Security

Act to make additional corrections and refinements in

the Medicare, Medicaid, and State children’s health insurance programs, as revised by the Balanced Budget

Act of 1997.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,
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1 SECTION 1. SHORT TITLE; AMENDMENTS TO SOCIAL SECU2 RITY ACT; REFERENCES TO OTHER ACTS;

3 TABLE OF CONTENTS.

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

5 ‘‘Beneficiary Improvement and Protection Act of 2000’’.

6 (b) AMENDMENTS TO SOCIAL SECURITY ACT.—Ex7 cept as otherwise specifically provided, whenever in this

8 Act an amendment is expressed in terms of an amendment

9 to or repeal of a section or other provision, the reference

10 shall be considered to be made to that section or other

11 provision of the Social Security Act.

12 (c) REFERENCES TO OTHER ACTS.—In this Act:

13 (1) BALANCED BUDGET ACT OF 1997.—The

14 term ‘‘BBA’’ means the Balanced Budget Act of

15 1997 (Public Law 105–33).

16 (2) MEDICARE, MEDICAID, AND SCHIP BAL17 ANCED BUDGET REFINEMENT ACT OF 1999.—The

18 term ‘‘BBRA’’ means the Medicare, Medicaid, and

19 SCHIP Balanced Budget Refinement Act of 1999,

20 as enacted into law by section 1000(a)(6) of Public

21 Law 106–113 (Appendix F).

22 (d) TABLE OF CONTENTS.—The table of contents of

23 this Act is as follows:

Sec. 1. Short title; amendments to Social Security Act; references to other Acts;

table of contents.

TITLE I—BENEFICIARY IMPROVEMENTS

Sec. 101. Improving availability of QMB/SLMB application forms.
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Sec. 102. Study on limitation on State payment for medicare cost-sharing affecting access to services for qualified medicare beneficiaries.

Sec. 103. Election of periodic colonoscopy.

Sec. 104. Waiver of 24-month waiting period for medicare coverage of individuals disabled with amyotrophic lateral sclerosis (ALS).

Sec. 105. Elimination of time limitation on medicare benefits for immunosuppressive drugs.

Sec. 106. Preservation of coverage of drugs and biologicals under part B of the

medicare program.

Sec. 107. Demonstration of medicare coverage of medical nutrition therapy

services.

TITLE II—OTHER MEDICARE PART B PROVISIONS

Subtitle A—Access to Technology

Sec. 201. Annual reports on national coverage determinations.

Sec. 202. National limitation amount equal to 100 percent of national median

for new clinical laboratory test technologies; fee schedule for

new clinical laboratory tests.

Sec. 203. Clarifying process and standards for determining eligibility of devices

for pass-through payments under hospital outpatient PPS.

Sec. 204. Access to new technologies applied to screening mammography to enhance breast cancer detection.

Subtitle B—Provisions Relating to Physicians Services

Sec. 211. GAO study of gastrointestinal endoscopic services furnished in physicians offices and hospital outpatient department services.

Sec. 212. Treatment of certain physician pathology services.

Sec. 213. Physician group practice demonstration.

Sec. 214. Designation of separate category for interventional pain management

physicians.

Sec. 215. Evaluation of enrollment procedures for medical groups that retain

independent contractor physicians.

Subtitle C—Other Services

Sec. 221. 3-year moratorium on SNF part B consolidated billing requirements.

Sec. 222. Ambulatory surgical centers.

Sec. 223. 1-year extension of moratorium on therapy caps.

Sec. 224. Revision of medicare reimbursement for telehealth services.

Sec. 225. Payment for ambulance services.

Sec. 226. Contrast enhanced diagnostic procedures under hospital prospective

payment system.

Sec. 227. 10-year phased-in increase from 55 percent to 80 percent in the proportion of hospital bad debt recognized.

Sec. 228. State accreditation of diabetes self-management training programs.

Sec. 229. Update in renal dialysis composite rate.

TITLE III—MEDICARE PART A AND B PROVISIONS

Sec. 301. Home health services.

Sec. 302. Advisory opinions.

Sec. 303. Hospital geographic reclassification for labor costs for other PPS systems.
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Sec. 304. Reclassification of a metropolitan statistical area for purposes of reimbursement under the medicare program.

Sec. 305. Making the medicare dependent, small rural hospital program permanent.

Sec. 306. Option to base eligibility on discharges during any of the 3 most recent audited cost reporting periods.

Sec. 307. Identification and reduction of medical errors by peer review organizations.

Sec. 308. GAO report on impact of the Emergency Medical Treatment and Active Labor Act (EMTALA) on hospital emergency departments.

TITLE IV—MEDICARE+CHOICE PROGRAM STABILIZATION AND

IMPROVEMENTS

Subtitle A—Payment Reforms

Sec. 401. Increasing minimum payment amount.

Sec. 402. 3 percent minimum percentage update in 2001.

Sec. 403. 10-year phase in of risk adjustment based on data from all settings.

Sec. 404. Transition to revised Medicare+Choice payment rates.

Subtitle B—Administrative Reforms

Sec. 411. Effectiveness of elections and changes of elections.

Sec. 412. Medicare+Choice program compatibility with employer or union

group health plans.

Sec. 413. Uniform premium and benefits.

TITLE V—MEDICAID

Sec. 501. DSH payments.

Sec. 502. New prospective payment system for Federally-qualified health centers and rural health clinics.

Sec. 503. Optional coverage of legal immigrants under the medicaid program.

Sec. 504. Additional entities qualified to determine medicaid presumptive eligibility for low-income children.

Sec. 505. Improving welfare-to-work transition.

Sec. 506. Medicaid county-organized health systems.

Sec. 507. Medicaid recognition for services of physician assistants.

TITLE VI—STATE CHILDREN’S HEALTH INSURANCE PROGRAM

Sec. 601. Special rule for availability and redistribution of unused fiscal year

1998 and 1999 SCHIP allotments.

Sec. 602. Optional coverage of certain legal immigrants under SCHIP.

TITLE VII—EXTENSION OF SPECIAL DIABETES GRANT

PROGRAMS

Sec. 701. Extension of juvenile and Indian diabetes grant programs.
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1 TITLE I—BENEFICIARY

2 IMPROVEMENTS

3 SEC. 101. IMPROVING AVAILABILITY OF QMB/SLMB APPLI4 CATION FORMS.

5 (a) THROUGH LOCAL SOCIAL SECURITY OFFICES.—

6 (1) IN GENERAL.—Section 1804 (42 U.S.C.

7 1395b–2) is amended by adding at the end the fol8 lowing new subsection:

9 ‘‘(d) AVAILABILITY OF APPLICATION FORMS FOR

10 MEDICAL ASSISTANCE FOR MEDICARE COST-SHARING.—

11 The Secretary shall make available to the Administrator

12 of the Social Security Administration appropriate forms

13 for applying for medical assistance for medicare cost-shar14 ing under a State plan under title XIX. Such Adminis15 trator, through local offices of the Social Security Admin16 istration shall—

17 ‘‘(1) notify applicants and beneficiaries who

18 present at a local office orally of the availability of

19 such forms and make such forms available to such

20 individuals upon request; and

21 ‘‘(2) provide assistance to such individuals in

22 completing such forms and, upon request, in submit23 ting such forms to the appropriate State agency.’’.

24 (2) CONFORMING AMENDMENT.—Section

25 1902(a)(8) (42 U.S.C. 1396a(a)(8)) is amended by
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1 inserting before the semicolon at the end the fol2 lowing: ‘‘and provide application forms for medical

3 assistance for medicare cost-sharing under the plan

4 to the Secretary in order to make them available

5 through Federal offices under section 1804(d) within

6 the State’’.

7 (b) STREAMLINING APPLICATION PROCESS.—

8 (1) REQUIREMENT.—Section 1902(a)(8) (42

9 U.S.C. 1396a(a)(8)) is amended by striking ‘‘, and

10 that’’ and inserting ‘‘permit individuals to apply for

11 and obtain medical assistance for medicare cost12 sharing using the simplified uniform application

13 form developed under section 1905(p)(5), make

14 available such forms to such individuals, permit such

15 individuals to apply for such assistance by mail

16 (and, at the State option, by telephone or other elec17 tronic means) and not require them to apply in per18 son, and provide that’’.

19 (2) SIMPLIFIED APPLICATION FORM.—Section

20 1905(p) (42 U.S.C. 1396d(p)) is amended by adding

21 at the end the following new paragraph:

22 ‘‘(5)(A) The Secretary shall develop a simplified ap23 plication form for use by individuals (including both quali24 fied medicare beneficiaries and specified low-income medi25 care beneficiaries) in applying for medical assistance for
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1 medicare cost-sharing under this title. Such form shall be

2 easily readable by applicants and uniform nationally.

3 ‘‘(B) In developing such form, the Secretary shall

4 consult with beneficiary groups and the States.

5 ‘‘(C) The Secretary shall make such application

6 forms available—

7 ‘‘(i) to the Administrator of the Social Security

8 Administration for distribution through local social

9 security offices;

10 ‘‘(ii) at such other sites as the Secretary deter11 mines appropriate; and

12 ‘‘(iii) to persons upon request.’’.

13 (c) EFFECTIVE DATES.—

14 (1) The amendments made by subsection (a)

15 take effect on January 1, 2004.

16 (2) EFFECTIVE DATE.—The amendments made

17 by subsection (b) take effect 1 year after the date

18 of the enactment of this Act, regardless of whether

19 regulations have been promulgated to carry out such

20 amendments by such date. Secretary of Health and

21 Human Services shall develop the uniform applica22 tion form under the amendment made by subsection

23 (b)(2) by not later than 9 months after the date of

24 the enactment of this Act.
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1 SEC. 102. STUDY ON LIMITATION ON STATE PAYMENT FOR

2 MEDICARE COST-SHARING AFFECTING AC3 CESS TO SERVICES FOR QUALIFIED MEDI4 CARE BENEFICIARIES.

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

6 Human Services shall conduct a study to determine if ac7 cess to certain services (including mental health services)

8 for qualified medicare beneficiaries has been affected by

9 limitations on a State’s payment for medicare cost-sharing

10 for such beneficiaries under section 1902(n) of the Social

11 Security Act (42 U.S.C. 1396a(n)). As part of such study,

12 the Secretary shall analyze the effect of such payment lim13 itation on providers who serve a disproportionate share of

14 such beneficiaries.

15 (b) REPORT.—Not later than 1 year after the date

16 of the enactment of this Act the Secretary shall submit

17 to Congress a report on the study under subsection (a).

18 The report shall include recommendations regarding any

19 changes that should be made to the State payment limits

20 under section 1902(n) for qualified medicare beneficiaries

21 to ensure appropriate access to services.

22 SEC. 103. ELECTION OF PERIODIC COLONOSCOPY.

23 (a) COVERAGE.—Section 1861(pp)(1)(C) (42 U.S.C.

24 1395x(pp)(1)(C)) is amended by inserting ‘‘and in the

25 case of an individual making the election described in sec26 tion 1834(d)(4)’’ after ‘‘high risk for colorectal cancer’’.
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1 (b) ELECTION.—Section 1834(d) (42 U.S.C.

2 1395m(d)) is amended—

3 (1) in paragraph (2)(E)—

4 (A) by striking ‘‘or’’ at the end of clause

5 (i);

6 (B) by striking the period at the end of

7 clause (ii) and inserting ‘‘; or’’; and

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

9 clause:

10 ‘‘(iii) if the procedure is performed

11 within 119 months after a screening

12 colonoscopy under paragraph (4).’’;

13 (2) in paragraph (3)(A), by inserting ‘‘and for

14 individuals making the election described in para15 graph (4)’’ after ‘‘1861(pp)(2))’’;

16 (3) in paragraph (3)(E), by adding at the end

17 the following: ‘‘No payment may be made under this

18 part for a colorectal cancer screening test consisting

19 of a screening colonoscopy for individuals making

20 the election described in paragraph (4) if the proce21 dure is performed within the 119 months after a

22 previous screening colonoscopy or within 47 months

23 after a screening flexible sigmoidoscopy.’’; and

24 (4) by adding at the end the following new

25 paragraph:
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1 ‘‘(4) ELECTION OF SCREENING COLONOSCOPY

2 INSTEAD OF SCREENING SIGMOIDOSCOPY.—An indi3 vidual may elect, in a manner specified by the Sec4 retary, to receive a screening colonoscopy instead of

5 a screening sigmoidoscopy.’’.

6 (c) EFFECTIVE DATE.—The amendments made by

7 this section take effect on January 1, 2001.

8 SEC. 104. WAIVER OF 24-MONTH WAITING PERIOD FOR

9 MEDICARE COVERAGE OF INDIVIDUALS DIS10 ABLED WITH AMYOTROPHIC LATERAL SCLE11 ROSIS (ALS).

12 (a) IN GENERAL.—Section 226 (42 U.S.C. 426) is

13 amended—

14 (1) by redesignating subsection (h) as sub15 section (j) and by moving such subsection to the end

16 of the section, and

17 (2) by inserting after subsection (g) the fol18 lowing new subsection:

19 ‘‘(h) For purposes of applying this section in the case

20 of an individual medically determined to have amyotrophic

21 lateral sclerosis (ALS), the following special rules apply:

22 ‘‘(1) Subsection (b) shall be applied as if there

23 were no requirement for any entitlement to benefits,

24 or status, for a period longer than 1 month.
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1 ‘‘(2) The entitlement under such subsection

2 shall begin with the first month (rather than twenty3 fifth month) of entitlement or status.

4 ‘‘(3) Subsection (f) shall not be applied.’’.

5 (b) CONFORMING AMENDMENT.—Section 1837 (42

6 U.S.C. 1395p) is amended by adding at the end the fol7 lowing new subsection:

8 ‘‘(j) In applying this section in the case of an indi9 vidual who is entitled to benefits under part A pursuant

10 to the operation of section 226(h), the following special

11 rules apply:

12 ‘‘(1) The initial enrollment period under sub13 section (d) shall begin on the first day of the first

14 month in which the individual satisfies the require15 ment of section 1836(1).

16 ‘‘(2) In applying subsection (g)(1), the initial

17 enrollment period shall begin on the first day of the

18 first month of entitlement to disability insurance

19 benefits referred to in such subsection.’’.

20 (c) EFFECTIVE DATE.—The amendments made by

21 this section apply to benefits for months beginning after

22 the date of the enactment of this Act.
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1 SEC. 105. ELIMINATION OF TIME LIMITATION ON MEDI2 CARE BENEFITS FOR IMMUNOSUPPRESSIVE

3 DRUGS.

4 (a) IN GENERAL.—Section 1861(s)(2)(J) (42 U.S.C.

5 1395x(s)(2)(J)) is amended by striking ‘‘, but only’’ and

6 all that follows up to the semicolon at the end.

7 (b) EFFECTIVE DATE.—The amendment made by

8 subsection (a) shall apply to drugs furnished on or after

9 the date of the enactment of this Act.

10 SEC. 106. PRESERVATION OF COVERAGE OF DRUGS AND

11 BIOLOGICALS UNDER PART B OF THE MEDI12 CARE PROGRAM.

13 (a) IN GENERAL.—Section 1861(s)(2) (42 U.S.C.

14 1395x(s)(2)) is amended, in each of subparagraphs (A)

15 and (B), by striking ‘‘(including drugs and biologicals

16 which cannot, as determined in accordance with regula17 tions, be self-administered)’’ and inserting ‘‘(including

18 drugs and biologicals which are not usually self-adminis19 tered by the patient)’’.

20 (b) EFFECTIVE DATE.—The amendment made by

21 subsection (a) applies to drugs and biologicals adminis22 tered on or after October 1, 2000.

23 SEC. 107. DEMONSTRATION OF MEDICARE COVERAGE OF

24 MEDICAL NUTRITION THERAPY SERVICES.

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

26 Human Services shall conduct a demonstration project (in
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1 this section referred to as the ‘‘project’’) to examine the

2 cost-effectiveness of providing medical nutrition therapy

3 services under the medicare program and the financial im4 pact of providing such services under the program.

5 (b) SCOPE OF SERVICES.—

6 (1) TIME PERIOD AND LOCATIONS.—The

7 project shall be conducted—

8 (A) during a period of 5 fiscal years; and

9 (B) in the 5 States which have the highest

10 proportion of the population who are 65 years

11 of age or older.

12 (2) FUNDING.—The total amount of the pay13 ments that may be made under this section shall not

14 exceed $60,000,000 for each of the 5 fiscal years of

15 the project. Funding for the project shall be made

16 from the Federal Supplementary Medical Insurance

17 Trust Fund established under section 1841 of the

18 Social Security Act (42 U.S.C. 1395t).

19 (c) COVERAGE AS MEDICARE PART B SERVICES.—

20 (1) IN GENERAL.—Subject to the succeeding

21 provisions of this subsection, medical nutrition ther22 apy services furnished under the project shall be

23 considered to be services covered under part B of

24 title XVIII of the Social Security Act.
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1 (2) PAYMENT.—Payment for such services shall

2 be made at a rate of 80 percent of the lesser of the

3 actual charge for the services or 85 percent of the

4 amount determined under the fee schedule estab5 lished under section 1848(b) of the Social Security

6 Act (42 U.S.C. 1395w–4(b)) for the same services if

7 furnished by a physician.

8 (3) APPLICATION OF LIMITS ON BILLING.—The

9 provisions of section 1842(b)(18) of the Social Secu10 rity Act (42 U.S.C. 1395u(b)(18)) shall apply to a

11 registered dietitian or nutrition professional fur12 nishing services under the project in the same man13 ner as they to a practitioner described in subpara14 graph (C) of such section furnishing services under

15 title XVIII of such Act.

16 (d) REPORTS.—The Secretary shall submit to the

17 Committee on Ways and Means and the Committee on

18 Commerce of the House of Representatives and the Com19 mittee on Finance of the Senate interim reports on the

20 project and a final report on the project within 6 months

21 after the conclusion of the project. The final report shall

22 include an evaluation of the impact of the use of medical

23 nutrition therapy services on medicare beneficiaries and

24 on the medicare program, including any impact on reduc-
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1 ing costs under the program and improving the health of

2 beneficiaries.

3 (e) DEFINITIONS.—For purposes of this section:

4 (1) MEDICAL NUTRITION THERAPY SERV5 ICES.—The term ‘‘medical nutrition therapy serv6 ices’’ means nutritional diagnostic, therapy, and

7 counseling services for the purpose of disease man8 agement which are furnished by a registered dieti9 tian or nutrition professional (as defined in para10 graph (2)) pursuant to a referral by a physician (as

11 defined in section 1861(r)(1) of the Social Security

12 Act, 42 U.S.C. 1395x(r)(1)).

13 (2) REGISTERED DIETITIAN OR NUTRITION

14 PROFESSIONAL.—

15 (A) IN GENERAL.—Subject to subpara16 graph (B), the term ‘‘registered dietitian or nu17 trition professional’’ means an individual who—

18 (i) holds a baccalaureate or higher de19 gree granted by a regionally accredited col20 lege or university in the United States (or

21 an equivalent foreign degree) with comple22 tion of the academic requirements of a pro23 gram in nutrition or dietetics, as accred24 ited by an appropriate national accredita-
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1 tion organization recognized by the Sec2 retary for this purpose;

3 (ii) has completed at least 900 hours

4 of supervised dietetics practice under the

5 supervision of a registered dietitian or nu6 trition professional; and

7 (iii)(I) is licensed or certified as a die8 titian or nutrition professional by the State

9 in which the services are performed, or

10 (II) in the case of an individual in a

11 State which does not provide for such li12 censure or certification, meets such other

13 criteria as the Secretary establishes.

14 (B) EXCEPTION.—Clauses (i) and (ii) of

15 subparagraph (A) shall not apply in the case of

16 an individual who as of the date of the enact17 ment of this Act is licensed or certified as a die18 titian or nutrition professional by the State in

19 which medical nutrition therapy services are

20 performed.

21 (3) SECRETARY.—The term ‘‘Secretary’’ means

22 Secretary of Health and Human Services.
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1 TITLE II—OTHER MEDICARE

2 PART B PROVISIONS

3 Subtitle A—Access to Technology

4 SEC. 201. ANNUAL REPORTS ON NATIONAL COVERAGE DE5 TERMINATIONS.

6 (a) ANNUAL REPORTS.—Not later than December 1

7 of each year, beginning in 2001, the Secretary of Health

8 and Human Services shall submit to Congress a report

9 that sets forth a detailed compilation of the actual time

10 periods that were necessary to complete and fully imple11 ment any national coverage determinations that were

12 made in the previous fiscal year for items, services, or

13 medical devices not previously covered as a benefit under

14 title XVIII of the Social Security Act (42 U.S.C. 1395

15 et seq.), including, with respect to each new item, service,

16 or medical device, a statement of the time taken by the

17 Secretary to make the necessary coverage, coding, and

18 payment determinations, including the time taken to com19 plete each significant step in the process of making such

20 determinations.

21 (b) PUBLICATION OF REPORTS ON THE INTERNET.—

22 The Secretary of Health and Human Services shall pub23 lish each report submitted under subsection (a) on the

24 medicare Internet site of the Department of Health and

25 Human Services.
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1 SEC. 202. NATIONAL LIMITATION AMOUNT EQUAL TO 100

2 PERCENT OF NATIONAL MEDIAN FOR NEW

3 CLINICAL LABORATORY TEST TECH4 NOLOGIES; FEE SCHEDULE FOR NEW CLIN5 ICAL LABORATORY TESTS.

6 (a) IN GENERAL.—Section 1833(h)(4)(B)(viii) (42

7 U.S.C. 1395l(h)(4)(B)(viii)) is amended by inserting be8 fore the period the following: ‘‘(or 100 percent of such me9 dian in the case of a clinical diagnostic laboratory test per10 formed on or after January 1, 2001, that the Secretary

11 determines is a new test for which no limitation amount

12 has previously been established under this subpara13 graph)’’.

14 (b) FEE SCHEDULE FOR NEW CLINICAL LAB

15 TESTS.—

16 (1) ESTABLISHMENT OF FEE SCHEDULE FOR

17 NEW TESTS.—Section 1833(h)(1) (42 U.S.C.

18 1395l(h)(1)) is amended—

19 (A) in subparagraph (B), by striking ‘‘In’’

20 and inserting ‘‘Except for tests described in

21 subparagraph (E), in’’; and

22 (B) by inserting at the end the following

23 new subparagraph:

24 ‘‘(E) In the case of a clinical diagnostic laboratory

25 test which is described by a new code in the Health Care

26 Financing Administration Common Procedure Coding
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1 System (commonly referred to as ‘HCPCS’), for which the

2 Secretary is not able to crosswalk with a similar test with

3 an established schedule amount, the Secretary shall estab4 lish for purposes of subparagraph (A) a single fee schedule

5 amount for all areas in the following manner:

6 ‘‘(i) By not later than December 1 of each year,

7 beginning with 2001, the Secretary shall cause to

8 have published in the Federal Register (which may

9 include publication on an interim final rule basis

10 with a comment period) an interim fee schedule

11 amount for each such new test which shall apply for

12 such new tests furnished during the following year.

13 ‘‘(ii) The interim fee schedule amount for each

14 such new test shall be subject to a comment period

15 of 60 days. The Secretary shall review comments

16 and data received and make appropriate adjustments

17 to the fee schedule for each test applicable beginning

18 with the following calendar year.

19 ‘‘(iii) For years beginning with 2002, the Sec20 retary shall also cause to have published in the Fed21 eral Register by not later than December 1 of the

22 year prior to its application, the adjustments to the

23 interim fee schedule amount described in clause (ii)

24 for each such new test for which an interim fee

25 schedule amount was established for a year, includ-
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1 ing adjustments to such fee schedule amounts in re2 sponse to comments.’’.

3 (2) CONFORMING AMENDMENT TO UPDATE

4 PROVISION.—Section 1833(h)(2)(A) (42 U.S.C.

5 1395l(h)(2)(A)) is amended by striking ‘‘July 1,

6 1984,’’ and inserting the following: ‘‘July 1, 1984.

7 The fee schedules established under the previous

8 sentence and paragraph (1)(E)(3) shall be’’.

9 SEC. 203. CLARIFYING PROCESS AND STANDARDS FOR DE10 TERMINING ELIGIBILITY OF DEVICES FOR

11 PASS-THROUGH PAYMENTS UNDER HOSPITAL

12 OUTPATIENT PPS.

13 (a) IN GENERAL.—Section 1833(t)(6) (42 U.S.C.

14 1395l(t)(6)) is amended—

15 (1) by redesignating subparagraphs (C) and

16 (D) as subparagraphs (D) and (E), respectively; and

17 (2) by striking subparagraph (B) and inserting

18 the following:

19 ‘‘(B) USE OF CATEGORIES IN DETER20 MINING ELIGIBILITY OF A DEVICE FOR PASS21 THROUGH PAYMENTS.—The Secretary shall de22 termine whether a medical device meets the re23 quirements of subparagraph (A)(iv) as follows:

24 ‘‘(i) ESTABLISHMENT OF CAT25 EGORIES.—The Secretary shall establish
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1 categories of medical devices based on type

2 of medical device as follows:

3 ‘‘(I) IN GENERAL.—The Sec4 retary shall establish criteria that will

5 be used for creation of categories

6 through rulemaking (which may in7 clude use of an interim final rule with

8 comment period). Such categories

9 shall be established in a manner such

10 that no medical device is described by

11 more than one category. Such criteria

12 shall include a test of whether the av13 erage cost of devices that would be in14 cluded in a category, as estimated by

15 the Secretary, is not insignificant as

16 described in paragraph (A)(iv)(II).

17 ‘‘(II) INITIAL CATEGORIES.—The

18 categories to be applied as of the cat19 egory-based pass-through implementa20 tion date specified pursuant to sub21 clause (V) shall be established in a

22 manner such that each medical device

23 that meets the requirements of clause

24 (ii) or (iv) of subparagraph (A) as of

25 such date is included in a such a cat-
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1 egory. For purposes of the preceding

2 sentence, whether a medical device

3 meets the requirements of clause (ii)

4 or (iv) of subparagraph (A) as of such

5 date shall be determined without re6 gard to clause (ii) of this subpara7 graph and on the basis of the pro8 gram memoranda issued before such

9 date identifying medical devices that

10 meet such requirements.

11 ‘‘(III) ADDING CATEGORIES.—

12 The Secretary shall promptly establish

13 a new category of medical device

14 under this clause for any medical de15 vice that meets the requirements of

16 subparagraph (A)(iv) and for which

17 none of the categories in effect or that

18 were previously in effect (as described

19 in subparagraph (C)(iii)) is appro20 priate. The Secretary shall only estab21 lish a new category for a medical de22 vice that is described by a category

23 that was previously in effect if the

24 Secretary determines, in accord with

25 criteria established under subclause
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1 (I) of this clause, that the device rep2 resents a significant advance in med3 ical technology that is expected to sig4 nificantly improve the treatment of

5 Medicare beneficiaries.

6 (IV) DELETING CATEGORIES.—

7 The Secretary shall delete a category

8 at the close of the period for which

9 the category is in effect (as described

10 in subparagraph (C)(iii)).

11 ‘‘(V) CATEGORY-BASED PASS12 THROUGH IMPLEMENTATION DATE.—

13 For purposes of this subparagraph

14 and subparagraph (C), the ‘category15 based pass-through implementation

16 date’ is a date specified by the Sec17 retary as of which the categories es18 tablished under this clause are first

19 used for purposes of clause (ii)(I).

20 Such date may not be later than July

21 1, 2000.

22 ‘‘(ii) REQUIREMENTS TREATED AS

23 MET.—A medical device shall be treated as

24 meeting the requirements of subparagraph

25 (A)(iv) if—
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1 ‘‘(I) the device is described by a

2 category established under clause (i),

3 and

4 ‘‘(II) an application under section

5 515 of the Federal Food, Drug, and

6 Cosmetic Act has been approved with

7 respect to the device, or the device has

8 been cleared for market under section

9 510(k) of such Act, or the device is

10 exempt from the requirements of sec11 tion 510(k) of such Act pursuant to

12 subsection (l) or (m) of section 510 of

13 such Act or section 520(g) of such

14 Act, without an additional require15 ment for application or prior ap16 proval.–––

17 ‘‘(C) LIMITED PERIOD OF PAYMENT.—

18 ‘‘(i) DRUGS AND BIOLOGICALS.—The

19 payment under this paragraph with respect

20 to a drug or biological shall only apply dur21 ing a period of at least 2 years, but not

22 more than 3 years, that begins—

23 ‘‘(I) on the first date this sub24 section is implemented in the case of

25 a drug or biological described in
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1 clause (i), (ii), or (iii) of subparagraph

2 (A) and in the case of a drug or bio3 logical described in subparagraph

4 (A)(iv) and for which payment under

5 this part is made as an outpatient

6 hospital service before such first date;

7 or

8 ‘‘(II) in the case of a drug or bio9 logical described in subparagraph

10 (A)(iv) not described in subclause (I),

11 on the first date on which payment is

12 made under this part for the drug or

13 biological as an outpatient hospital

14 service.

15 ‘‘(ii) MEDICAL DEVICES.—Except as

16 provided in clause (iv), payment shall be

17 made under this paragraph with respect to

18 a medical device only if such device—

19 ‘‘(I) is described by a category of

20 medical devices established under sub21 paragraph (B)(i); and

22 ‘‘(II) is provided as part of a

23 service (or group of services) paid for

24 under this subsection and provided

25 during the period for which such cat-
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1 egory is in effect (as described in

2 clause (iii)).

3 ‘‘(iii) PERIOD FOR WHICH CATEGORY

4 IS IN EFFECT.—For purposes of this sub5 paragraph and subparagraph (B), a cat6 egory of medical devices established under

7 subparagraph (B)(i) shall be in effect for

8 a period of at least 2 years, but not more

9 than 3 years, that begins—

10 ‘‘(I) in the case of a category es11 tablished under subparagraph

12 (B)(i)(II), on the first date on which

13 payment was made under this para14 graph for any device described by

15 such category (including payments

16 made during the period before the

17 category-based pass-through imple18 mentation date); and

19 ‘‘(II) in the case of a category es20 tablished under subparagraph

21 (B)(i)(III), on the first date on which

22 payment is made under this para23 graph for any medical device that is

24 described by such category.
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1 ‘‘(iv) PAYMENTS MADE BEFORE CAT2 EGORY-BASED PASS-THROUGH IMPLEMEN3 TATION DATE.—

4 ‘‘(I) in the case of a medical de5 vice provided as part of a service (or

6 group of services) paid for under this

7 subsection and provided during the

8 period beginning on the first date on

9 which the system under this sub10 section is implemented and ending on

11 (and including) the day before the

12 category-based pass-through imple13 mentation date specified pursuant to

14 subparagraph (B)(i)(V), payment

15 shall be made in accordance with the

16 provisions of this paragraph as in ef17 fect on the day before the date of the

18 enactment of this subparagraph; and

19 ‘‘(II) notwithstanding subclause

20 (I), the Secretary shall make pay21 ments under this paragraph during

22 the period beginning one month after

23 the date of enactment of the Bene24 ficiary Improvement and Protection

25 Act of 2000 and ending on the same
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1 ending date in subclause (I) with re2 spect to any medical device that is not

3 included in a program memorandum

4 referred to in subparagraph (B)(i)(II)

5 but that is substantially similar (other

6 than with respect to the restriction in

7 subparagraph (A)(iv)(I)) to devices

8 that are so included and that the Sec9 retary determines is likely to be de10 scribed by a initial category estab11 lished under such subparagraph.’’.

12 (b) CONFORMING AMENDMENTS.—Section 1833(t) is

13 further amended—

14 (1) in paragraph (6)(D) (as redesignated by

15 subsection (a)(1)), by striking ‘‘subparagraph

16 (D)(iii)’’ in the matter preceding clause (i) and in17 serting ‘‘subparagraph (E)(iii)’’;

18 (2) in paragraph (12)(E), by striking ‘‘para19 graph (6)(B)’’ and inserting ‘‘paragraph (6)(C)’’;

20 (3) in paragraph (11)(E), by striking ‘‘addi21 tional payments (consistent with paragraph (6)(B))’’

22 and inserting ‘‘additional payments, the determina23 tion and deletion of initial and new categories (con24 sistent with subparagraphs (B) and (C) of para25 graph (6))’’; and
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1 (4) in paragraph (6)(A), by striking ‘‘the cost

2 of the device, drug, or biological’’ and inserting ‘‘the

3 cost of the drug or biological or the average cost of

4 the category of devices’’.

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

6 this section shall become effective on the date of the enact7 ment of this Act.

8 SEC. 204. ACCESS TO NEW TECHNOLOGIES APPLIED TO

9 SCREENING MAMMOGRAPHY TO ENHANCE

10 BREAST CANCER DETECTION.

11 (a) $15 INITIAL INCREASE IN PAYMENT LIMIT.—

12 Section 1834(c)(3) (42 U.S.C. 1395m(c)(3)) is

13 amended—

14 (1) in subparagraph (A)—

15 (A) by striking ‘‘subparagraph (B)’’ and

16 inserting ‘‘subparagraphs (B) and (D)’’; and

17 (B) in clause (ii), by inserting ‘‘(taking

18 into account, if applicable, subparagraph (D))’’

19 after ‘‘for the preceding year’’; and

20 (2) by adding at the end the following new sub21 paragraph:

22 ‘‘(D) INCREASE IN PAYMENT LIMIT FOR

23 NEW TECHNOLOGIES.—In the case of new tech24 nologies applied to screening mammography

25 performed beginning in 2001 and determined
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1 by the Secretary to enhance the detection of

2 breast cancer, the limit applied under this para3 graph for 2001 shall be increased by $15.’’.

4 (b) CHANGE IN REVISION OF LIMIT.—Subparagraph

5 (B) of such section is amended—

6 (1) by striking ‘‘REDUCTION OF’’ and inserting

7 ‘‘REVISIONS TO’’,

8 (2) by inserting ‘‘or new technologies described

9 in paragraph (1)(D)’’ after ‘‘1992’’, and

10 (3) by inserting ‘‘increase or’’ before ‘‘reduce’’.

11 (c) INCLUSION OF NEW TECHNOLOGY.—Section

12 1861(jj) (42 U.S.C. 1395x(jj)) is amended by inserting

13 before the period at the end the following: ‘‘, as well as

14 new technology applied to such a procedure that the Sec15 retary determines enhances the detection of breast can16 cer’’.

17 (d) EFFECTIVE DATE.—The amendments made by

18 this section apply to mammography performed on or after

19 January 1, 2001.
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1 Subtitle B—Provisions Relating to

2 Physicians Services

3 SEC. 211. GAO STUDY OF GASTROINTESTINAL ENDOSCOPIC

4 SERVICES FURNISHED IN PHYSICIANS OF5 FICES AND HOSPITAL OUTPATIENT DEPART6 MENT SERVICES.

7 (a) STUDY.—The Comptroller General of the United

8 States shall conduct a study on the appropriateness of fur9 nishing gastrointestinal endoscopic physicians services in

10 physicians offices. In conducting this study, the Comp11 troller General shall—

12 (1) review available scientific and clinical evi13 dence about the safety of performing procedures in

14 physicians offices and hospital outpatient depart15 ments;

16 (2) assess whether resource-based practice ex17 pense relative values established by the Secretary of

18 Health and Human Services under the Medicare

19 physician fee schedule under section 1848 of the So20 cial Security Act (42 U.S.C. 1395w–4) for gastro21 intestinal endoscopic services furnished in physicians

22 offices and hospital outpatient departments create

23 an incentive to furnish such services in physicians

24 offices instead of hospital outpatient departments;

25 and
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1 (3) assess the implications for access to care for

2 Medicare beneficiaries if Medicare were not to cover

3 gastrointestinal endoscopic services in physicians of4 fices. –

5 (b) REPORT.—The Comptroller General shall submit

6 a report to Congress on such study no later than July

7 1, 2002 and include such recommendations as the Comp8 troller General determines to be appropriate.

9 SEC. 212. TREATMENT OF CERTAIN PHYSICIAN PATHOLOGY

10 SERVICES.

11 (a) IN GENERAL.—When an independent laboratory

12 furnishes the technical component of a physician pathol13 ogy service to a fee-for-service medicare beneficiary who

14 is a patient of a grandfathered hospital, the Secretary of

15 Health and Human Services shall treat such component

16 as a service for which payment shall be made to the lab17 oratory under section 1848 of the Social Security Act (42

18 U.S.C. 1395w–4) and not as an inpatient hospital service

19 for which payment is made to the hospital under section

20 1886(d) of such Act (42 U.S.C. 1395ww(d)) or as an out21 patient hospital service for which payment is made to the

22 hospital under section 1834(t) of such Act (42 U.S.C.

23 1395l(t)).

24 (b) DEFINITIONS.—For purposes of this section:
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1 (1) GRANDFATHERED HOSPITAL.—The term

2 ‘‘grandfathered hospital’’ means a hospital that had

3 an arrangement with an independent laboratory that

4 was in effect as of July 22, 1999, under which a lab5 oratory furnished the technical component of physi6 cian pathology services to fee-for-service medicare

7 beneficiaries who were hospital patients and sub8 mitted claims for payment for such component to a

9 medicare carrier (and not to the hospital).

10 (2) FEE-FOR-SERVICE MEDICARE BENE11 FICIARY.—The term ‘‘fee-for-service medicare bene12 ficiary’’ means an individual who—

13 (A) is entitled to benefits under part A, or

14 enrolled under part B, of title XVIII of the So15 cial Security Act (42 U.S.C. 1395c et seq.); and

16 (B) is not enrolled in (i) a

17 Medicare+Choice plan under part C of such

18 title (42 U.S.C. 1395w–21 et seq.), (ii) a plan

19 offered by an eligible organization under section

20 1876 of such Act (42 U.S.C. 1395mm), (iii) a

21 program of all-inclusive care for the elderly

22 (PACE) under section 1898 of such Act, or (iv)

23 a social health maintenance organization

24 (SHMO) demonstration project established

25 under section 4018(b) of the Omnibus Budget
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1 Reconciliation Act of 1987 (Public Law 100–

2 203).

3 (3) MEDICARE CARRIER.—The term ‘‘medicare

4 carrier’’ means an organization with a contract

5 under section 1842 of such Act (42 U.S.C. 1395u).

6 (c) EFFECTIVE DATE.—Subsection (a) applies to

7 services furnished during the 2-year period beginning on

8 January 1, 2001.

9 (d) GAO REPORT.—

10 (1) STUDY.—The Comptroller General of the

11 United States shall—

12 (A) analyze the types of hospitals that are

13 grandfathered under subsection (a); and

14 (B) study the effects of subsection (a) on

15 hospitals, laboratories, and medicare bene16 ficiaries access to physician pathology services.

17 (2) REPORT.—The Comptroller General shall

18 submit a report to Congress on such analysis and

19 study no later than July 1, 2002. The report shall

20 include recommendations about whether the provi21 sions of subsection (a) should apply after the 2-year

22 period under subsection (c) for grandfathered hos23 pitals for either (or both) inpatient and outpatient

24 hospital services and whether such subsection should
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1 be extended to apply to other hospitals that have

2 similar characteristics to grandfathered hospitals.

3 SEC. 213. PHYSICIAN GROUP PRACTICE DEMONSTRATION.

4 Title XVIII is amended by inserting after section

5 1866 the following new sections:

6 ‘‘DEMONSTRATION OF APPLICATION OF PHYSICIAN

7 VOLUME INCREASES TO GROUP PRACTICES

8 ‘‘SEC. 1866A. (a) DEMONSTRATION PROGRAM AU9 THORIZED.—

10 ‘‘(1) IN GENERAL.—The Secretary shall con11 duct demonstration projects to test and, if proven ef12 fective, expand the use of incentives to health care

13 groups participating in the program under this title

14 that—

15 ‘‘(A) encourage coordination of the care

16 furnished to individuals under the programs

17 under parts A and B by institutional and other

18 providers, practitioners, and suppliers of health

19 care items and services;

20 ‘‘(B) encourage investment in administra21 tive structures and processes to ensure efficient

22 service delivery; and

23 ‘‘(C) reward physicians for improving

24 health outcomes.

25 ‘‘(2) ADMINISTRATION BY CONTRACT.—Except

26 as otherwise specifically provided, the Secretary may
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1 administer the program under this section in accord2 ance with section 1866B.

3 ‘‘(3) DEFINITIONS.—For purposes of this sec4 tion, terms have the following meanings:

5 ‘‘(A) PHYSICIAN.—Except as the Secretary

6 may otherwise provide, the term ‘physician’

7 means any individual who furnishes services

8 which may be paid for as physicians’ services

9 under this title .

10 ‘‘(B) HEALTH CARE GROUP.—The term

11 ‘health care group’ means a group of physicians

12 (as defined in subparagraph (A)) organized at

13 least in part for the purpose of providing physi14 cians’ services under this title. As the Secretary

15 finds appropriate, a health care group may in16 clude a hospital and any other individual or en17 tity furnishing items or services for which pay18 ment may be made under this title that is affili19 ated with the health care group under an ar20 rangement structured so that such individual or

21 entity participates in a demonstration under

22 this section and will share in any bonus earned

23 under subsection (d).

24 ‘‘(b) ELIGIBILITY CRITERIA.—
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1 ‘‘(1) IN GENERAL.—The Secretary is authorized

2 to establish criteria for health care groups eligible to

3 participate in a demonstration under this section, in4 cluding criteria relating to numbers of health care

5 professionals in, and of patients served by, the

6 group, scope of services provided, and quality of

7 care.

8 ‘‘(2) PAYMENT METHOD.—A health care group

9 participating in the demonstration under this section

10 shall agree with respect to services furnished to

11 beneficiaries within the scope of the demonstration

12 (as determined under subsection (c))—

13 ‘‘(A) to be paid on a fee-for-service basis;

14 and

15 ‘‘(B) that payment with respect to all such

16 services furnished by members of the health

17 care group to such beneficiaries shall (where de18 termined appropriate by the Secretary) be made

19 to a single entity.

20 ‘‘(3) DATA REPORTING.—A health care group

21 participating in a demonstration under this section

22 shall report to the Secretary such data, at such

23 times and in such format as the Secretary require,

24 for purposes of monitoring and evaluation of the

25 demonstration under this section.
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1 ‘‘(c) PATIENTS WITHIN SCOPE OF DEMONSTRA2 TION.—

3 ‘‘(1) IN GENERAL.—The Secretary shall specify,

4 in accordance with this subsection, the criteria for

5 identifying those patients of a health care group who

6 shall be considered within the scope of the dem7 onstration under this section for purposes of applica8 tion of subsection (d) and for assessment of the ef9 fectiveness of the group in achieving the objectives

10 of this section.

11 ‘‘(2) OTHER CRITERIA.—The Secretary may es12 tablish additional criteria for inclusion of bene13 ficiaries within a demonstration under this section,

14 which may include frequency of contact with physi15 cians in the group or other factors or criteria that

16 the Secretary finds to be appropriate.

17 ‘‘(3) NOTICE REQUIREMENTS.—In the case of

18 each beneficiary determined to be within the scope

19 of a demonstration under this section with respect to

20 a specific health care group, the Secretary shall en21 sure that such beneficiary is notified of the incen22 tives, and of any waivers of coverage or payment

23 rules, applicable to such group under such dem24 onstration.

25 ‘‘(d) INCENTIVES.—
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1 ‘‘(1) PERFORMANCE TARGET.—The Secretary

2 shall establish for each health care group partici3 pating in a demonstration under this section—

4 ‘‘(A) a base expenditure amount, equal to

5 the average total payments under parts A and

6 B for patients served by the health care group

7 on a fee-for-service basis in a base period deter8 mined by the Secretary; and

9 ‘‘(B) an annual per capita expenditure tar10 get for patients determined to be within the

11 scope of the demonstration, reflecting the base

12 expenditure amount adjusted for risk and ex13 pected growth rates.

14 ‘‘(2) INCENTIVE BONUS.—The Secretary shall

15 pay to each participating health care group (subject

16 to paragraph (4)) a bonus for each year under the

17 demonstration equal to a portion of the Medicare

18 savings realized for such year relative to the per19 formance target.

20 ‘‘(3) ADDITIONAL BONUS FOR PROCESS AND

21 OUTCOME IMPROVEMENTS.—At such time as the

22 Secretary has established appropriate criteria based

23 on evidence the Secretary determines to be suffi24 cient, the Secretary shall also pay to a participating

25 health care group (subject to paragraph (4)) an ad-
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1 ditional bonus for a year, equal to such portion as

2 the Secretary may designate of the saving to the

3 program under this title resulting from process im4 provements made by and patient outcome improve5 ments attributable to activities of the group.

6 ‘‘(4) LIMITATION.—The Secretary shall limit

7 bonus payments under this section as necessary to

8 ensure that the aggregate expenditures under this

9 title (inclusive of bonus payments) with respect to

10 patients within the scope of the demonstration do

11 not exceed the amount which the Secretary esti12 mates would be expended if the demonstration

13 projects under this section were not implemented.

14 ‘‘PROVISIONS FOR ADMINISTRATION OF DEMONSTRATION

15 PROGRAM

16 ‘‘SEC. 1866B. (a) GENERAL ADMINISTRATIVE AU17 THORITY.—

18 ‘‘(1) BENEFICIARY ELIGIBILITY.—Except as

19 otherwise provided by the Secretary, an individual

20 shall only be eligible to receive benefits under the

21 program under section 1866A (in this section re22 ferred to as the ‘demonstration program’) if such

23 individual—

24 ‘‘(A) is enrolled in under the program

25 under part B and entitled to benefits under

26 part A; and
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1 ‘‘(B) is not enrolled in a Medicare+Choice

2 plan under part C, an eligible organization

3 under a contract under section 1876 (or a simi4 lar organization operating under a demonstra5 tion project authority), an organization with an

6 agreement under section 1833(a)(1)(A), or a

7 PACE program under section 1894.

8 ‘‘(2) SECRETARY’S DISCRETION AS TO SCOPE

9 OF PROGRAM.—The Secretary may limit the imple10 mentation of the demonstration program to—

11 ‘‘(A) a geographic area (or areas) that the

12 Secretary designates for purposes of the pro13 gram, based upon such criteria as the Secretary

14 finds appropriate;

15 ‘‘(B) a subgroup (or subgroups) of bene16 ficiaries or individuals and entities furnishing

17 items or services (otherwise eligible to partici18 pate in the program), selected on the basis of

19 the number of such participants that the Sec20 retary finds consistent with the effective and ef21 ficient implementation of the program;

22 ‘‘(C) an element (or elements) of the pro23 gram that the Secretary determines to be suit24 able for implementation; or
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1 ‘‘(D) any combination of any of the limits

2 described in subparagraphs (A) through (C).

3 ‘‘(3) VOLUNTARY RECEIPT OF ITEMS AND

4 SERVICES.—Items and services shall be furnished to

5 an individual under the demonstration program only

6 at the individual’s election.

7 ‘‘(4) AGREEMENTS.—The Secretary is author8 ized to enter into agreements with individuals and

9 entities to furnish health care items and services to

10 beneficiaries under the demonstration program.

11 ‘‘(5) PROGRAM STANDARDS AND CRITERIA.—

12 The Secretary shall establish performance standards

13 for the demonstration program including, as applica14 ble, standards for quality of health care items and

15 services, cost-effectiveness, beneficiary satisfaction,

16 and such other factors as the Secretary finds appro17 priate. The eligibility of individuals or entities for

18 the initial award, continuation, and renewal of

19 agreements to provide health care items and services

20 under the program shall be conditioned, at a min21 imum, on performance that meets or exceeds such

22 standards.

23 ‘‘(6) ADMINISTRATIVE REVIEW OF DECISIONS

24 AFFECTING INDIVIDUALS AND ENTITIES FUR25 NISHING SERVICES.—An individual or entity fur-
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1 nishing services under the demonstration program

2 shall be entitled to a review by the program adminis3 trator (or, if the Secretary has not contracted with

4 a program administrator, by the Secretary) of a de5 cision not to enter into, or to terminate, or not to

6 renew, an agreement with the entity to provide

7 health care items or services under the program.

8 ‘‘(7) SECRETARY’S REVIEW OF MARKETING MA9 TERIALS.—An agreement with an individual or enti10 ty furnishing services under the demonstration pro11 gram shall require the individual or entity to guar12 antee that it will not distribute materials marketing

13 items or services under the program without the

14 Secretary’s prior review and approval;

15 ‘‘(8) PAYMENT IN FULL.—

16 ‘‘(A) IN GENERAL.—Except as provided in

17 subparagraph (B), an individual or entity re18 ceiving payment from the Secretary under a

19 contract or agreement under the demonstration

20 program shall agree to accept such payment as

21 payment in full, and such payment shall be in

22 lieu of any payments to which the individual or

23 entity would otherwise be entitled under this

24 title.
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1 ‘‘(B) COLLECTION OF DEDUCTIBLES AND

2 COINSURANCE.—Such individual or entity may

3 collect any applicable deductible or coinsurance

4 amount from a beneficiary.

5 ‘‘(b) CONTRACTS FOR PROGRAM ADMINISTRATION.—

6 ‘‘(1) IN GENERAL.—The Secretary may admin7 ister the demonstration program through a contract

8 with a program administrator in accordance with the

9 provisions of this subsection.

10 ‘‘(2) SCOPE OF PROGRAM ADMINISTRATOR CON11 TRACTS.—The Secretary may enter into such con12 tracts for a limited geographic area, or on a regional

13 or national basis.

14 ‘‘(3) ELIGIBLE CONTRACTORS.—The Secretary

15 may contract for the administration of the program

16 with—

17 ‘‘(A) an entity that, under a contract

18 under section 1816 or 1842, determines the

19 amount of and makes payments for health care

20 items and services furnished under this title; or

21 ‘‘(B) any other entity with substantial ex22 perience in managing the type of program con23 cerned.

24 ‘‘(4) CONTRACT AWARD, DURATION, AND RE25 NEWAL.—
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1 ‘‘(A) IN GENERAL.—A contract under this

2 subsection shall be for an initial term of up to

3 three years, renewable for additional terms of

4 up to three years.

5 ‘‘(B) NONCOMPETITIVE AWARD AND RE6 NEWAL FOR ENTITIES ADMINISTERING PART A

7 OR PART B PAYMENTS.—The Secretary may

8 enter or renew a contract under this subsection

9 with an entity described in paragraph (3)(A)

10 without regard to the requirements of section 5

11 of title 41, United States Code.

12 ‘‘(5) APPLICABILITY OF FEDERAL ACQUISITION

13 REGULATION.—The Federal Acquisition Regulation

14 shall apply to program administration contracts

15 under this subsection.

16 ‘‘(6) PERFORMANCE STANDARDS.—The Sec17 retary shall establish performance standards for the

18 program administrator including, as applicable,

19 standards for the quality and cost-effectiveness of

20 the program administered, and such other factors as

21 the Secretary finds appropriate. The eligibility of en22 tities for the initial award, continuation, and renewal

23 of program administration contracts shall be condi24 tioned, at a minimum, on performance that meets or

25 exceeds such standards.
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1 ‘‘(7) FUNCTIONS OF PROGRAM ADMINIS2 TRATOR.—A program administrator shall perform

3 any or all of the following functions, as specified by

4 the Secretary:

5 ‘‘(A) AGREEMENTS WITH ENTITIES FUR6 NISHING HEALTH CARE ITEMS AND SERV7 ICES.—Determine the qualifications of entities

8 seeking to enter or renew agreements to provide

9 services under the program, and as appropriate

10 enter or renew (or refuse to enter or renew)

11 such agreements on behalf of the Secretary.

12 ‘‘(B) ESTABLISHMENT OF PAYMENT

13 RATES.—Negotiate or otherwise establish, sub14 ject to the Secretary’s approval, payment rates

15 for covered health care items and services.

16 ‘‘(C) PAYMENT OF CLAIMS OR FEES.—Ad17 minister payments for health care items or serv18 ices furnished under the program.

19 ‘‘(D) PAYMENT OF BONUSES.—Using such

20 guidelines as the Secretary shall establish, and

21 subject to the approval of the Secretary, make

22 bonus payments as described in subsection

23 (c)(2)(A)(ii) to entities furnishing items or serv24 ices for which payment may be made under the

25 program.
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1 ‘‘(E) OVERSIGHT.—Monitor the compli2 ance of individuals and entities with agreements

3 under the program with the conditions of par4 ticipation.

5 ‘‘(F) ADMINISTRATIVE REVIEW.—Conduct

6 reviews of adverse determinations specified in

7 subsection (a)(6).

8 ‘‘(G) REVIEW OF MARKETING MATE9 RIALS.—Conduct a review of marketing mate10 rials proposed by an entity furnishing services

11 under the program.

12 ‘‘(H) ADDITIONAL FUNCTIONS.—Perform

13 such other functions as the Secretary may

14 specify.

15 ‘‘(8) LIMITATION OF LIABILITY.—The provi16 sions of section 1157(b) shall apply with respect to

17 activities of contractors and their officers, employ18 ees, and agents under a contract under this sub19 section.

20 ‘‘(9) INFORMATION SHARING.—Notwithstanding

21 section 1106 and section 552a of title 5, United

22 States Code, the Secretary is authorized to disclose

23 to an entity with a program administration contract

24 under this subsection such information (including

25 medical information) on individuals receiving health
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1 care items and services under the program as the

2 entity may require to carry out its responsibilities

3 under the contract.

4 ‘‘(c) RULES APPLICABLE TO BOTH PROGRAM

5 AGREEMENTS AND PROGRAM ADMINISTRATION CON6 TRACTS.—

7 ‘‘(1) RECORDS, REPORTS, AND AUDITS.—The

8 Secretary is authorized to require entities with

9 agreements to provide health care items or services

10 under the demonstration program, and entities with

11 program administration contracts under subsection

12 (b), to maintain adequate records, to afford the Sec13 retary access to such records (including for audit

14 purposes), and to furnish such reports and other

15 materials (including audited financial statements

16 and performance data) as the Secretary may require

17 for purposes of implementation, oversight, and eval18 uation of the program and of individuals’ and enti19 ties’ effectiveness in performance of such agreements

20 or contracts.

21 ‘‘(2) BONUSES.—Notwithstanding any other

22 provision of law, but subject to subparagraph

23 (B)(ii), the Secretary may make bonus payments

24 under the program from the Federal Health Insur25 ance Trust Fund and the Federal Supplementary
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1 Medical Insurance Trust Fund in amounts that do

2 not exceed the amounts authorized under the pro3 gram in accordance with the following:

4 ‘‘(A) PAYMENTS TO PROGRAM ADMINIS5 TRATORS.—The Secretary may make bonus

6 payments under the program to program ad7 ministrators.

8 ‘‘(B) PAYMENTS TO ENTITIES FURNISHING

9 SERVICES.—

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

11 (ii), the Secretary may make bonus pay12 ments to individuals or entities furnishing

13 items or services for which payment may

14 be made under the program, or may au15 thorize the program administrator to make

16 such bonus payments in accordance with

17 such guidelines as the Secretary shall es18 tablish and subject to the Secretary’s ap19 proval.

20 ‘‘(ii) LIMITATIONS.—The Secretary

21 may condition such payments on the

22 achievement of such standards related to

23 efficiency, improvement in processes or

24 outcomes of care, or such other factors as

25 the Secretary determines to be appropriate.
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1 ‘‘(3) ANTIDISCRIMINATION LIMITATION.—The

2 Secretary shall not enter into an agreement with an

3 entity to provide health care items or services under

4 the program, or with an entity to administer the

5 program, unless such entity guarantees that it will

6 not deny, limit, or condition the coverage or provi7 sion of benefits under the program, for individuals

8 eligible to be enrolled under such program, based on

9 any health status-related factor described in section

10 2702(a)(1) of the Public Health Service Act.

11 ‘‘(d) LIMITATIONS ON JUDICIAL REVIEW.—The fol12 lowing actions and determinations with respect to the

13 demonstration program shall not be subject to review by

14 a judicial or administrative tribunal:

15 ‘‘(1) Limiting the implementation of the pro16 gram under subsection (a)(2).

17 ‘‘(2) Establishment of program participation

18 standards under subsection (a)(5) or the denial or

19 termination of, or refusal to renew, an agreement

20 with an entity to provide health care items and serv21 ices under the program.

22 ‘‘(3) Establishment of program administration

23 contract performance standards under subsection

24 (b)(6), the refusal to renew a program administra25 tion contract, or the noncompetitive award or re-
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1 newal of a program administration contract under

2 subsection (b)(4)(B).

3 ‘‘(4) Establishment of payment rates, through

4 negotiation or otherwise, under a program agree5 ment or a program administration contract.

6 ‘‘(5) A determination with respect to the pro7 gram (where specifically authorized by the program

8 authority or by subsection (c)(2))—

9 ‘‘(A) as to whether cost savings have been

10 achieved, and the amount of savings; or

11 ‘‘(B) as to whether, to whom, and in what

12 amounts bonuses will be paid.

13 ‘‘(e) APPLICATION LIMITED TO PARTS A AND B.—

14 None of the provisions of this section or of the demonstra15 tion program shall apply to the programs under part C.

16 ‘‘(f) REPORTS TO CONGRESS.—Not later than two

17 years after the date of enactment of this section, and bien18 nially thereafter for six years, the Secretary shall report

19 to the Congress on the use of authorities under the dem20 onstration program. Each report shall address the impact

21 of the use of those authorities on expenditures, access, and

22 quality under the programs under this title.’’.
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1 SEC. 214. DESIGNATION OF SEPARATE CATEGORY FOR

2 INTERVENTIONAL PAIN MANAGEMENT PHY3 SICIANS.

4 With respect to services furnished on or after Janu5 ary 1, 2002, the Secretary of Health and Human Services

6 shall provide for the designation under section

7 1848(c)(3)(A) of the Social Security Act (42 U.S.C.

8 1395w–4(c)(3)(A)) of interventional pain management

9 physicians as a separate category of physician specialists.

10 SEC. 215. EVALUATION OF ENROLLMENT PROCEDURES

11 FOR MEDICAL GROUPS THAT RETAIN INDE12 PENDENT CONTRACTOR PHYSICIANS.

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

14 Human Services shall conduct an evaluation of the current

15 medicare enrollment process for medical groups that re16 tain independent contractor physicians with particular em17 phasis on hospital-based physicians, such as emergency

18 department staffing groups. In conducting the evaluation,

19 the Secretary shall—

20 (1) review the increase of individual medicare

21 provider numbers issued and the possible medicare

22 program integrity vulnerabilities of the current proc23 ess;

24 (2) assess how program integrity could be en25 hanced by the enrollment of groups that retain inde26 pendent contractor hospital-based physicians; and
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1 (3) develop suggested procedures for the enroll2 ment of these groups.

3 (b) REPORT.—Not later than 1 year after the date

4 of the enactment of this Act, the Secretary shall submit

5 to Congress a report on the evaluation conducted under

6 subsection (a).

7 Subtitle C—Other Services

8 SEC. 221. 3-YEAR MORATORIUM ON SNF PART B CONSOLI9 DATED BILLING REQUIREMENTS.

10 (a) MORATORIUM IN APPLICATION OF CONSOLI11 DATED BILLING TO SNF RESIDENTS IN NON-COVERED

12 STAYS.—Section 1842(b)(6)(E) (42 U.S.C.

13 1395u(b)(6)(E)) is amended by inserting ‘‘(on or after Oc14 tober 1, 2003)’’ after ‘‘furnished to an individual’’.

15 (b) MORATORIUM IN PROVIDER AGREEMENT PROVI16 SION.—Section 1866(a)(1)(H)(ii)(I) (42 U.S.C.

17 1395cc(a)(1)(H)(ii)(I) is amended by inserting ‘‘in the

18 case of a resident who is in a stay covered under part

19 A, and for services furnished on or after October 1, 2003,

20 in the case of a resident who is not in a stay covered under

21 such part’’ before the comma.

22 (c) MORATORIUM IN REQUIREMENT FOR SNF BILL23 ING OF PART B SERVICES.—Section 1862(a)(18) (42

24 U.S.C. 1395y(a)(18)) is amended to read as follows:
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1 ‘‘(18) which are covered skilled nursing facility

2 services described in section 1888(e)(2)(A)(i) and

3 which are furnished to an individual who is a

4 resident—

5 ‘‘(A) of a skilled nursing facility in the

6 case of a resident who is in a stay covered

7 under part A; or

8 ‘‘(B) of a skilled nursing facility or of a

9 part of a facility that includes a skilled nursing

10 facility (as determined under regulations) for

11 services furnished on or after October 1, 2003,

12 in the case of a resident who is not in a stay

13 covered under such part,

14 by an entity other than the skilled nursing facility,

15 unless the services are furnished under arrange16 ments (as defined in section 1861(w)(1)) with the

17 entity made by the skilled nursing facility;’’.

18 (d) EFFECTIVE DATE.—The amendments made by

19 subsections (a), (b) and (c) are effective as if included in

20 the enactment of BBA.

21 (e) REPORT.—Not later than October 1, 2002, the

22 Comptroller General of the United States shall submit to

23 Congress a report that includes an analysis and rec24 ommendations on—
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1 (1) alternatives, if any, to consolidated billing

2 for part B items and services described in section

3 1842(b)(6) of the Social Security Act (42 U.S.C.

4 1395u(b)(6)) to ensure accountability by skilled

5 nursing facilities and accuracy in claims submitted

6 for all services and items provided to skilled nursing

7 facility residents under part B of the medicare pro8 gram;

9 (2) the costs expected to be incurred by skilled

10 nursing facilities under such alternative approaches,

11 compared with the costs associated with the imple12 mentation of consolidated billing; and

13 (3) the costs incurred by the medicare program

14 in implementing such alternative approaches and

15 their effect on utilization review, compared with the

16 costs and effect on utilization review expected with

17 consolidated billing.

18 SEC. 222. AMBULATORY SURGICAL CENTERS.

19 (a) DELAY IN IMPLEMENTATION OF PROSPECTIVE

20 PAYMENT SYSTEM.—The Secretary of Health and Human

21 Services may not implement a revised prospective payment

22 system for services of ambulatory surgical facilities under

23 section 1833(i) of the Social Security Act (42 U.S.C.

24 1395l(i)) before January 1, 2002.
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1 (b) EXTENDING PHASE-IN TO 4 YEARS.—Section

2 226 of the BBRA is amended by striking paragraphs (1)

3 and (2) and inserting the following:

4 ‘‘(1) in the first year of its implementation,

5 only a proportion (specified by the Secretary and not

to exceed 1 6 ⁄4) of the payment for such services shall

7 be made in accordance with such system and the re8 mainder shall be made in accordance with current

9 regulations; and

10 ‘‘(2) in each of the following 2 years a propor11 tion (specified by the Secretary and not to exceed

1⁄2, and 3 12 ⁄4, respectively) of the payment for such

13 services shall be made under such system and the

14 remainder shall be made in accordance with current

15 regulations.’’.

16 (c) DEADLINE FOR USE OF 1999 OR LATER COST

17 SURVEYS.—Section 226(c) of BBRA is amended by add18 ing at the end the following:

19 ‘‘By not later than January 1, 2003, the Secretary shall

20 incorporate data from a 1999 Medicare cost survey or a

21 subsequent cost survey for purposes of implementing or

22 revising such system.’’.
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1 SEC. 223. 1-YEAR EXTENSION OF MORATORIUM ON THER2 APY CAPS.

3 (a) IN GENERAL.—Section 1833(g)(4) (42 U.S.C.

4 1395l(g)), as added by section 221(a) of BBRA, is amend5 ed by striking ‘‘and 2001’’ and inserting ‘‘, 2001, and

6 2002’’.

7 (b) CONFORMING AMENDMENT TO CONTINUE FO8 CUSED MEDICAL REVIEWS OF CLAIMS DURING MORATO9 RIUM PERIOD.—Section 221(a)(2) of BBRA is amended

10 by striking ‘‘(under the amendment made by paragraph

11 (1)(B))’’.

12 SEC. 224. REVISION OF MEDICARE REIMBURSEMENT FOR

13 TELEHEALTH SERVICES.

14 Section 4206 of the Balanced Budget Act of 1997

15 (42 U.S.C. 1395l note) is amended to read as follows:

16 ‘‘(a) TELEHEALTH SERVICES REIMBURSED.—

17 ‘‘(1) IN GENERAL.—Not later than April 1,

18 2001, the Secretary of Health and Human Services

19 shall make payments from the Federal Supple20 mentary Medical Insurance Trust Fund in accord21 ance with the methodology described in subsection

22 (b) for services for which payment may be made

23 under part B of title XVIII of the Social Security

24 Act (42 U.S.C. 1395j et seq.) that are furnished via

25 a telecommunications system by a physician or prac26 titioner to an eligible telehealth beneficiary.
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1 ‘‘(2) USE OF STORE-AND-FORWARD TECH2 NOLOGIES.—For purposes of paragraph (1), in the

3 case of any Federal telemedicine demonstration pro4 gram in Alaska or Hawaii, the term ‘telecommuni5 cations system’ includes store-and-forward tech6 nologies that provide for the asynchronous trans7 mission of health care information in single or multi8 media formats.

9 ‘‘(b) METHODOLOGY FOR DETERMINING AMOUNT OF

10 PAYMENTS.—

11 ‘‘(1) IN GENERAL.—The Secretary shall make

12 payment under this section as follows:

13 ‘‘(A) Subject to subparagraph (B), with re14 spect to a physician or practitioner located at a

15 distant site that furnishes a service to an eligi16 ble medicare beneficiary under subsection (a),

17 an amount equal to the amount that such phy18 sician or practitioner would have been paid had

19 the service been furnished without the use of a

20 telecommunications system.

21 ‘‘(B) With respect to an originating site, a

22 facility fee equal to—

23 ‘‘(i) for 2001 (beginning with April 1,

24 2001) and 2002, $20; and
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1 ‘‘(ii) for a subsequent year, the facil2 ity fee under this subsection for the pre3 vious year increased by the percentage in4 crease in the MEI (as defined in section

5 1842(i)(3)) for such subsequent year.

6 ‘‘(2) APPLICATION OF PART B COINSURANCE

7 AND DEDUCTIBLE.—Any payment made under this

8 section shall be subject to the coinsurance and de9 ductible requirements under subsections (a)(1) and

10 (b) of section 1833 of the Social Security Act (42

11 U.S.C. 1395l).

12 ‘‘(3) APPLICATION OF NONPARTICIPATING PHY13 SICIAN PAYMENT DIFFERENTIAL AND BALANCE

14 BILLING LIMITS.—The payment differential of sec15 tion 1848(a)(3) of such Act (42 U.S.C. 1395w–

16 4(a)(3)) shall apply to services furnished by non-par17 ticipating physicians. The provisions of section

18 1848(g) of such Act (42 U.S.C. 1395w–4(g)) and

19 section 1842(b)(18) of such Act (42 U.S.C.

20 1395u(b)(18)) shall apply. Payment for such service

21 shall be increased annually by the update factor for

22 physicians’ services determined under section

23 1848(d) of such Act (42 U.S.C. 1395w–4(d)).

24 ‘‘(c) TELEPRESENTER NOT REQUIRED.—Nothing in

25 this section shall be construed as requiring an eligible tele-
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1 health beneficiary to be presented by a physician or practi2 tioner at the originating site for the furnishing of a service

3 via a telecommunications system, unless it is medically

4 necessary as determined by the physician or practitioner

5 at the distant site.

6 ‘‘(d) COVERAGE OF ADDITIONAL SERVICES.—

7 ‘‘(1) STUDY AND REPORT ON ADDITIONAL

8 SERVICES.—

9 ‘‘(A) STUDY.—The Secretary of Health

10 and Human Services shall conduct a study to

11 identify services in addition to those described

12 in subsection (a)(1) that are appropriate for

13 payment under this section.

14 ‘‘(B) REPORT.—Not later than 2 years

15 after the date of enactment of this Act, the Sec16 retary shall submit to Congress a report on the

17 study conducted under subparagraph (A) to18 gether with such recommendations for legisla19 tion that the Secretary determines are appro20 priate.

21 ‘‘(2) IN GENERAL.—The Secretary shall provide

22 for payment under this section for services identified

23 in paragraph (1).

24 ‘‘(e) CONSTRUCTION RELATING TO HOME HEALTH

25 SERVICES.—
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1 ‘‘(1) IN GENERAL.—Nothing in this section or

2 in section 1895 of the Social Security Act (42

3 U.S.C. 1395fff) shall be construed as preventing a

4 home health agency furnishing a home health unit of

5 service for which payment is made under the pro6 spective payment system established in such section

7 for such units of service from furnishing the service.

8 ‘‘(2) LIMITATION.—The Secretary shall not

9 consider a home health service provided in the man10 ner described in paragraph (1) to be a home health

11 visit for purposes of—

12 ‘‘(A) determining the amount of payment

13 to be made under such prospective payment

14 system; or

15 ‘‘(B) any requirement relating to the cer16 tification of a physician required under section

17 1814(a)(2)(C) of such Act (42 U.S.C.

18 1395f(a)(2)(C)).

19 ‘‘(f) COVERAGE OF ITEMS AND SERVICES.—

20 ‘‘(1) IN GENERAL.—Subject to paragraph (2),

21 payment for items and services provided pursuant to

22 subsection (a) shall include payment for professional

23 consultations, office visits, office psychiatry services,

24 including any service identified as of July 1, 2000,

25 by HCPCS codes 99241–99275, 99201–99215,
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1 90804–90809, and 90862, and any additional item

2 or service specified by the Secretary.

3 ‘‘(2) YEARLY UPDATE.—The Secretary shall

4 provide a process that provides, on at least an an5 nual basis, for the review and revision of services

6 (and HCPCS codes) to those specified in paragraph

7 (1) for authorized payment under subsection (a).

8 ‘‘(g) DEFINITIONS.—In this section:

9 ‘‘(1) ELIGIBLE TELEHEALTH BENEFICIARY.—

10 The term ‘eligible telehealth beneficiary’ means an

11 individual enrolled under part B of title XVIII of the

12 Social Security Act (42 U.S.C. 1395j et seq.) that

13 receives a service originating—

14 ‘‘(A) in an area that is designated as a

15 health professional shortage area under section

16 332(a)(1)(A) of the Public Health Service Act

17 (42 U.S.C. 254e(a)(1)(A));

18 ‘‘(B) in a county that is not included in a

19 Metropolitan Statistical Area;

20 ‘‘(C) effective January 1, 2002, in an

21 inner-city area that is medically underserved (as

22 defined in section 330(b)(3) of the Public

23 Health Service Act (42 U.S.C. 254b(b)(3))); or
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1 ‘‘(D) in a service which originated in a fa2 cility which participates in a Federal telemedi3 cine demonstration project.

4 ‘‘(2) PHYSICIAN.—The term ‘physician’ has the

5 meaning given that term in section 1861(r) of the

6 Social Security Act (42 U.S.C. 1395x(r))

7 ‘‘(3) PRACTITIONER.—The term ‘practitioner’

8 means a practitioner described in section

9 1842(b)(18)(C) of the Social Security Act (42

10 U.S.C. 1395u(b)(18)(C)).

11 ‘‘(4) DISTANT SITE.—The term ‘distant site’

12 means the site at which the physician or practitioner

13 is located at the time the service is provided via a

14 telecommunications system.

15 ‘‘(5) ORIGINATING SITE.—

16 ‘‘(A) IN GENERAL.—The term ‘originating

17 site’ means any site described in subparagraph

18 (B) at which the eligible telehealth beneficiary

19 is located at the time the service is furnished

20 via a telecommunications system.

21 ‘‘(B) SITES DESCRIBED.—The sites de22 scribed in this subparagraph are as follows:

23 ‘‘(i) On or after April 1, 2001—

24 ‘‘(I) the office of a physician or a

25 practitioner,
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1 ‘‘(II) a critical access hospital (as

2 defined in section 1861(mm)(1) of the

3 Social Security Act (42 U.S.C.

4 1395x(mm)(1))),

5 ‘‘(III) a rural health clinic (as

6 defined in section 1861(aa)(2) of such

7 Act (42 U.S.C. 1395x(aa)(2))), and

8 ‘‘(IV) a Federally qualified health

9 center (as defined in section

10 1861(aa)(4) of such Act (42 U.S.C.

11 1395x(aa)(4))).

12 ‘‘(ii) On or after January 1, 2002—

13 ‘‘(I) a hospital (as defined in sec14 tion 1861(e) of such Act (42 U.S.C.

15 1395x(e))),

16 ‘‘(II) a skilled nursing facility (as

17 defined in section 1861(j) of such Act

18 (42 U.S.C. 1395x(j))),

19 ‘‘(III) a comprehensive outpatient

20 rehabilitation facility (as defined in

21 section 1861(cc)(2) of such Act (42

22 U.S.C. 1395x(cc)(2))),

23 ‘‘(IV) a renal dialysis facility (de24 scribed in section 1881(b)(1) of such

25 Act (42 U.S.C. 1395rr(b)(1))),
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1 ‘‘(V) an ambulatory surgical cen2 ter (described in section 1833(i)(1)(A)

3 of such Act (42 U.S.C.

4 1395l(i)(1)(A))),

5 ‘‘(VI) a hospital or skilled nurs6 ing facility of the Indian Health Serv7 ice (under section 1880 of such Act

8 (42 U.S.C. 1395qq)), and

9 ‘‘(VII) a community mental

10 health center (as defined in section

11 1861(ff)(3)(B) of such Act (42 U.S.C.

12 1395x(ff)(3)(B))).

13 ‘‘(6) FEDERAL SUPPLEMENTARY MEDICAL IN14 SURANCE TRUST FUND.—The term ‘Federal Supple15 mentary Medical Insurance Trust Fund’ means the

16 trust fund established under section 1841 of the So17 cial Security Act (42 U.S.C. 1395t).’’.

18 SEC. 225. PAYMENT FOR AMBULANCE SERVICES.

19 (a) ELIMINATING BBA REDUCTION.—Section

20 1834(l)(3) (42 U.S.C. 1395m(l)(3)) is amended, in sub21 paragraphs (A) and (B), by striking ‘‘ reduced in the case

22 of 2001 and 2002 by 1.0 percentage points’’ both places

23 it appears.

24 (b) MILEAGE PAYMENTS.—Section 1834(l)(2)(E)

25 (42 U.S.C. 1395m(l)(2)(E)) is amended by inserting be-
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1 fore the period at the end the following: ‘‘, except that

2 such phase-in shall provide for full payment of any na3 tional mileage rate beginning with the effective date of the

4 fee schedule for ambulance services provided by suppliers

5 in any State where payment for such services did not in6 clude a separate amount for all mileage prior to the imple7 mentation of the fee schedule’’.

8 (c) GAO STUDY ON COSTS OF AMBULANCE SERV9 ICES.—

10 (1) STUDY.—The Comptroller General of the

11 United States shall conduct a study of the costs of

12 providing ambulance services covered under the

13 medicare program under title XVIII of the Social

14 Security Act across the range of service levels for

15 which such services are provided.

16 (2) REPORT.—Not later than 18 months after

17 the date of the enactment of this Act, the Comp18 troller General shall submit a report to the Secretary

19 of Health and Human Services and Congress on the

20 study conducted under paragraph (1). Such report

21 shall include recommendations for any changes in

22 methodology or payment levels necessary to fairly

23 compensate suppliers of ambulance services and to

24 ensure the access of medicare beneficiaries to such

25 services under the medicare program.
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1 SEC. 226. CONTRAST ENHANCED DIAGNOSTIC PROCE2 DURES UNDER HOSPITAL PROSPECTIVE PAY3 MENT SYSTEM.

4 (a) SEPARATE CLASSIFICATION.—Section 1833(t)(2)

5 (42 U.S.C. 1395l(t)(2)) is amended—

6 (1) by striking ‘‘and’’ at the end of subpara7 graph (E);

8 (2) by striking the period at the end of sub9 paragraph (F) and inserting ‘‘; and’’; and

10 (3) by inserting after subparagraph (F) the fol11 lowing new subparagraph:

12 ‘‘(G) the Secretary shall create additional

13 groups of covered OPD services that classify

14 separately those procedures that utilize contrast

15 media from those that do not.’’.

16 (b) CONFORMING AMENDMENT.—Section 1861(t)(1)

17 (42 U.S.C. 1395x(t)(1)) is amended by inserting ‘‘(includ18 ing contrast agents)’’ after ‘‘only such drugs’’.

19 (c) EFFECTIVE DATE.—The amendments made by

20 this section shall be effective as if included in the enact21 ment of BBA.

22 SEC. 227. 10-YEAR PHASED IN INCREASE FROM 55 PERCENT

23 TO 80 PERCENT IN THE PROPORTION OF HOS24 PITAL BAD DEBT RECOGNIZED.

25 Section 1861(v)(1)(T) (42 U.S.C. 1395x(v)(1)(T)) is

26 amended—
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1 (1) by striking ‘‘and’’ at the end of clause (ii);

2 (2) in clause (iii) by striking ‘‘a subsequent fis3 cal year’’ and inserting ‘‘fiscal year 2000’’ and by

4 striking the period at the end and inserting a semi5 colon; and

6 (3) by adding at the end the following new

7 clauses:

8 ‘‘(iv) for cost reporting periods beginning dur9 ing fiscal year 2001 and each subsequent fiscal year

10 (before fiscal year 2011), by the percent specified in

11 clause (iii) or this clause for the preceding fiscal

12 year reduced by 2.5 percentage points, of such

13 amount otherwise allowable; and

14 ‘‘(v) for cost reporting periods beginning during

15 fiscal year 2011 or a subsequent fiscal year, by 20

16 percent of such amount otherwise allowable.’’.

17 SEC. 228. STATE ACCREDITATION OF DIABETES SELF-MAN18 AGEMENT TRAINING PROGRAMS.

19 Section 1861(qq)(2) (42 U.S.C. 1395x(qq)(2)) is

20 amended—

21 (1) in the matter preceding subparagraph (A)

22 by striking ‘‘paragraph (1)—’’ and inserting ‘‘para23 graph (1):’’;

24 (2) in subparagraph (A)—
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1 (A) by striking ‘‘a ‘certified provider’ ’’ and

2 inserting ‘‘A ‘certified provider’ ’’; and

3 (B) by striking ‘‘; and’’ and inserting a pe4 riod; and

5 (3) in subparagraph (B)—

6 (A) by striking ‘‘a physician, or such other

7 individual’’ and inserting ‘‘(i) A physician, or

8 such other individual’’;

9 (B) by inserting ‘‘(I)’’ before ‘‘meets appli10 cable standards’’;

11 (C) by inserting ‘‘(II)’’ before ‘‘is recog12 nized’’;

13 (D) by inserting ‘‘, or by a program de14 scribed in clause (ii),’’ after ‘‘recognized by an

15 organization that represents individuals (includ16 ing individuals under this title) with diabetes’’;

17 and

18 (E) by adding at the end the following:

19 ‘‘(ii) Notwithstanding any reference to ‘a na20 tional accreditation body’ in section 1865(b), for

21 purposes of clause (i), a program described in this

22 clause is a program operated by a State for the pur23 poses of accrediting diabetes self-management train24 ing programs, if the Secretary determines that such

25 State program has established quality standards
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1 that meet or exceed the standards established by the

2 Secretary under clause (i) or the standards origi3 nally established by the National Diabetes Advisory

4 Board and subsequently revised as described in

5 clause (i).’’.

6 SEC. 229. UPDATE IN RENAL DIALYSIS COMPOSITE RATE.

7 (a) IN GENERAL.—The last sentence of section

8 1881(b)(7) (42 U.S.C. 1395rr(b)(7)) is amended by strik9 ing ‘‘2001, by 1.2 percent’’ and inserting ‘‘2001, by 2.4

10 percent’’.

11 (b) REPORT ON LITERATURE REVIEW.—The Sec12 retary of Health and Human Services shall conduct a lit13 erature review of studies on the impact of oral self-admin14 istered prescription non-calcium phosphate binding drugs

15 in reducing the incidence of hospitalization under the

16 medicare program for medicare beneficiaries with end

17 stage renal disease. Not later than 6 months after the date

18 of the enactment of this Act, the Secretary shall transmit

19 to the Committees on Commerce and Ways and Means

20 of the House of Representatives and the Committee on

21 Finance of the Senate a summary of the literature review

22 conducted under this subsection.
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1 TITLE III—MEDICARE PART A

2 AND B PROVISIONS

3 SEC. 301. HOME HEALTH SERVICES.

4 (a) 1-YEAR DELAY IN 15 PERCENT REDUCTION IN

5 PAYMENT RATES UNDER THE MEDICARE PROSPECTIVE

6 PAYMENT SYSTEM FOR HOME HEALTH SERVICES.—Sec7 tion 1895(b)(3)(A)(i) (42 U.S.C. 1395fff(b)(3)(A)(i)) is

8 amended—

9 (1) by redesignating subparagraph (II) as sub10 paragraph (III);

11 (2) in subparagraph (III), as redesignated, by

12 striking ‘‘described in subclause (I)’’ and inserting

13 ‘‘described in subclause (II)’’; and

14 (3) by inserting after subclause (I) the fol15 lowing new subclause:

16 ‘‘(II) For the 12-month period

17 beginning after the period described

18 in subclause (I), such amount (or

19 amounts) shall be equal to the amount

20 (or amounts) determined under sub21 clause (I), updated under subpara22 graph (B).’’.

23 (b) TREATMENT OF BRANCH OFFICES.—

24 (1) IN GENERAL.—Notwithstanding any other

25 provision of law, in determining for purposes of title
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1 XVIII of the Social Security Act whether an office

2 of a home health agency constitutes a branch office

3 or a separate home health agency, neither the time

4 nor distance between a parent office of the home

5 health agency and a branch office shall be the sole

6 determinant of a home health agency’s branch office

7 status.

8 (2) CONSIDERATION OF FORMS OF TECH9 NOLOGY IN DEFINITION OF SUPERVISION.—The Sec10 retary of Health and Human Services shall include

11 forms of technology in determining what constitutes

12 ‘‘supervision’’ for purposes of determining a home

13 heath agency’s branch office status under paragraph

14 (1).

15 (c) CLARIFICATION OF THE DEFINITION OF HOME16 BOUND.—

17 (1) IN GENERAL.—The last sentence of sections

18 1814(a) and 1835(a) (42 U.S.C. 1395f(a);

19 1395n(a)) are each amended by striking the period

20 and inserting ‘‘including participating in an adult

21 day care program licensed by a State to furnish

22 adult day care services in the State for the purposes

23 of therapeutic treatment for Alzheimer’s disease or

24 a related dementia, or for medical treatment fur25 nished in an adult day care program.’’.
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1 (2) EFFECTIVE DATE.—The amendments made

2 by paragraph (1) apply to items and services pro3 vided on or after October 1, 2001.

4 (d) 1-YEAR DELAY IN REPORT.—Section 302(c) of

5 the the Medicare, Medicaid, and SCHIP Balanced Budget

6 Refinement Act of 1999 (113 Stat. 1501A–360), as en7 acted into law by section 1000(a)(6) of Public Law 106–

8 113, is amended by striking ‘‘six months’’ and inserting

9 ‘‘18 months’’.

10 SEC. 302. ADVISORY OPINIONS.

11 (a) MAKING PERMANENT EXISTING ADVISORY OPIN12 ION AUTHORITY.—Section 1128D(b)(6) (42 U.S.C.

13 1320a–7d(b)(6)) is amended by striking ‘‘and before the

14 date which is 4 years after such date of enactment’’.

15 (b) NONDISCLOSURE OF REQUESTS AND SUP16 PORTING MATERIALS.—

17 (1) IN GENERAL.—Section 1128D(b) (42

18 U.S.C. 1320a–7d(b)) is amended by adding at the

19 end the following new paragraph:

20 ‘‘(7) NONDISCLOSURE OF REQUESTS AND SUP21 PORTING MATERIALS.—A request for an advisory

22 opinion under this subsection and any supporting

23 written materials submitted by the party requesting

24 the opinion shall not be subject to disclosure under

25 section 552 of title 5, United States Code.’’.
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1 (2) EFFECTIVE DATE.—The amendment made

2 by paragraph (1) applies to requests made before,

3 on, or after the date of the enactment of this Act.

4 SEC. 303. HOSPITAL GEOGRAPHIC RECLASSIFICATION FOR

5 LABOR COSTS FOR OTHER PPS SYSTEMS.

6 (a) HOSPITAL GEOGRAPHIC RECLASSIFICATION FOR

7 LABOR COSTS APPLICABLE TO OTHER PPS SYSTEMS.—

8 (1) IN GENERAL.—Notwithstanding the geo9 graphic adjustment factor otherwise established

10 under title XVIII of the Social Security Act for

11 items and services paid under a prospective payment

12 system described in paragraph (2), in the case of a

13 hospital with an application that has been approved

14 by the Medicare Geographic Classification Review

15 Board under section 1886(d)(10)(C) of such Act (42

16 U.S.C. 1395ww(d)(10)(C)) to change the hospital’s

17 geographic classification for a fiscal year for pur18 poses of the factor used to adjust the prospective

19 payment rate for area differences in hospital wage

20 levels that applies to such hospital under section

21 1886(d)(3)(E) of such Act, the Secretary shall sub22 stitute such change in the hospital’s geographic ad23 justment that would otherwise be applied to an enti24 ty or department of the hospital that is provider

25 based to account for variations in costs which are at-
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1 tributable to wages and wage-related costs for items

2 and services paid under the prospective payment sys3 tems described in paragraph (2).

4 (2) PROSPECTIVE PAYMENT SYSTEMS COV5 ERED.—For purposes of this section, items and serv6 ices furnished under the following prospective pay7 ment systems are covered:

8 (A) SNF PROSPECTIVE PAYMENT SYS9 TEM.—The prospective payment system for cov10 ered skilled nursing facility services under sec11 tion 1888(e) of the Social Security Act (42

12 U.S.C. 1395yy(e)).

13 (B) HOME HEALTH SERVICES PROSPEC14 TIVE PAYMENT SYSTEM.—The prospective pay15 ment system for home health services under

16 section 1895(b) of such Act (42 U.S.C.

17 1395fff(b)).

18 (C) INPATIENT REHABILITATION HOSPITAL

19 SERVICES.—The prospective payment system

20 for inpatient rehabilitation services under sec21 tion 1888(j) of such Act (42 U.S.C.

22 1395ww(j)).

23 (D) INPATIENT LONG-TERM CARE HOS24 PITAL SERVICES.—The prospective payment

25 system for inpatient hospital services of long-
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1 term care hospitals under section 123 of the

2 BBRA.

3 (E) INPATIENT PSYCHIATRIC HOSPITAL

4 SERVICES.—The prospective payment system

5 for inpatient hospital services of psychiatric

6 hospitals and units under section 124 of the

7 BBRA.

8 (b) EFFECTIVE DATE.—Subsection (a) applies to fis9 cal years beginning with fiscal year 2002.

10 SEC. 304. RECLASSIFICATION OF A METROPOLITAN STATIS11 TICAL AREA FOR PURPOSES OF REIMBURSE12 MENT UNDER THE MEDICARE PROGRAM.

13 Notwithstanding any other provision of law, effective

14 for discharges occurring and services furnished during fis15 cal year 2001 and subsequent fiscal years, for purposes

16 of making payments under title XVIII of the Social Secu17 rity Act (42 U.S.C. 1395 et seq.) to hospitals in the Mans18 field, Ohio Metropolitan Statistical Area, such Metropoli19 tan Statistical Area is deemed to be located in the Cleve20 land-Loraine-Elyria, Ohio Metropolitan Statistical Area.

21 The reclassification made under the previous sentence

22 shall be treated as a decision of the Medicare Geographic

23 Classification Review Board under section 1886(d)(10) of

24 such Act (42 U.S.C. 1395ww(d)(10)).
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1 SEC. 305. MAKING THE MEDICARE DEPENDENT, SMALL

2 RURAL HOSPITAL PROGRAM PERMANENT.

3 (a) PAYMENT METHODOLOGY.—Section

4 1886(d)(5)(G) of the Social Security Act (42 U.S.C.

5 1395ww(d)(5)(G)) is amended—

6 (1) in clause (i), by striking ‘‘and before Octo7 ber 1, 2006,’’; and

8 (2) in clause (ii)(II), by striking ‘‘and before

9 October 1, 2006,’’.

10 (b) CONFORMING AMENDMENTS.—

11 (1) TARGET AMOUNT.—Section 1886(b)(3)(D)

12 (42 U.S.C. 1395ww(b)(3)(D)) is amended—

13 (A) in the matter preceding clause (i), by

14 striking ‘‘and before October 1, 2006,’’; and

15 (B) in clause (iv), by striking ‘‘through fis16 cal year 2005,’’ and inserting ‘‘or any subse17 quent fiscal year,’’.

18 (2) PERMITTING HOSPITALS TO DECLINE RE19 CLASSIFICATION.—Section 13501(e)(2) of the Omni20 bus Budget Reconciliation Act of 1993 (42 U.S.C.

21 1395ww note) is amended by striking ‘‘or fiscal year

22 2000 through fiscal year 2005’’ and inserting ‘‘fiscal

23 year 2000, or any subsequent fiscal year,’’.
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1 SEC. 306. OPTION TO BASE ELIGIBILITY ON DISCHARGES

2 DURING ANY OF THE 3 MOST RECENT AU3 DITED COST REPORTING PERIODS.

4 (a) OPTION TO BASE ELIGIBILITY ON DISCHARGES

5 DURING ANY OF THE 3 MOST RECENT AUDITED COST

6 REPORTING PERIODS.—Section 1886(d)(5)(G)(iv)(IV)

7 (42 U.S.C. 1395ww(d)(5)(G)(iv)(IV)) is amended by in8 serting ‘‘, or any of the 3 most recent audited cost report9 ing periods,’’ after ‘‘1987’’.

10 (b) EFFECTIVE DATE.—The amendments made by

11 this section shall apply with respect to cost reporting peri12 ods beginning on or after the date of enactment of this

13 Act.

14 SEC. 307. IDENTIFICATION AND REDUCTION OF MEDICAL

15 ERRORS BY PEER REVIEW ORGANIZATIONS.

16 (a) IN GENERAL.—Section 1154(a) (42 U.S.C.

17 1320c–3(a)) is amended by inserting after paragraph (11)

18 the following new paragraph:

19 ‘‘(12) The organization shall assist providers,

20 practitioners, and Medicare+Choice organizations in

21 identifying and developing strategies to reduce the

22 incidence of actual and potential medical errors and

23 problems related to patient safety affecting individ24 uals entitled to benefits under title XVIII. For the

25 purposes of this part and title XVIII, the functions
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1 described in this paragraph shall be treated as a re2 view function.’’.

3 (b) EFFECTIVE DATE.—The amendments made by

4 this section take effect on January 1, 2001.

5 SEC. 308. GAO REPORT ON IMPACT OF THE EMERGENCY

6 MEDICAL TREATMENT AND ACTIVE LABOR

7 ACT (EMTALA) ON HOSPITAL EMERGENCY DE8 PARTMENTS.

9 (a) CONGRESSIONAL FINDINGS.—The Congress

10 makes the following findings:

11 (1) The Emergency Medical Treatment and Ac12 tive Labor Act (EMTALA) requires that hospitals

13 and the emergency physicians as well as doctors on

14 call at hospital emergency departments screen and

15 stabilize patients who go to emergency departments

16 for treatment.

17 (2) Physicians who refuse to treat emergency

18 department patients or fail to respond to hospital

19 emergency department requests when on call face

20 significant fines and are exposed to liability under

21 EMTALA.

22 (3) The Balanced Budget Act of 1997 made

23 many changes in hospital and physician reimburse24 ment that appear to have had unintended con25 sequences that have hampered the ability of hos-
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1 pitals, emergency physicians, and physicians cov2 ering emergency department call to comply with the

3 requirements of EMTALA.

4 (4) Estimates indicate that EMTALA costs

5 emergency department physicians $426,000,000 per

6 year and leads to at least $10,000,000,000 more in

7 uncompensated inpatient services.

8 (5) Emergency departments, emergency physi9 cians, and physicians covering emergency depart10 ment call have become the de facto providers of indi11 gent health care in America.

12 (6) 27 percent of the over 4,300,000 people liv13 ing in Arizona are uninsured.

14 (7) Many physicians covering emergency de15 partment call in Phoenix, Arizona, are resigning

16 from the medical staff at hospitals due to burden17 some on-call requirements and uncompensated care.

18 (8) Significant concern exists as to whether

19 downtown Phoenix hospitals can keep their emer20 gency departments open.

21 (9) The cumulative effect of potential hospital

22 closings and staff resignations threatens the quality

23 of health care in Phoenix, Arizona.

24 (b) REPORT.—The Comptroller General of the

25 United States shall submit a report to the Subcommittee
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1 on Health and Environment of the Committee on Com2 merce of the House of Representatives by May 1, 2001,

3 on the effect of the Emergency Medical Treatment and

4 Active Labor Act on hospitals, emergency physicians, and

5 physicians covering emergency department call, focusing

6 on those in Arizona (including Phoenix) and California

7 (including Los Angeles).

8 (c) REPORT REQUIREMENTS.—The report should

9 evaluate—

10 (1) the extent to which hospitals, emergency

11 physicians, and physicians covering emergency de12 partment call provide uncompensated services in re13 lation to the requirements of EMTALA;

14 (2) the extent to which the requirements of

15 EMTALA are having a deleterious effect on the leg16 islation’s original intent;

17 (3) any possible estimates for the total dollar

18 amount EMTALA-related care costs emergency phy19 sicians, physicians covering emergency department

20 call, and hospital emergency departments;

21 (4) the extent to which different portions of the

22 country may be experiencing similar uncompensated

23 EMTALA-related care;

24 (5) the extent to which EMTALA would be

25 classified as an unfunded mandate;
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1 (6) the extent to which States have programs to

2 provide financial support for uncompensated care;

3 (7) the extent to which funds under medicare

4 hospital bad debt accounts are available to under5 write the cost of uncompensated EMTALA-related

6 care; and

7 (8) the financial strain that illegal immigration

8 populations place on hospital emergency depart9 ments.

10 (d) DEFINITION.—In this section, the terms ‘‘Emer11 gency Medical Treatment and Active Labor Act’’ and

12 ‘‘EMTALA’’ mean section 1867 of the Social Security Act

13 (42 U.S.C. 1395dd).

14 TITLE IV—MEDICARE+CHOICE

15 PROGRAM STABILIZATION

16 AND IMPROVEMENTS

17 Subtitle A—Payment Reforms

18 SEC. 401. INCREASING MINIMUM PAYMENT AMOUNT.

19 Section 1853(c)(1)(B)(ii) (42 U.S.C. 1395w–

20 23(c)(1)(B)(ii)) is amended—

21 (1) by striking ‘‘(ii) For a succeeding year’’ and

22 inserting ‘‘(ii)(I) Subject to subclause (II), for a suc23 ceeding year’’; and

24 (2) by adding at the end the following new sub25 clause:
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1 ‘‘(II) For 2001 for any area in a Met2 ropolitan Statistical Area with a population

3 of more than 250,000, $525 (and for any

4 other area, $475).’’.

5 SEC. 402. 3 PERCENT MINIMUM PERCENTAGE UPDATE FOR

6 2001.

7 Section 1853(c)(1)(C)(ii) (42 U.S.C. 1395w–

8 23(c)(1)(C)(ii)) is amended by inserting ‘‘(or 103 percent

9 in the case of 2001)’’ after ‘‘102 percent’’.

10 SEC. 403. 10-YEAR PHASE IN OF RISK ADJUSTMENT BASED

11 ON DATA FROM ALL SETTINGS.

12 Section 1853(a)(3)(C)(ii) (42 U.S.C. 1395w–

13 23(c)(1)(C)(ii)) is amended—

14 (1) by striking the period at the end of sub15 clause (II) and inserting a semicolon; and

16 (2) by adding after and below subclause (II) the

17 following:

18 ‘‘and, beginning in 2004, insofar as such

19 risk adjustment is based on data from sub20 stantially all settings, the methodology

21 shall be phased in equal increments over a

22 10-year period, beginning with 2004 or (if

23 later) the first year in which such data are

24 used.’’.
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1 SEC. 404. TRANSITION TO REVISED MEDICARE+CHOICE

2 PAYMENT RATES.

3 (a) ANNOUNCEMENT OF REVISED

4 MEDICARE+CHOICE PAYMENT RATES.—Within 2 weeks

5 after the date of the enactment of this Act, the Secretary

6 of Health and Human Services shall determine, and shall

7 announce (in a manner intended to provide notice to inter8 ested parties) Medicare+Choice capitation rates under

9 section 1853 of the Social Security Act (42 U.S.C.

10 1395w–23) for 2001, revised in accordance with the provi11 sions of this Act.

12 (b) REENTRY INTO PROGRAM PERMITTED FOR

13 MEDICARE+CHOICE PROGRAMS IN 2000.—A

14 Medicare+Choice organization that provided notice to the

15 Secretary of Health and Human Services as of July 3,

16 2000, that it was terminating its contract under part C

17 of title XVIII of the Social Security Act or was reducing

18 the service area of a Medicare+Choice plan offered under

19 such part shall be permitted to continue participation

20 under such part, or to maintain the service area of such

21 plan, for 2001 if it provides the Secretary with the infor22 mation described in section 1854(a)(1) of the Social Secu23 rity Act (42 U.S.C. 1395w–24(a)(1)) within four weeks

24 after the date of the enactment of this Act.

25 (c) REVISED SUBMISSION OF PROPOSED PREMIUMS

26 AND RELATED INFORMATION.—If—
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1 (1) a Medicare+Choice organization provided

2 notice to the Secretary of Health and Human Serv3 ices as of July 3, 2000, that it was renewing its con4 tract under part C of title XVIII of the Social Secu5 rity Act for all or part of the service area or areas

6 served under its current contract, and

7 (2) any part of the service area or areas ad8 dressed in such notice includes a county for which

9 the Medicare+Choice capitation rate under section

10 1853(c) of such Act (42 U.S.C. 1395w–23(c)) for

11 2001, as determined under subsection (a), is higher

12 than the rate previously determined for such year,

13 such organization shall revise its submission of the infor14 mation described in section 1854(a)(1) of the Social Secu15 rity Act (42 U.S.C. 1395w–24(a)(1)), and shall submit

16 such revised information to the Secretary, within four

17 weeks after the date of the enactment of this Act.

18 Subtitle B—Administrative

19 Reforms

20 SEC. 411. EFFECTIVENESS OF ELECTIONS AND CHANGES

21 OF ELECTIONS.

22 (a) IN GENERAL.—Section 1851(f)(2) (42 U.S.C.

23 1395w–21(f)(2)) is amended by striking ‘‘made,’’ and all

24 that follows and inserting ‘‘made.’’.
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1 (b) EFFECTIVE DATE.—The amendment made by

2 subsection (a) applies with respect to years beginning on

3 or after January 1, 2001.

4 SEC. 412. MEDICARE+CHOICE PROGRAM COMPATIBILITY

5 WITH EMPLOYER OR UNION GROUP HEALTH

6 PLANS.

7 (a) IN GENERAL.—Section 1857 (42 U.S.C. 1395w–

8 27) is amended by adding at the end the following new

9 subsection:

10 ‘‘(i) M+C PROGRAM COMPATIBILITY WITH EM11 PLOYER OR UNION GROUP HEALTH PLANS.—To facilitate

12 the offering of Medicare+Choice plans under contracts be13 tween Medicare+Choice organizations and employers,

14 labor organizations, or the trustees of a fund established

15 by 1 or more employers or labor organizations (or com16 bination thereof) to furnish benefits to the entity’s employ17 ees, former employees (or combination thereof) or mem18 bers or former members (or combination thereof) of the

19 labor organizations, the Secretary may waive or modify

20 requirements that hinder the design of, the offering of,

21 or the enrollment in such Medicare+Choice plans.’’.

22 (b) EFFECTIVE DATE.—The amendment made by

23 subsection (a) applies with respect to years beginning with

24 2001.
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1 SEC. 413. UNIFORM PREMIUM AND BENEFITS.

2 (a) IN GENERAL.—Subsections (c) and (f)(1)(D) of

3 section 1854 (42 U.S.C. 1395w–24) are each amended by

4 inserting before the period at the end the following: ‘‘, ex5 cept across counties as approved by the Secretary’’.

6 (b) EFFECTIVE DATE.—The amendments made by

7 subsection (a) apply with respect to years beginning on

8 or after January 1, 2001.

9 TITLE V—MEDICAID

10 SEC. 501. DSH PAYMENTS.

11 (a) CONTINUATION OF MEDICAID DSH ALLOTMENTS

12 AT FISCAL YEAR 2000 LEVELS FOR FISCAL YEARS 2001

13 AND 2002.—Section 1923(f) (42 U.S.C. 1396r–4(f)), as

14 amended by section 601 of the Medicare, Medicaid, and

15 SCHIP Balanced Budget Refinement Act of 1999 (as en16 acted into law by section 1000(a)(6) of Public Law 106–

17 113), is amended—

18 (1) in paragraph (2)—

19 (A) in the matter preceding the table, by

20 striking ‘‘2002’’ and inserting ‘‘2000’’;

21 (B) in the table in such paragraph, by

22 striking the columns labeled ‘‘FY 01’’ and ‘‘FY

23 02’’ relating to fiscal years 2001 and 2002; and

24 (2) in paragraph (3)—

25 (A) by striking ‘‘2003’’ in the heading and

26 inserting ‘‘2001’’; and
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1 (B) by striking ‘‘2003’’ and inserting

2 ‘‘2001’’.

3 (b) HIGHER RATE OF INCREASE IN MEDICAID DSH

4 ALLOTMENT FOR EXTREMELY LOW DSH STATES.—Sec5 tion 1923(f)(3) (42 U.S.C. 1396r–4(f)(3)) is amended—

6 (1) in subparagraph (A), by striking ‘‘subpara7 graph (B)’’ and inserting ‘‘subparagraphs (B) and

8 (C)’’; and

9 (2) by adding at the end the following new sub10 paragraph:

11 ‘‘(C) HIGHER UPDATE RATE FOR EX12 TREMELY LOW DSH STATES.—In the case of a

13 State in which the total expenditures under the

14 State plan (including Federal and State shares)

15 for disproportionate share hospital adjustments

16 under this section for fiscal year 1999, as re17 ported to the Administrator of the Health Care

18 Financing Administration as of August 31,

19 2000, is less than 1 percent of the State’s total

20 amount of expenditures under the State plan

21 for medical assistance during the fiscal year,

22 the DSH allotment for fiscal year 2001 shall be

23 increased to 1 percent of the State’s total

24 amount of expenditures under such plan for

25 such assistance during such fiscal year.’’.
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1 (c) DISTRICT OF COLUMBIA.—Effective beginning

2 with fiscal year 2001, the item in the table in section

3 1923(f) (42 U.S.C. 1396r–4(f)) relating to District of Co4 lumbia for FY 2000, is amended by striking ‘‘32’’ and

5 inserting ‘‘49’’.

6 (d) CONTINGENT ALLOTMENT FOR TENNESSEE.—

7 Section 1923(f) (42 U.S.C. 1396r–4(f)) is amended—

8 (1) in paragraph (3)(A), by striking ‘‘or this

9 paragraph’’ and inserting ‘‘, this paragraph, or para10 graph (4)’’; and

11 (2) by adding at the end the following new

12 paragraph:

13 ‘‘(4) CONTINGENT ALLOTMENT ADJUSTMENT

14 FOR TENNESSEE.—If the State-wide waiver ap15 proved under section 1115 for the State of Ten16 nessee with respect to requirements under this title

17 as in effect on the date of the enactment of this sub18 section is revoked or terminated, the DSH allotment

19 for Tennessee for fiscal year 2001 is deemed to be

20 equal to $286,442,437.’’.

21 (e) ASSURING IDENTIFICATION OF MEDICAID MAN22 AGED CARE PATIENTS.—

23 (1) IN GENERAL.—Section 1932 (42 U.S.C.

24 1396u–2) is amended by adding at the end the fol25 lowing:
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1 ‘‘(g) IDENTIFICATION OF PATIENTS FOR PURPOSES

2 OF MAKING DSH PAYMENTS.—Each contract with a

3 managed care entity under section 1903(m) or under sec4 tion 1905(t)(3) shall require the entity either—

5 ‘‘(1) to report to the State information nec6 essary to determine the hospital services provided

7 under the contract (and the identity of hospitals pro8 viding such services) for purposes of applying sec9 tions 1886(d)(5)(F) and 1923; or

10 ‘‘(2) to include a sponsorship code in the identi11 fication card issued to individuals covered under this

12 title in order that a hospital may identify a patient

13 as being entitled to benefits under this title.’’.

14 (2) CLARIFICATION OF COUNTING MANAGED

15 CARE MEDICAID PATIENTS.—Section 1923(a)(2)(D)

16 (42 U.S.C. 1396r–4(a)(2)(D)) is amended—

17 (A) in subsection (a)(2)(D), by inserting

18 after ‘‘the proportion of low-income and med19 icaid patients’’ the following: ‘‘(including such

20 patients who receive benefits through a man21 aged care entity)’’;

22 (B) in subsection (b)(2), by inserting after

23 ‘‘a State plan approved under this title in a pe24 riod’’ the following: ‘‘(regardless of whether
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1 they receive benefits on a fee-for-service basis

2 or through a managed care entity)’’; and

3 (C) in subsection (b)(3)(A)(i), by inserting

4 after ‘‘under a State plan under this title’’ the

5 following: ‘‘(regardless of whether the services

6 were furnished on a fee-for-service basis or

7 through a managed care entity)’’.

8 (3) EFFECTIVE DATE.—The amendments made

9 by paragraph (1) apply to payments made for peri10 ods on or after January 1, 2001.

11 SEC. 502. NEW PROSPECTIVE PAYMENT SYSTEM FOR FED12 ERALLY-QUALIFIED HEALTH CENTERS AND

13 RURAL HEALTH CLINICS.

14 (a) IN GENERAL.—Section 1902(a) (42 U.S.C.

15 1396a(a)) is amended—

16 (1) in paragraph (13)—

17 (A) in subparagraph (A), by adding ‘‘and’’

18 at the end;

19 (B) in subparagraph (B), by striking

20 ‘‘and’’ at the end; and

21 (C) by striking subparagraph (C); and

22 (2) by inserting after paragraph (14) the fol23 lowing new paragraph:
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1 ‘‘(15) for payment for services described in

2 clause (B) or (C) of section 1905(a)(2) under the

3 plan in accordance with subsection (aa);’’.

4 (b) NEW PROSPECTIVE PAYMENT SYSTEM.—Section

5 1902 (42 U.S.C. 1396a) is amended by adding at the end

6 the following:

7 ‘‘(aa) PAYMENT FOR SERVICES PROVIDED BY FED8 ERALLY-QUALIFIED HEALTH CENTERS AND RURAL

9 HEALTH CLINICS.—

10 ‘‘(1) IN GENERAL.—Beginning with fiscal year

11 2001 and each succeeding fiscal year, the State plan

12 shall provide for payment for services described in

13 section 1905(a)(2)(C) furnished by a Federally14 qualified health center and services described in sec15 tion 1905(a)(2)(B) furnished by a rural health clinic

16 in accordance with the provisions of this subsection.

17 The payment rate under this subsection shall not

18 vary based upon the site services provided in the

19 case of the same center or clinic entity.

20 ‘‘(2) FISCAL YEAR 2001.—Subject to paragraph

21 (4), for services furnished during fiscal year 2001,

22 the State plan shall provide for payment for such

23 services in an amount (calculated on a per visit

24 basis) that is equal to 100 percent of the average of

25 the costs of the center or clinic of furnishing such
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1 services during fiscal years 1999 and 2000 which

2 are reasonable and related to the cost of furnishing

3 such services, or based on such other tests of reason4 ableness as the Secretary prescribes in regulations

5 under section 1833(a)(3), or, in the case of services

6 to which such regulations do not apply, the same

7 methodology used under section 1833(a)(3), ad8 justed to take into account any increase in the scope

9 of such services furnished by the center or clinic

10 during fiscal year 2001.

11 ‘‘(3) FISCAL YEAR 2002 AND SUCCEEDING FIS12 CAL YEARS.—Subject to paragraph (4), for services

13 furnished during fiscal year 2002 or a succeeding

14 fiscal year, the State plan shall provide for payment

15 for such services in an amount (calculated on a per

16 visit basis) that is equal to the amount calculated for

17 such services under this subsection for the preceding

18 fiscal year—

19 ‘‘(A) increased by the percentage increase

20 in the MEI (as defined in section 1842(i)(3))

21 applicable to primary care services (as defined

22 in section 1842(i)(4)) for that fiscal year; and

23 ‘‘(B) adjusted to take into account any in24 crease in the scope of such services furnished by

25 the center or clinic during that fiscal year.
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1 ‘‘(4) ESTABLISHMENT OF INITIAL YEAR PAY2 MENT AMOUNT FOR NEW CENTERS OR CLINICS.—In

3 any case in which an entity first qualifies as a Fed4 erally-qualified health center or rural health clinic

5 after fiscal year 2000, the State plan shall provide

6 for payment for services described in section

7 1905(a)(2)(C) furnished by the center or services

8 described in section 1905(a)(2)(B) furnished by the

9 clinic in the first fiscal year in which the center or

10 clinic so qualifies in an amount (calculated on a per

11 visit basis) that is equal to 100 percent of the costs

12 of furnishing such services during such fiscal year

13 based on the rates established under this subsection

14 for the fiscal year for other such centers or clinics

15 located in the same or adjacent area with a similar

16 case load or, in the absence of such a center or clin17 ic, in accordance with the regulations and method18 ology referred to in paragraph (2) or based on such

19 other tests of reasonableness as the Secretary may

20 specify. For each fiscal year following the fiscal year

21 in which the entity first qualifies as a Federally22 qualified health center or rural health clinic, the

23 State plan shall provide for the payment amount to

24 be calculated in accordance with paragraph (3).
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1 ‘‘(5) ADMINISTRATION IN THE CASE OF MAN2 AGED CARE.—In the case of services furnished by a

3 Federally-qualified health center or rural health clin4 ic pursuant to a contract between the center or clinic

5 and a managed care entity (as defined in section

6 1932(a)(1)(B)), the State plan shall provide for pay7 ment to the center or clinic (at least quarterly) by

8 the State of a supplemental payment equal to the

9 amount (if any) by which the amount determined

10 under paragraphs (2), (3), and (4) of this subsection

11 exceeds the amount of the payments provided under

12 the contract.

13 ‘‘(6) ALTERNATIVE PAYMENT METHODOLO14 GIES.—Notwithstanding any other provision of this

15 section, the State plan may provide for payment in

16 any fiscal year to a Federally-qualified health center

17 for services described in section 1905(a)(2)(C) or to

18 a rural health clinic for services described in section

19 1905(a)(2)(B) in an amount which is determined

20 under an alternative payment methodology that—

21 ‘‘(A) is agreed to by the State and the cen22 ter or clinic; and

23 ‘‘(B) results in payment to the center or

24 clinic of an amount which is at least equal to
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1 the amount otherwise required to be paid to the

2 center or clinic under this section.’’.

3 (c) CONFORMING AMENDMENTS.—

4 (1) Section 4712 of the Balanced Budget Act

5 of 1997 (Public Law 105–33; 111 Stat. 508) is

6 amended by striking subsection (c).

7 (2) Section 1915(b) (42 U.S.C. 1396n(b)) is

8 amended by striking ‘‘1902(a)(13)(E)’’ and insert9 ing ‘‘1902(a)(15), 1902(aa),’’.

10 (d) GAO STUDY OF FUTURE REBASING.—The

11 Comptroller General of the United States shall provide for

12 a study on the need for, and how to, rebase or refine costs

13 for making payment under the medicaid program for serv14 ices provided by Federally-qualified health centers and

15 rural health centers (as provided under the amendments

16 made by this section). The Comptroller General shall pro17 vide for submittal of a report on such study to the Con18 gress by not later than 4 years after the date of the enact19 ment of this Act.

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

21 this section take effect on October 1, 2000, and apply to

22 services furnished on or after such date.
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1 SEC. 503. OPTIONAL COVERAGE OF LEGAL IMMIGRANTS

2 UNDER THE MEDICAID PROGRAM.

3 (a) IN GENERAL.—Section 1903(v) (42 U.S.C.

4 1396b(v)) is amended—

5 (1) in paragraph (1), by striking ‘‘paragraph

6 (2)’’ and inserting ‘‘paragraphs (2) and (4)’’; and

7 (2) by adding at the end the following new

8 paragraph:

9 ‘‘(4)(A) A State may elect (in a plan amendment

10 under this title) to provide medical assistance under this

11 title, notwithstanding sections 401(a), 402(b), 403, and

12 421 of the Personal Responsibility and Work Opportunity

13 Reconciliation Act of 1996, for aliens who are lawfully re14 siding in the United States (including battered aliens de15 scribed in section 431(c) of such Act) and who are other16 wise eligible for such assistance, within either or both of

17 the following eligibility categories, but only if they have

18 lawfully resided in the United States for 2 years:

19 ‘‘(i) PREGNANT WOMEN.—Women during preg20 nancy (and during the 60-day period beginning on

21 the last day of the pregnancy).

22 ‘‘(ii) CHILDREN.—Children (as defined under

23 such plan), including optional targeted low-income

24 children described in section 1905(u)(2)(B).

25 ‘‘(B) In the case of a State that has elected to provide

26 medical assistance to a category of aliens under subpara-
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1 graph (A), no action may be brought under an affidavit

2 of support against any sponsor of such an alien who has

3 lawfully resided in the United State for 2 years on the

4 basis of provision of assistance to such category.’’.

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

6 subsection (a) take effect on October 1, 2000, and apply

7 to medical assistance and child health assistance furnished

8 on or after such date.

9 SEC. 504. ADDITIONAL ENTITIES QUALIFIED TO DETER10 MINE MEDICAID PRESUMPTIVE ELIGIBILITY

11 FOR LOW-INCOME CHILDREN.

12 (a) IN GENERAL.—Section 1920A(b)(3)(A)(i) (42

13 U.S.C. 1396r–1a(b)(3)(A)(i)) is amended—

14 (1) by striking ‘‘or (II)’’ and inserting ‘‘, (II)’’;

15 and

16 (2) by inserting ‘‘eligibility of a child for med17 ical assistance under the State plan under this title,

18 or eligibility of a child for child health assistance

19 under the program funded under title XXI, (III) is

20 an elementary school or secondary school, as such

21 terms are defined in section 14101 of the Elemen22 tary and Secondary Education Act of 1965 (20

23 U.S.C. 8801), an elementary or secondary school op24 erated or supported by the Bureau of Indian Affairs,

25 a State or tribal child support enforcement agency,
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1 a child care resource and referral agency, an organi2 zation that is providing emergency food and shelter

3 under a grant under the Stewart B. McKinney

4 Homeless Assistance Act, or a State or tribal office

5 or entity involved in enrollment in the program

6 under this title, under part A of title IV, under title

7 XXI, or that determines eligibility for any assistance

8 or benefits provided under any program of public or

9 assisted housing that receives Federal funds, includ10 ing the program under section 8 or any other section

11 of the United States Housing Act of 1937 (42

12 U.S.C. 1437 et seq.) or under the Native American

13 Housing Assistance and Self-Determination Act of

14 1996 (25 U.S.C. 4101 et seq.), or (IV) any other en15 tity the State so deems, as approved by the Sec16 retary’’ before the semicolon.

17 (b) TECHNICAL AMENDMENTS.—Section 1920A (42

18 U.S.C. 1396r–1a) is amended—

19 (1) in subsection (b)(3)(A)(ii)—

20 (A) by striking ‘‘paragraph (1)(A)’’ and in21 serting ‘‘paragraph (2)’’, and

22 (B) by striking ‘‘42 U.S.C. 9821’’ and in23 serting ‘‘42 U.S.C. 9831’’; and
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1 (2) in subsection (c)(2), in the matter preceding

2 subparagraph (A), by striking ‘‘subsection

3 (b)(1)(A)’’ and inserting ‘‘subsection (b)(2)’’.

4 (c) APPLICATION TO PRESUMPTIVE ELIGIBILITY FOR

5 PREGNANT WOMEN UNDER MEDICAID.—Section 1920(b)

6 (42 U.S.C. 1396r–1(b)) is amended by adding at the end

7 after and below paragraph (2) the following flush sen8 tence:

9 ‘‘The term ‘qualified provider’ includes a qualified entity

10 as defined in section 1920A(b)(3).’’.

11 (d) APPLICATION UNDER TITLE XXI.—Section

12 2107(e)(1) (42 U.S.C. 1397gg(e)(1)) is amended by add13 ing at the end the following new subparagraph:

14 ‘‘(D) Section 1920A (relating to presump15 tive eligibility).’’.

16 SEC. 505. IMPROVING WELFARE-TO-WORK TRANSITION.

17 (a) 1 YEAR EXTENSION.—Section 1925(f) (42

18 U.S.C. 1396r–6(f)) is amended by striking ‘‘2001’’ and

19 inserting ‘‘2002’’.

20 (b) SIMPLIFICATION OPTIONS.—

21 (1) REMOVAL OF ADMINISTRATIVE REPORTING

22 REQUIREMENTS FOR ADDITIONAL 6-MONTH EXTEN23 SION.—Section 1925(b)(2) of such Act (42 U.S.C.

24 1396r–6(b)(2)) is amended by adding at the end the

25 following new subparagraph:
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1 ‘‘(C) STATE OPTION TO WAIVE REPORTING

2 REQUIREMENTS.—A State may elect to waive

3 the reporting requirements under subparagraph

4 (B) and, in the case of such a waiver for pur5 poses of notices required under subparagraph

6 (A), to exclude from such notices any reference

7 to any requirement under subparagraph (B).’’.

8 (2) EXEMPTION FOR STATES COVERING NEEDY

9 FAMILIES UP TO 185 PERCENT OF POVERTY.—Sec10 tion 1925 (42 U.S.C. 1396r–6) is amended—

11 (A) in each of subsections (a)(1) and

12 (b)(1), by inserting ‘‘but subject to subsection

13 (g),’’ after ‘‘Notwithstanding any other provi14 sion of this title,’’; and

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

16 subsection:

17 ‘‘(g) EXEMPTION FOR STATE COVERING NEEDY

18 FAMILIES UP TO 185 PERCENT OF POVERTY.—

19 ‘‘(1) IN GENERAL.—At State option, the provi20 sions of this section shall not apply to a State that

21 uses the authority under section 1931(b)(2)(C) to

22 make medical assistance available under the State

23 plan under this title, at a minimum, to all individ24 uals described in section 1931(b)(1) in families with

25 gross incomes (determined without regard to work-
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1 related child care expenses of such individuals) at or

2 below 185 percent of the income official poverty line

3 (as defined by the Office of Management and Budg4 et, and revised annually in accordance with section

5 673(2) of the Omnibus Budget Reconciliation Act of

6 1981) applicable to a family of the size involved.

7 ‘‘(2) APPLICATION TO OTHER PROVISIONS OF

8 THIS TITLE.—The State plan of a State described in

9 paragraph (1) shall be deemed to meet the require10 ments of sections 1902(a)(10)(A)(i)(I) and

11 1902(e)(1).’’.

12 (3) EFFECTIVE DATE.—The amendments made

13 by this subsection take effect on October 1, 2000.

14 SEC. 506. MEDICAID COUNTY-ORGANIZED HEALTH SYS15 TEMS.

16 Section 9517(c)(3)(C) of the Comprehensive Omni17 bus Budget Reconciliation Act of 1985 is amended by

18 striking ‘‘10 percent’’ and inserting ‘‘14 percent’’.

19 SEC. 507. MEDICAID RECOGNITION FOR SERVICES OF PHY20 SICIAN ASSISTANTS.

21 (a) IN GENERAL.—Section 1905(a) (42 U.S.C.

22 1396d(a)) is amended—

23 (1) by redesignating paragraphs (22) through

24 (27) as paragraphs (23) through (28), and
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1 (2) by inserting after paragraph (21) the fol2 lowing new paragraph:

3 ‘‘(22) services furnished by an physician assist4 ant (as defined in section 1861(aa)(5)) which the as5 sistant is legally authorized to perform under State

6 law and with the supervision of a physician;’’.

7 (b) CONFORMING AMENDMENTS.—(1) Section

8 1902(a)(10)(C)(iv) (42 U.S.C. 1396a(a)(10)(C)(iv)) is

9 amended by striking ‘‘(24)’’ and inserting ‘‘(25)’’.

10 (2) Section 1929(e)(2)(A) (42 U.S.C.

11 1396t(e)(2)(A)) is amended by striking ‘‘1905(a)(23)’’

12 and inserting ‘‘1905(a)(24)’’.

13 (3) Section 1917(c)(1)(C)(ii) (42 U.S.C.

14 1396p(c)(1)(C)(ii)) is amended by striking ‘‘(22), or (24)’’

15 and inserting ‘‘(23), or (25)’’.

16 TITLE VI—STATE CHILDREN’S

17 HEALTH INSURANCE PROGRAM

18 SEC. 601. SPECIAL RULE FOR AVAILABILITY AND REDIS19 TRIBUTION OF UNUSED FISCAL YEAR 1998

20 AND 1999 SCHIP ALLOTMENTS.

21 (a) CHANGE IN RULES FOR RETENTION AND REDIS22 TRIBUTION OF UNUSED SCHIP ALLOTMENTS FOR FIS23 CAL YEARS 1998 AND 1999.—Section 2104 (42 U.S.C.

24 1397dd) is amended by adding at the end the following

25 new subsection:
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1 ‘‘(g) RULE FOR EXTENDED AVAILABILITY AND RE2 DISTRIBUTION OF FISCAL YEARS 1998 AND 1999 ALLOT3 MENTS.—

4 ‘‘(1) AMOUNT REDISTRIBUTED.—In the case of

5 a State that expends all of its allotment under this

6 section for fiscal year 1998 by the end of fiscal year

7 2000, and for fiscal year 1999 by the end of fiscal

8 year 2001, the Secretary shall redistribute to the

9 State under subsection (f) (from the unexpended

10 portion of fiscal year 1998 or 1999 allotments of

11 other States (as applicable and determined by the

12 application of paragraph (2) with respect to such fis13 cal year)) the following amount:

14 ‘‘(A) STATE.—In the case of one of the 50

15 States or the District of Columbia, the amount

16 of the State’s expenditures in excess of the

17 State’s allotment for fiscal year 1998 or 1999

18 (as applicable).

19 ‘‘(B) TERRITORY.—In the case of a com20 monwealth or territory described in subsection

21 (c)(3), an amount that bears the same ratio to

22 1.05 percent of the total amount described in

23 paragraph (2)(B)(i)(I) as the ratio of its fiscal

24 year 1998 or 1999 allotment under subsection

25 (c) (as applicable) bears to the total of all such
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1 allotments for such fiscal year under such sub2 section.

3 ‘‘(2) EXTENSION OF AVAILABILITY OF PORTION

4 OF FISCAL YEARS 1998 AND 1999 ALLOTMENTS.—

5 ‘‘(A) IN GENERAL.—Notwithstanding sub6 section (e)—

7 ‘‘(i) of the amounts allotted to a State

8 pursuant to this section for fiscal year

9 1998 that were not expended by the State

10 by the end of fiscal year 2000; and

11 ‘‘(ii) of the amounts allotted to a

12 State pursuant to this section for fiscal

13 year 1999 that were not expended by the

14 State by the end of fiscal year 2001,

15 the amount specified in subparagraph (B) with

16 respect to fiscal year 1998 or 1999 (as applica17 ble) for such State shall remain available for

18 expenditure by the State through the end of fis19 cal year 2002.

20 ‘‘(B) AMOUNT REMAINING AVAILABLE FOR

21 EXPENDITURE.—With respect to any State de22 scribed in subparagraph (A), the amount speci23 fied in this subparagraph is equal to—

24 ‘‘(i) the amount by which (I) the total

25 amount available for redistribution under
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1 subsection (f) from the allotments for fis2 cal year 1998 or 1999 (as applicable and

3 determined without regard to this sub4 section), exceeds (II) the total amounts re5 distributed under paragraph (1); multiplied

6 by

7 ‘‘(ii) the ratio of such State’s unex8 pended fiscal year 1998 or 1999 allotment

9 (as applicable) to the total amount de10 scribed in clause (i)(I) for such fiscal year.

11 ‘‘(C) USE OF UP TO 10 PERCENT OF RE12 TAINED 1998 ALLOTMENTS FOR OUTREACH AC13 TIVITIES.—Notwithstanding section

14 2105(c)(2)(A), with respect to any State de15 scribed in subparagraph (A), the State may use

16 up to 10 percent of the amount specified in

17 subparagraph (B) for fiscal year 1998 for ex18 penditures for outreach activities made con19 sistent with section 2102(c)(1).

20 ‘‘(3) DETERMINATION OF AMOUNTS.—For pur21 poses of calculating the amounts described in para22 graphs (1) and (2), the Secretary shall use the

23 amounts reported by the States not later than No24 vember 30 of the appropriate year on HCFA Form
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1 64 or HCFA Form 21, as approved by the Sec2 retary.’’.

3 (b) EFFECTIVE DATE.—The amendments made by

4 this section shall take effect as if included in the enact5 ment of section 4901 of BBA (111 Stat. 552).

6 SEC. 602. OPTIONAL COVERAGE OF CERTAIN LEGAL IMMI7 GRANTS UNDER SCHIP.

8 (a) IN GENERAL.—Section 2107(e)(1) (42 U.S.C.

9 1397gg(e)(1)) is amended by adding at the end the fol10 lowing new subparagraph:

11 ‘‘(D) Section 1903(v)(4) (relating to op12 tional coverage of categories of permanent resi13 dent alien children), but only if the State has

14 elected to apply such section to the category of

15 children under title XIX.’’.

16 (b) EFFECTIVE DATE.—The amendment made by

17 this section takes effect on October 1, 2000, and applies

18 to medical assistance and child health assistance furnished

19 on or after such date.
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1 TITLE VII—EXTENSION OF SPE2 CIAL DIABETES GRANT PRO3 GRAMS

4 SEC. 701. EXTENSION OF JUVENILE AND INDIAN DIABETES

5 GRANT PROGRAMS.

6 (a) JUVENILE DIABETES RESEARCH PROGRAM.—

7 Section 330B of the Public Health Service Act (42 U.S.C.

8 254c–2) is amended by adding at the end the following

9 new subsection:

10 ‘‘(c) EXTENSION OF FUNDING.—There are hereby

11 appropriated, from any amounts in the Treasury not oth12 erwise appropriated, for each of fiscal years 2003 through

13 2007, $50,000,000 for grants under this section, to re14 main available until expended. Nothing in this subsection

15 shall be construed as providing for such amounts to be

16 derived or deducted from appropriations made under sec17 tion 2104(a) of the Social Security Act.’’.

18 (b) INDIAN DIABETES GRANT PROGRAM.——Section

19 330C of the Public Health Service Act (42 U.S.C. 254c–

20 3) is amended by adding at the end the following new sub21 section:

22 ‘‘(d) EXTENSION OF FUNDING.—There are hereby

23 appropriated, from any amounts in the Treasury not oth24 erwise appropriated, for each of fiscal years 2003 through

25 2007, $50,000,000 for grants under this section, to re-
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1 main available until expended. Nothing in this subsection

2 shall be construed as providing for such amounts to be

3 derived or deducted from appropriations made under sec4 tion 2104(a) of the Social Security Act.’’.

5 (c) EXTENSION OF REPORTS ON GRANT PRO6 GRAMS.—Section 4923(b) of BBA is amended—

7 (1) in paragraph (1), by striking ‘‘an interim

8 report’’ and inserting ‘‘interim reports’’;

9 (2) in paragraph (1), by striking ‘‘, 2000’’ and

10 inserting ‘‘in each of 2000, 2002, and 2004’’; and

11 (3) in paragraph (2), by striking ‘‘2002’’ and

12 inserting ‘‘2007’’.

Æ