I

104TH CONGRESS

1ST SESSION H. R. 2476

To amend title XVIII of the Social Security Act to provide for common

sense reforms of the Medicare Program.

IN THE HOUSE OF REPRESENTATIVES

OCTOBER 12, 1995

Mr. STUPAK introduced the following bill; which was referred to the Committee on Ways and Means, and in addition to the Committees on Commerce, and the Judiciary, for a period to be subsequently determined by

the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

A BILL

To amend title XVIII of the Social Security Act to provide

for common sense reforms of the Medicare Program.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Common Sense Medi5 care Reform Act of 1995’’.
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1 TITLE I—FRAUD AND ABUSE

2 Subtitle A—Provisions Relating to

3 Durable Medical Equipment

4 SEC. 101. REVISION OF PAYMENT METHODOLOGY FOR DU5 RABLE MEDICAL EQUIPMENT.

6 (a) IN GENERAL.—Section 1834(a) of the Social Se7 curity Act (42 U.S.C. 1395m(a)) is amended by adding

8 at the end the following new paragraph:

9 ‘‘(19) USING COMPETITIVE PRICING TO DETER10 MINE PAYMENT AMOUNTS.—

11 ‘‘(A) IN GENERAL.—Notwithstanding any

12 other provision of this subsection, the Secretary

13 shall promulgate (on an interim basis pending

14 notice and opportunity for public comment) a

15 fee schedule for payment for covered items

16 under this subsection based on competitive

17 prices and using the inherent reasonableness

18 authority contained in paragraph (10), but

19 without regard to section 1842(b)(9).

20 ‘‘(B) COMPETITIVE BIDDING.—Notwith21 standing any other provision of law, for various

22 areas of the country, the Secretary may employ

23 a competitive rate setting process to establish

24 payment rates for items of durable medical

25 equipment, prosthetics, orthotics, and supplies
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1 under this part. The Secretary may restrict

2 payment for these benefits (i) to that supplier

3 with the lowest bid in such a process, or in

4 those instances where the Secretary concludes it

5 is advantageous to have more than one supplier,

6 (ii) to that set of suppliers whose bids are

7 among the lowest, or (iii) to those suppliers

8 submitting bids who are willing to accept the

9 competitive rate as payment in full.

10 ‘‘(C) LIMITATION ON BILLING.—No sup11 plier of covered items under this subsection may

12 balance bill recipients for more than 15 percent

13 of what is payable to the supplier under this

14 part (determined without regard to deductibles

15 or coinsurance).

16 ‘‘(D) IMPROVED MONITORING OF UTILIZA17 TION OF DURABLE MEDICAL EQUIPMENT.—The

18 Secretary shall take such steps as may be nec19 essary to improve the monitoring of the utiliza20 tion of covered items under this part.’’.

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

22 subsection (a) shall apply, pursuant to regulations of the

23 Secretary, to durable medical equipment furnished on or

24 after the date of the enactment of this Act.
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1 SEC. 102. FREEZE IN UPDATES FOR 1996.

2 (a) COVERED ITEMS.—Section 1834(a)(14) of the

3 Social Security Act (42 U.S.C. 1395m(a)(14)) is amend4 ed—

5 (1) by striking ‘‘and’’ at the end of subpara6 graph (A);

7 (2) in subparagraph (B), by striking ‘‘a subse8 quent year’’ and inserting ‘‘1993, 1994, and 1995’’;

9 and

10 (3) by adding at the end the following:

11 ‘‘(C) for 1996 and each year thereafter, 0

12 percentage points.’’.

13 (b) ORTHOTICS AND PROSTHETICS.—Section

14 1834(h)(4)(A) of such Act (42 U.S.C. 1395m(h)(4)(A))

15 is amended—

16 (1) by adding ‘‘and’’ at the end of clause (ii),

17 and

18 (2) in clause (iii), by striking ‘‘and 1995’’ and

19 inserting ‘‘and each subsequent year’’, and

20 (3) by striking clause (iv).
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1 Subtitle B—Anti-Fraud Provisions

2 SEC. 111. ILLEGAL REMUNERATION WITH RESPECT TO

3 SPECIFIED HEALTH CARE BENEFIT PRO4 GRAMS.

5 (a) IN GENERAL.—Chapter 11 of title 18, United

6 States Code, is amended by adding at the end the follow7 ing:

8 ‘‘§ 227. Illegal remuneration with respect to specified

9 health care benefit programs

10 ‘‘(a) Whoever knowingly and willfully solicits or re11 ceives (or attempts to solicit or receive) any remuneration

12 (including any kickback, bribe, or rebate) directly or indi13 rectly, overtly or covertly, in cash or in kind—

14 ‘‘(1) in return for referring an individual to a

15 person for the furnishing or arranging for the fur16 nishing of any item or service for which payment

17 may be made in whole or in part by any specified

18 health care benefit program, or

19 ‘‘(2) in return for purchasing, leasing, ordering,

20 or arranging for or recommending purchasing, leas21 ing, or ordering any good, facility, service, or item

22 for which payment may be made in whole or in part

23 by any specified health care benefit program,

24 shall be fined under this title or imprisoned for not more

25 than five years, or both.
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1 ‘‘(b) Whoever knowingly and willfully offers or pays

2 (or attempts to offer or pay) any remuneration (including

3 any kickback, bribe, or rebate) directly or indirectly, overt4 ly or covertly, in cash or in kind—

5 ‘‘(1) to refer an individual to a person for the

6 furnishing or arranging for the furnishing of any

7 item or service for which payment may be made in

8 whole or in part by any specified health care benefit

9 program, or

10 ‘‘(2) to purchase, lease, order, or arrange for or

11 recommending purchasing, leasing, or ordering any

12 good, facility, service, or item for which payment

13 may be made in whole or in part by any specified

14 health care benefit program,

15 shall be fined under this title or imprisoned for not more

16 than five years, or both.

17 ‘‘(c)(1) The Attorney General can bring an action in

18 the district courts to impose upon any person who carries

19 out any activity in violation of subsection (a) or (b) a civil

20 penalty of not less than $25,000 and not more than

21 $50,000 for each such violation, and that person shall be

22 subject to damages of three times the total remuneration

23 offered, paid, solicited, or received in violation of such sub24 section.
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1 ‘‘(2) A violation exists under paragraph (1) of one

2 or more purposes of the remuneration is unlawful, and the

3 damages shall be the full amount of such remuneration.

4 ‘‘(3) The procedures for actions under this subsection

5 with regard to subpoenas, statute of limitations, standard

6 of proof, and collateral estoppel shall be governed by sec7 tion 3731 of title 31, United States Code, and the Federal

8 Rules of Civil Procedures shall apply to actions brought

9 under this subsection.

10 ‘‘(4) This subsection shall not affect the availability

11 of other criminal and civil remedies for violations of sub12 sections (a) and (b).

13 ‘‘(d) Subsections (a) through (c) shall not apply to

14 any of the following:

15 ‘‘(1) A discount or other reduction in price ob16 tained by a provider of services or other entity under

17 a specified health care benefit program if the reduc18 tion in price is properly disclosed and appropriately

19 reflected in the costs claimed or charges made by the

20 provider or entity under a specified health care bene21 fit program.

22 ‘‘(2) Any amount paid by an employer to an

23 employee (which has a bona fide employment rela24 tionship with such employer) for employment in the

25 provision of covered items or services if the amount
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1 of the remuneration under the arrangement is con2 sistent with the fair market value of the services and

3 is not determined in a manner that takes into ac4 count (directly or indirectly) the volume or value of

5 any referrals.

6 ‘‘(3) Any amount paid by a vendor of goods or

7 services to a person authorized to act as a purchas8 ing agent for a group of individuals or entities who

9 are furnishing services reimbursed under a specified

10 health care benefit program if—

11 ‘‘(A) the person has a written contract

12 with each such individual or entity, which speci13 fies the amount to be paid the person, which

14 amount may be a fixed amount or a percentage

15 of the value of the purchases made by each

16 such individual or entity under the contract,

17 and

18 ‘‘(B) in the case of an entity that is a pro19 vider of services (as defined in section 1861(u)

20 of the Social Security Act), the person discloses

21 (in such form and manner as the Secretary of

22 Health and Human Services requires) to the

23 entity, and, upon request, to the Secretary of

24 Health and Human Services the amount re-
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1 ceived from each such vendor with respect to

2 chases made by or on behalf of the entity.

3 ‘‘(4) A waiver of any coinsurance under part B

4 of title XVIII of the Social Security Act by a feder5 ally qualified health care center with respect to an

6 individual who qualifies for subsidized services under

7 a provision of the Public Health Service Act.

8 ‘‘(5) Any payment practice specified by the Sec9 retary of Health and Human Services in regulations

10 promulgated pursuant to section 14(a) of the Medi11 care and Medicaid Patient and Program Protection

12 Act of 1987.

13 ‘‘(e) As used in this section, the term ‘specified health

14 care benefit program’ means any plan that provides health

15 benefits, whether directly, through insurance, or other16 wise, which is funded in whole or in part by the United

17 States Government, or is a State health care program (as

18 defined in section 1128(h) of the Social Security Act).’’.

19 (b) CLERICAL AMENDMENT.—The table of sections

20 at the beginning of such chapter is amended by adding

21 at the end the following:

‘‘227. Illegal remuneration with respect to specified health care benefit programs.’’.

22 SEC. 112. GRAND JURY DISCLOSURE.

23 Section 332 of title 18, United States Code, is

24 amended—
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1 (1) by redesignating subsections (c) and (d) as

2 subsections (d) and (e), respectively, and

3 (2) by inserting after subsection (b) the follow4 ing new subsection:

5 ‘‘(c) A person who is privy to grand jury information

6 concerning a Federal health offense (as defined in section

7 982(a)(6)(D)) that is—

8 ‘‘(1) received in the course of duty as an attor9 ney for the Government, or

10 ‘‘(2) disclosed under rule 6(e)(3)(A)(ii) of the

11 Federal Rules of Criminal Procedure,

12 may disclose that information to an attorney for the Gov13 ernment to use in any investigation or civil proceeding re14 lating to health care fraud.’’.

15 SEC. 113. AUTHORIZED INVESTIGATIVE DEMAND PROCE16 DURES.

17 (a) IN GENERAL.—Chapter 233 of title 18, United

18 States Code, is amended by inserting after section 3485

19 the following:

20 ‘‘§ 3486. Authorized investigative demand procedures

21 ‘‘(a) AUTHORIZATION.—

22 ‘‘(1) In any investigation relating to functions

23 set forth in paragraph (2), the Attorney General (or

24 designee of the Attorney General) may issue in writ25 ing and cause to be served a subpoena compelling
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1 production of any records (including any books, pa2 pers, documents, electronic media, or other objects

3 or tangible things) which may be relevant to an au4 thorized law enforcement inquiry that a person or

5 legal entity may possess or have care, custody, or

6 control. A custodian of records may be required to

7 give testimony concerning the production and au8 thentication of such records. The production of

9 records may be required from any place in any State

10 or in any territory or other place subject to the ju11 risdiction of the United States at any designated

12 place; except that such production shall not be re13 quired more than 500 miles distant from the place

14 where the subpoena is served. Witnesses summoned

15 under this paragraph shall be paid the same fees

16 and mileage that are paid witnesses in the courts of

17 the United States. A subpoena requiring the produc18 tion of records shall describe the objects required to

19 be produced and prescribe a return date within a

20 reasonable period of time within which the objects

21 can be assembled and made available.

22 ‘‘(2) Investigative demands utilizing an admin23 istrative subpoena are authorized for any investiga24 tion with respect to any act or activity constituting

25 or involving health care fraud. For purposes of this
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1 paragraph, the term ‘health care fraud’ means a

2 scheme or artifice (A) to defraud any health plan or

3 other person, in connection with the delivery of or

4 payment for health care benefits, items, or services,

5 or (B) to obtain, by means of false or fraudulent

6 pretenses, representations, or promises, any of the

7 money or property owned by, or under the custody

8 or control of, any health plan, or person in connec9 tion with the delivery of or payment for health care

10 benefits, items, or services.

11 ‘‘(b) SERVICES.—A subpoena issued under this sec12 tion may be served by any person designated in the sub13 poena to serve it. Service upon a natural person may be

14 made by personal delivery of the subpoena to the person.

15 Service may be made upon a domestic or foreign associa16 tion which is subject to suit under a common name, by

17 delivering the subpoena to an officer, to a managing or

18 general agent, or to any other agent authorized by ap19 pointment or by law to receive service of process. The affi20 davit of the person serving the subpoena entered on a true

21 copy thereof by the person serving it shall be proof of serv22 ice.

23 ‘‘(c) ENFORCEMENT.—In the case of contumacy by

24 or refusal to obey a subpoena issued to any person, the

25 Attorney General may invoke the aid of any court of the
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1 United States within the jurisdiction of which the inves2 tigation is carried on or of which the subpoenaed person

3 is an inhabitant, or in which he carries on business or may

4 be found, to compel compliance with the subpoena. The

5 court may issue an order requiring the subpoenaed person

6 to appear before the Attorney General to produce records,

7 if so ordered, or to give testimony touching the matter

8 under investigation. Any failure to obey the order of the

9 court may be punished by the court as a contempt thereof.

10 All process in any such case may be served in any judicial

11 district in which such person may be found.

12 ‘‘(d) IMMUNITY FROM CIVIL LIABILITY.—Notwith13 standing any Federal, State, or local law, any person, in14 cluding officers, agents, and employees, receiving a sub15 poena under this section, who complies in good faith with

16 the subpoena and thus produces the materials sought,

17 shall not be liable in any court of any State or the United

18 States to any customer or other person for such produc19 tion or for nondisclosure of that production to the cus20 tomer.

21 ‘‘(e) USE IN ACTION AGAINST INDIVIDUALS.—

22 ‘‘(1) Health information about an individual

23 that is disclosed under this section may not be used

24 in, or disclosed to any person for use in, any admin25 istrative, civil, or criminal action or investigation di-
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1 rected against the individual who is the subject of

2 the information unless the action or investigation

3 arises out of and is directly related to receipt of

4 health care or payment for health care or an action

5 involving a fraudulent claim related to health; or if

6 authorized by an appropriate order of a court of

7 competent jurisdiction, granted after application

8 showing good cause therefor.

9 ‘‘(2) In assessing good cause under paragraph

10 (1), the court shall weigh the public interest and the

11 need for disclosure against the injury to the patient,

12 to the physician-patient relationship, and to the

13 treatment services.

14 ‘‘(3) Upon granting of such order, the court, in

15 determining the extent to which any disclosure of all

16 or any part of any record is necessary, shall impose

17 appropriate safeguards against unauthorized disclo18 sure.’’.

19 (b) CLERICAL AMENDMENT.—The table of sections

20 at the beginning of such chapter is amended by inserting

21 after the item relating to section 3485 the following new

22 item:

‘‘3486. Authorized investigative demand procedures.’’.

23 (c) CONFORMING AMENDMENT.—Section

24 1510(b)(3)(B) of title 18, United States Code, is amended
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1 by inserting ‘‘or a Department of Justice subpoena issued

2 under section 3486 of this title’’ after ‘‘subpoena’’.

3 Subtitle C—Health Care Fraud

4 Abuse Account

5 SEC. 121. FRAUD AND ABUSE CONTROL FUND.

6 (a) IN GENERAL.—Part A of title XI of the Social

7 Security Act is amended by adding at the end the follow8 ing new section:

9 ‘‘FRAUD AND ABUSE CONTROL FUND

10 ‘‘SEC. 1145. (a) The Secretary shall, directly or

11 through contractual or other arrangements and with ap12 propriate coordination with the States, take all steps nec13 essary to assure the accuracy of payments from the trust

14 funds established under title XVIII (referred to herein as

15 the ‘Medicare Trust Funds’) and the appropriation for

16 payments to States to carry out title XIX (referred to

17 herein as the ‘Medicaid appropriation’) and otherwise as18 sure the appropriateness of expenditures from such Funds

19 and such appropriation. To carry out this responsibility,

20 the Secretary shall place particular emphasis on the devel21 opment of and experimentation with innovative or rigorous

22 techniques and approaches to identifying, investigating,

23 and eliminating fraudulent or abusive practices that bur24 den the Medicare Trust Funds or the Medicaid appropria25 tion.
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1 ‘‘(b) To provide a reliable source of funding to sup2 port the Secretary’s activities under subsection (a) and en3 courage cost-effective innovation, there is established in

4 the Treasury of the United States a fund to be known

5 as the ‘HHS Fraud and Abuse Control Fund’ (referred

6 to herein as the ‘Fund’).

7 ‘‘(c) There shall be deposited in the Fund—

8 ‘‘(1) that portion of amounts recovered in rela9 tion to section 1128A arising out of a claim under

10 title XIX or title XVIII as remains after application

11 of subsection (f)(1) (pertaining to reimbursement of

12 a State’s share of recoveries relating to title XIX) or

13 subsection (f)(2) (relating to repayment of the Medi14 care Trust Funds) of that section, as may be appli15 cable,

16 ‘‘(2) payments made pursuant to a court or ad17 ministrative order or voluntary settlement agreement

18 to reimburse for all or part of the costs of investiga19 tions, audits, and monitoring of compliance plans,

20 conducted by the Department of Health and Human

21 Services that relate to the programs under title

22 XVIII or XIX, and

23 ‘‘(3) penalties and damages imposed (other

24 than funds awarded to a relator or for restitution)

25 under sections 3729 through 3732 of title 31, Unit-
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1 ed States Code (pertaining to false claims) in cases

2 involving claims relating to programs under title

3 XVIII or XIX (to the extent the amounts deposited

4 in the Fund under paragraphs (1) and (2) in a fiscal

5 year are less than $2,000,000).

6 ‘‘(d) Amounts deposited in the Fund shall be avail7 able to the Secretary (without the necessity for any provi8 sion therefor in appropriations Acts) until expended for

9 payment of expenses incurred in carrying out subsection

10 (a).

11 ‘‘(e) No more than $2,000,000 may be deposited in

12 the Fund in any fiscal year.’’.

13 (b) INITIAL DEPOSIT IN HHS FRAUD AND ABUSE

14 CONTROL FUND.—There is authorized to be appropriated

15 for fiscal year 1996 an amount (to be deposited in the

16 HHS Fraud and Abuse Control Fund established by sec17 tion 1145(b) of the Social Security Act) for the initial im18 plementation of activities under section 1145(a) of that

19 Act (subject to section 1145(e) of that Act).

20 (c) CONFORMING AMENDMENT.—Section 1128A(f)

21 of the Social Security Act (42 U.S.C. 1320a–7a(f)) is

22 amended—

23 (1) by renumbering paragraph (3) as paragraph

24 (4), and
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1 (2) by inserting after paragraph (2) the follow2 ing:

3 ‘‘(3) Additional amounts (subject to section 1145(e))

4 shall be deposited in the HHS Fraud and Abuse Control

5 Fund established by section 1145(b).’’.

6 (d) EFFECTIVE DATE.—Sections 1145(c) and

7 1128A(f)(3) of the Social Security Act (as enacted and

8 amended by subsections (a) and (c) of this section) apply

9 to amounts recovered, payments made, and penalties and

10 damages imposed, after fiscal year 1995.

11 TITLE II—MEDICARE PLUS

12 PILOT PROGRAM

13 SEC. 201. ESTABLISHMENT OF PILOT PROGRAM.

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

15 Human Services shall establish a pilot program (in this

16 section referred to as the ‘‘pilot program’’) under which

17 additional health plans (including health plans of the type

18 described in subsection (b)) may qualify to be offered

19 under section 1876 of the Social Security Act.

20 (b) TYPES OF ORGANIZATIONS DESCRIBED.—The

21 types of organizations described in this subsection are the

22 following:

23 (1) PROVIDER-SPONSORED NETWORKS.—A

24 health plan offered by a group of affiliated providers

25 that provides a substantial proportion of medicare
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1 covered items and services directly through the affili2 ated group of providers.

3 (2) TAFT-HARTLEY PLANS.—A group health

4 plan that is established or maintained by two or

5 more employers or jointly by one or more employers

6 and one or more employee organizations.

7 (3) ASSOCIATION PLANS.—A health plan of8 fered through an association, religious fraternal or9 ganization, or other organization (which may be a

10 trade, industry, or professional association, a cham11 ber of commerce, or a public entity association)

12 that—

13 (A) has been formed for purposes other

14 than the sale of any health insurance and does

15 not restrict membership based on the health

16 status, claims experience, receipt of health care,

17 medical history, or lack of evidence of insurabil18 ity, of an individual,

19 (B) does not exist solely or principally for

20 the purpose of selling insurance, and

21 (C) has at least 1,000 individual members

22 or 200 employer members.

23 (4) HIGH DEDUCTIBLE HEALTH PLANS WITH

24 CONTRIBUTION TO MEDICAL SAVINGS ACCOUNTS.—
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1 (A) IN GENERAL.—A benefit package con2 sisting of—

3 (i) a high deductible health plan de4 scribed in subparagraph (B), and

5 (ii) a contribution to a medical sav6 ings account (of the excess of the medicare

7 payment amount over the premium for

8 such high deductible health plan).

9 (B) HIGH DEDUCTIBLE HEALTH PLAN DE10 SCRIBED.—A high deductible health plan de11 scribed in this subparagraph is a health plan

12 that—

13 (i) provides reimbursement for at

14 least items and services covered under the

15 medicare program in a year but only after

16 the enrollee incurs countable expenses (as

17 specified under the plan) equal to the

18 amount of a deductible (in an amount that

19 does not exceed $10,000);

20 (ii) counts as such expenses (for pur21 poses of such deductible) at least all

22 amounts that would have been payable

23 under parts A and B of the medicare pro24 gram or by the enrollee if the enrollee had

25 elected to receive benefits through the pro-
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1 visions of such parts (rather than through

2 the plan); and

3 (iii) provides, after such deductible is

4 met for a year and for all subsequent ex5 penses for benefits referred to in clause (i)

6 in the year, for a level of reimbursement

7 that is not less than—

8 (I) 100 percent of such expenses,

9 or

10 (II) 100 percent of the amounts

11 that would have been paid (without

12 regard to any deductibles or coinsur13 ance) under parts A and B of the

14 medicare program with respect to

15 such expenses,

16 whichever is less.

17 (c) PROGRAM DATES.—

18 (1) APPLICATIONS.—Under the pilot program

19 the Secretary shall provide for receipt of applications

20 by October 1, 1996.

21 (2) INITIAL OPERATION.—Operation of the pilot

22 program under approved application shall commence

23 on January 1, 1997.

24 (3) TERMINATION DATE.—
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1 (A) IN GENERAL.—The pilot program

2 under this section shall terminate on December

3 31, 2001, unless extended by the Congress.

4 (B) EARLY TERMINATION.—The Secretary

5 may terminate any project under the pilot pro6 gram on an earlier date if the Secretary deter7 mines that the continued operation of the

8 project will endanger the medicare trust funds.

9 (d) STUDY OF APPLICATION.—In the case of the high

10 deductible health plans with contribution to medical sav11 ings accounts described in subsection (b)(4), the Secretary

12 shall conduct a study of the extent to which enrollees rep13 resent a cross-section by age and income of medicare bene14 ficiaries.

15 (e) STUDY AND REPORT.—The Secretary shall con16 duct a study of the operation of the pilot program and

17 shall submit to Congress, not later than March 1, 2001,

18 on such operation and whether the program should be con19 tinued beyond the termination date specified in subsection

20 (c)(3)(A).
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1 TITLE III—COMMISSION ON THE

2 EFFECT OF THE BABY BOOM

3 GENERATION ON THE MEDI4 CARE PROGRAM

5 SEC. 301. COMMISSION ON THE EFFECT OF THE BABY

6 BOOM GENERATION ON THE MEDICARE PRO7 GRAM.

8 (a) ESTABLISHMENT.—There is established a com9 mission to be known as the Commission on the Effect of

10 the Baby Boom Generation on the Medicare Program (in

11 this section referred to as the ‘‘Commission’’).

12 (b) DUTIES.—

13 (1) IN GENERAL.—The Commission shall—

14 (A) examine the financial impact on the

15 medicare program of the significant increase in

16 the number of medicare eligible individuals

17 which will occur beginning approximately dur18 ing 2010 and lasting for approximately 25

19 years, and

20 (B) make specific recommendations to the

21 Congress respecting a comprehensive approach

22 to preserve the medicare program for the period

23 during which such individuals are eligible for

24 medicare.
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1 (2) CONSIDERATIONS IN MAKING REC2 OMMENDATIONS.—In making its recommendations,

3 the Commission shall consider the following:

4 (A) The amount and sources of Federal

5 funds to finance the medicare program, includ6 ing the potential use of innovative financing

7 methods.

8 (B) The most efficient and effective man9 ner of administering the program.

10 (C) Methods used by other nations to re11 spond to comparable demographic patterns in

12 eligibility for health care benefits for elderly

13 and disabled individuals.

14 (D) Trends in employment-related health

15 care for retirees, including the use of medical

16 savings accounts and similar financing devices.

17 (E) The needs of medicare beneficiaries

18 and providers located in diverse geographic lo19 cations, including urban and rural areas.

20 (3) CONSULTATION WITH MEDICARE TRUST21 EES.—The Commission shall conduct its activities in

22 consultation with the trustees of the Federal Supple23 mentary Medical Insurance Trust Fund.

24 (c) MEMBERSHIP.—
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1 (1) APPOINTMENT.—The Commission shall be

2 composed of 15 members appointed as follows:

3 (A) The President shall appoint 3 mem4 bers.

5 (B) The Majority Leader of the Senate

6 shall appoint, after consultation with the minor7 ity leader of the Senate, 6 members, of whom

8 not more than 4 may be of the same political

9 party.

10 (C) The Speaker of the House of Rep11 resentatives shall appoint, after consultation

12 with the minority leader of the House of Rep13 resentatives, 6 members, of whom not more

14 than 4 may be of the same political party.

15 (2) CHAIRMAN AND VICE CHAIRMAN.—The

16 Commission shall elect a Chairman and Vice Chair17 man from among its members.

18 (3) VACANCIES.—Any vacancy in the member19 ship of the Commission shall be filled in the manner

20 in which the original appointment was made and

21 shall not affect the power of the remaining members

22 to execute the duties of the Commission.

23 (4) QUORUM.—A quorum shall consist of 8

24 members of the Commission, except that 4 members

25 may conduct a hearing under subsection (e).
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1 (5) MEETINGS.—The Commission shall meet at

2 the call of its Chairman or a majority of its mem3 bers. The Commission shall hold hearings in dif4 ferent areas throughout the country in order to ob5 tain information and suggestions from a diverse

6 group of individuals.

7 (6) COMPENSATION AND REIMBURSEMENT OF

8 EXPENSES.—Members of the Commission are not

9 entitled to receive compensation for service on the

10 Commission. Members may be reimbursed for travel,

11 subsistence, and other necessary expenses incurred

12 in carrying out the duties of the Commission.

13 (d) STAFF AND CONSULTANTS.—

14 (1) STAFF.—The Commission may appoint and

15 determine the compensation of such staff as may be

16 necessary to carry out the duties of the Commission.

17 Such appointments and compensation may be made

18 without regard to the provisions of title 5, United

19 States Code, that govern appointments in the com20 petitive services, and the provisions of chapter 51

21 and subchapter III of chapter 53 of such title that

22 relate to classifications and the General Schedule

23 pay rates.

24 (2) CONSULTANTS.—The Commission may pro25 cure such temporary and intermittent services of
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1 consultants under section 3109(b) of title 5, United

2 States Code, as the Commission determines to be

3 necessary to carry out the duties of the Commission.

4 (e) POWERS.—

5 (1) HEARINGS AND OTHER ACTIVITIES.—For

6 the purpose of carrying out its duties, the Commis7 sion may hold such hearings and undertake such

8 other activities as the Commission determines to be

9 necessary to carry out its duties.

10 (2) STUDIES BY GAO.—Upon the request of the

11 Commission, the Comptroller General shall conduct

12 such studies or investigations as the Commission de13 termines to be necessary to carry out its duties.

14 (3) COST ESTIMATES BY CONGRESSIONAL

15 BUDGET OFFICE.—

16 (A) Upon the request of the Commission,

17 the Director of the Congressional Budget Office

18 shall provide to the Commission such cost esti19 mates as the Commission determines to be nec20 essary to carry out its duties.

21 (B) The Commission shall reimburse the

22 Director of the Congressional Budget Office for

23 expenses relating to the employment in the of24 fice of the Director of such additional staff as

25 may be necessary for the Director to comply
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1 with requests by the Commission under sub2 paragraph (A).

3 (4) DETAIL OF FEDERAL EMPLOYEES.—Upon

4 the request of the Commission, the head of any Fed5 eral agency is authorized to detail, without reim6 bursement, any of the personnel of such agency to

7 the Commission to assist the Commission in carry8 ing out its duties. Any such detail shall not interrupt

9 or otherwise affect the civil service status or privi10 leges of the Federal employee.

11 (5) TECHNICAL ASSISTANCE.—Upon the re12 quest of the Commission, the head of a Federal

13 agency shall provide such technical assistance to the

14 Commission as the Commission determines to be

15 necessary to carry out its duties.

16 (6) USE OF MAILS.—The Commission may use

17 the United States mails in the same manner and

18 under the same conditions as Federal agencies and

19 shall, for purposes of the frank, be considered a

20 commission of Congress as described in section 3215

21 of title 39, United States Code.

22 (7) OBTAINING INFORMATION.—The Commis23 sion may secure directly from any Federal agency

24 information necessary to enable it to carry out its

25 duties, if the information may be disclosed under
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1 section 552 of title 5, United States Code. Upon re2 quest of the Chairman of the Commission, the head

3 of such agency shall furnish such information to the

4 Commission.

5 (8) ADMINISTRATIVE SUPPORT SERVICES.—

6 Upon the request of the Commission, the Adminis7 trator of General Services shall provide to the Com8 mission on a reimbursable basis such administrative

9 support services as the Commission may request.

10 (9) ACCEPTANCE OF DONATIONS.—The Com11 mission may accept, use, and dispose of gifts or do12 nations of services or property.

13 (10) PRINTING.—For purposes of costs relating

14 to printing and binding, including the cost of per15 sonnel detailed from the Government Printing Of16 fice, the Commission shall be deemed to be a com17 mittee of the Congress.

18 (f) REPORT.—Not later than January 1, 2001, the

19 Commission shall submit to Congress a report containing

20 its findings and recommendations regarding how to pro21 tect and preserve the medicare program in a financially

22 solvent manner until 2030 (or, if later, throughout the pe23 riod of projected solvency of the Federal Old-Age and Sur24 vivors Insurance Trust Fund). The report shall include de-
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1 tailed recommendations for appropriate legislative initia2 tives respecting how to accomplish this objective.

3 (g) TERMINATION.—The Commission shall terminate

4 60 days after the date of submission of the report required

5 in subsection (f).

6 (h) AUTHORIZATION OF APPROPRIATIONS.—There

7 are authorized to be appropriated $1,500,000 to carry out

8 this section. Amounts appropriated to carry out this sec9 tion shall remain available until expended.

10 TITLE IV—DEVELOPMENT OF

11 SINGLE MEDICARE ADMINIS12 TRATIVE SYSTEM

13 SEC. 401. IMPROVED ADMINISTRATIVE EFFICIENCIES.

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

15 Human Services shall take such steps as may be required

16 to provide for improved efficiency in the medicare program

17 through—

18 (1) establishment of a common payment form

19 (as part of a medicare transaction system) for all

20 medicare payments, and

21 (2) consolidation of the administrative system

22 for parts A and B of the medicare program.

23 (b) REPORT.—The Secretary shall submit to Con24 gress a report on steps taken under subsection (a) and

25 in such legislation as may be required to further carry out
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1 subsection (a) and to provide for further administrative

2 efficiencies under the medicare program.

3 TITLE V—LOCK-BOX PROVISION

4 SEC. 501. LIMITATION ON USE OF SAVINGS.

5 Notwithstanding any other provision of law, all sav6 ings resulting from the enactment of this Act shall be

7 transferred to the credit of the Federal Hospital Insurance

8 Trust Fund and may not be used to offset revenue losses

9 from a tax cut.

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