II 

118TH CONGRESS 

2D SESSION S. 4860 

To amend title XVIII of the Social Security Act to establish coverage for 

certain residential substance use disorder services under the Medicare 

program. 

IN THE SENATE OF THE UNITED STATES 

JULY 30, 2024 

Mr. CASEY introduced the following bill; which was read twice and referred 

to the Committee on Finance 

A BILL 

To amend title XVIII of the Social Security Act to establish 

coverage for certain residential substance use disorder 

services under the Medicare program. 

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

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Residential Recovery 

5 for Seniors Act’’. 


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1 SEC. 2. ESTABLISHING COVERAGE FOR CERTAIN RESIDEN2 TIAL SUBSTANCE USE DISORDER SERVICES 

3 UNDER THE MEDICARE PROGRAM. 

4 (a) COVERAGE UNDER PART A.—Section 1812(a) of 

5 the Social Security Act (42 U.S.C. 1395d(a)) is amend6 ed— 

7 (1) in paragraph (4), by striking ‘‘and’’ at the 

8 end; 

9 (2) in paragraph (5), by striking the period at 

10 the end and inserting a semicolon; and 

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

12 paragraphs: 

13 ‘‘(6) clinically managed low-intensity residential 

14 substance use disorder services (as defined in section 

15 1861(nnn)(1)) furnished to an individual who is a 

16 resident of a clinically managed residential substance 

17 use disorder facility (as defined in section 

18 1861(nnn)(3)) if the individual’s initial need for 

19 such level of services is performed, and continued 

20 need for such level of services is reviewed and re21 affirmed periodically (on a frequency specified by the 

22 Secretary that is not less often than every 30 days), 

23 in accordance with the most current edition ap24 proved by the Secretary of evidence-based substance 

25 use disorder-specific criteria developed by a nonVerDate Sep 11 2014 18:54 Aug 28, 2024 Jkt 049200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S4860.IS S4860

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1 profit medical association generally recognized for its 

2 expertise in addiction treatment; 

3 ‘‘(7) clinically managed high-intensity residen4 tial substance use disorder services (as defined in 

5 section 1861(ooo)(1)) furnished to an individual who 

6 is a resident of a clinically managed residential sub7 stance use disorder facility (as defined in section 

8 1861(nnn)(3)) if the individual’s initial need for 

9 such level of services is performed, and continued 

10 need for such level of services is reviewed and re11 affirmed periodically (on a frequency specified by the 

12 Secretary that is not less often than every 30 days), 

13 in accordance with the most current edition ap14 proved by the Secretary of evidence-based substance 

15 use disorder-specific criteria developed by a non16 profit medical association generally recognized for its 

17 expertise in addiction treatment; and 

18 ‘‘(8) medically managed residential substance 

19 use disorder services (as defined in section 

20 1861(ppp)(1)) furnished to an individual who is a 

21 resident of a medically managed residential sub22 stance use disorder facility (as defined in section 

23 1861(ppp)(3)) if the individual’s initial need for 

24 such level of services is performed, and continued 

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1 affirmed periodically (on a frequency specified by the 

2 Secretary that is not less often than every 10 days), 

3 in accordance with the most current edition ap4 proved by the Secretary of evidence-based substance 

5 use disorder-specific criteria developed by a non6 profit medical association generally recognized for its 

7 expertise in addiction treatment.’’. 

8 (b) RESIDENTIAL SUBSTANCE USE DISORDER SERV9 ICES, PROGRAMS, AND FACILITIES DEFINED.—Section 

10 1861 of the Social Security Act (42 U.S.C. 1395x) is 

11 amended by adding at the end the following new sub12 sections: 

13 ‘‘(nnn) CLINICALLY MANAGED LOW-INTENSITY RES14 IDENTIAL SUBSTANCE USE DISORDER SERVICES, PRO15 GRAM, AND FACILITY.— 

16 ‘‘(1) CLINICALLY MANAGED LOW-INTENSITY

17 RESIDENTIAL SUBSTANCE USE DISORDER SERV18 ICES.—The term ‘clinically managed low-intensity 

19 residential substance use disorder services’ means 

20 the following items and services furnished to an indi21 vidual in a clinically managed low-intensity residen22 tial substance use disorder program (as defined in 

23 paragraph (2)) and (except as provided in subpara24 graph (C)) by such program for the treatment of 


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1 substance use disorders and co-occurring conditions, 

2 including— 

3 ‘‘(A) bed and board; 

4 ‘‘(B) such clinical services and other re5 lated services (including substance use disorder 

6 and co-occurring condition assessments and 

7 treatment planning), such use of clinically man8 aged residential substance use disorder facili9 ties, and such medical social services (including 

10 recovery support services), as are ordinarily fur11 nished by the clinically managed low-intensity 

12 residential substance use disorder program for 

13 the care and treatment of individuals in such 

14 program, and such drugs, supplies, appliances, 

15 and equipment, for use in the clinically man16 aged low-intensity residential substance use dis17 order program, as are ordinarily furnished by 

18 such program for the care and treatment of in19 dividuals in such program; and 

20 ‘‘(C) such other diagnostic or therapeutic 

21 items or services, furnished by the clinically 

22 managed low-intensity residential substance use 

23 disorder program or by others under arrange24 ments with them made by the clinically man25 aged low-intensity residential substance use disVerDate Sep 11 2014 18:54 Aug 28, 2024 Jkt 049200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S4860.IS S4860

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1 order program, as are ordinarily furnished to 

2 individuals either by such clinically managed 

3 low-intensity residential substance use disorder 

4 program or by others under such arrangements, 

5 excluding— 

6 ‘‘(i) medical or surgical services pro7 vided by a physician, services described by 

8 subsection (s)(2)(K), and qualified psychol9 ogist services; and 

10 ‘‘(ii) the services of a private-duty 

11 nurse or other private-duty attendant. 

12 ‘‘(2) CLINICALLY MANAGED LOW-INTENSITY

13 RESIDENTIAL SUBSTANCE USE DISORDER PRO14 GRAM.—The term ‘clinically managed low-intensity 

15 residential substance use disorder program’ means a 

16 residential program which— 

17 ‘‘(A) is primarily engaged in providing 24- 

18 hour structure and support and integrated clin19 ical services for the diagnosis, treatment, and 

20 care of individuals with substance use disorders 

21 who need structure and support to build and 

22 practice their recovery and coping skills; 

23 ‘‘(B) directly provides a substance use dis24 order-specific multidimensional level of care as25 sessment at admission to determine the recVerDate Sep 11 2014 18:54 Aug 28, 2024 Jkt 049200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S4860.IS S4860

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1 ommended level of care, using protocols devel2 oped by a physician or advanced practice pro3 vider with experience in specialty addiction 

4 treatment to confirm the appropriateness of 

5 treatment in such program for individuals who 

6 are intoxicated, experiencing withdrawal, or pre7 senting with biomedical comorbidities; 

8 ‘‘(C) directly provides, or has a direct af9 filiation with, a provider or providers who can 

10 provide physical examinations, prescribe all ad11 diction and psychiatric medications, and provide 

12 medication management and laboratory testing 

13 as needed (except that access to methadone is 

14 not required if no providers of methadone for 

15 opioid use disorder are available, as determined 

16 by the Secretary); 

17 ‘‘(D) directly provides weekly clinical serv18 ices, in hourly increments to be determined by 

19 the Secretary, in an amount, frequency, and in20 tensity appropriate to an individual’s needs as 

21 determined by a substance use disorder-specific 

22 multidimensional assessment, with structured 

23 services available seven days per week; 

24 ‘‘(E) maintains clinical records on all pa25 tients and maintains such records as the SecVerDate Sep 11 2014 18:54 Aug 28, 2024 Jkt 049200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S4860.IS S4860

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1 retary finds to be necessary to determine the 

2 degree and intensity of the treatment provided 

3 to individuals entitled to clinically managed low4 intensity residential substance use disorder pro5 gram insurance benefits under part A, provided 

6 that the Secretary shall not require a program 

7 to maintain such records in a manner that is 

8 more extensive, detailed, or stringent than what 

9 is required of an institution that is considered 

10 a ‘hospital’ under subsection (e); 

11 ‘‘(F) coordinates patient referrals and 

12 transitions to other levels of care when needed, 

13 including transition planning in partnership 

14 with other providers participating in the Medi15 care program; and 

16 ‘‘(G) meets such additional staffing re17 quirements and other conditions as the Sec18 retary shall specify to ensure the effective and 

19 efficient furnishing of such program’s services 

20 and the compliance of such program with clini21 cally managed low-intensity residential sub22 stance use disorder program standards de23 scribed in the most current edition approved by 

24 the Secretary of evidence-based substance use 

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1 profit medical association generally recognized 

2 for its expertise in addiction treatment. 

3 Obtaining and maintaining certification from a certi4 fying body that has the necessary competencies to 

5 assess compliance with such program standards and 

6 is approved by the Secretary shall be deemed to 

7 demonstrate compliance with the standards de8 scribed in subparagraph (G). 

9 ‘‘(3) CLINICALLY MANAGED RESIDENTIAL SUB10 STANCE USE DISORDER FACILITY.—The term ‘clini11 cally managed residential substance use disorder 

12 treatment facility’ means a facility which— 

13 ‘‘(A) is enrolled under section 1866(j); 

14 ‘‘(B) is accredited by an accrediting body 

15 approved by the Secretary; 

16 ‘‘(C) is legally authorized to provide a 

17 clinically managed low- or high-intensity resi18 dential substance use disorder program under 

19 the law of the State (or under a State regu20 latory mechanism provided by State law) in 

21 which the facility is located; and 

22 ‘‘(D) meets such additional conditions as 

23 the Secretary finds necessary in the interest of 

24 the health and safety of individuals who are 

25 residents of such facilities and are furnished 


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1 clinically managed low-intensity residential sub2 stance use disorder services (or clinically man3 aged high-intensity residential substance use 

4 disorder services, as the case may be). 

5 ‘‘(ooo) CLINICALLY MANAGED HIGH-INTENSITY

6 RESIDENTIAL SUBSTANCE USE DISORDER SERVICES AND

7 PROGRAM.— 

8 ‘‘(1) CLINICALLY MANAGED HIGH-INTENSITY

9 RESIDENTIAL SUBSTANCE USE DISORDER SERV10 ICES.—The term ‘clinically managed high-intensity 

11 residential substance use disorder services’ means 

12 the following items and services furnished to an indi13 vidual in a clinically managed high-intensity residen14 tial substance use disorder program (as defined in 

15 paragraph (2)) and (except as provided in subpara16 graph (C)) by such program for the treatment of 

17 substance use disorders and co-occurring conditions, 

18 including— 

19 ‘‘(A) bed and board; 

20 ‘‘(B) such clinical services and other re21 lated services (including substance use disorder 

22 and co-occurring condition assessments and 

23 treatment planning), such use of clinically man24 aged residential substance use disorder facili25 ties, and such medical social services (including 


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1 recovery support services), as are ordinarily fur2 nished by the clinically managed high-intensity 

3 residential substance use disorder program for 

4 the care and treatment of individuals in such 

5 program, and such drugs, supplies, appliances, 

6 and equipment, for use in the clinically man7 aged high-intensity residential substance use 

8 disorder program, as are ordinarily furnished 

9 by such program for the care and treatment of 

10 individuals in such program; and 

11 ‘‘(C) such other diagnostic or therapeutic 

12 items or services, furnished by the clinically 

13 managed high-intensity residential substance 

14 use disorder program or by others under ar15 rangements with them made by the clinically 

16 managed high-intensity residential substance 

17 use disorder program, as are ordinarily fur18 nished to individuals either by such clinically 

19 managed high-intensity residential substance 

20 use disorder program or by others under such 

21 arrangements, excluding— 

22 ‘‘(i) medical or surgical services pro23 vided by a physician, services described by 

24 subsection (s)(2)(K), and qualified psychol25 ogist services; and 


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1 ‘‘(ii) the services of a private-duty 

2 nurse or other private-duty attendant. 

3 ‘‘(2) CLINICALLY MANAGED HIGH-INTENSITY

4 RESIDENTIAL SUBSTANCE USE DISORDER PRO5 GRAM.—The term ‘clinically managed high-intensity 

6 residential substance use disorder program’ means a 

7 residential program that— 

8 ‘‘(A) is primarily engaged in providing 24- 

9 hour supervision for the diagnosis, treatment, 

10 and care of individuals with substance use dis11 orders who need a safe and stable living envi12 ronment to develop sufficient recovery skills so 

13 that they do not immediately relapse or con14 tinue to use in an imminently dangerous man15 ner upon transition to a less intensive level of 

16 care; 

17 ‘‘(B) directly provides a substance use dis18 order-specific multidimensional level of care as19 sessment at admission to determine the rec20 ommended level of care, using protocols devel21 oped by a physician or advanced practice pro22 vider experienced in specialty addiction treat23 ment to confirm the appropriateness of treat24 ment in such facility for individuals who are inVerDate Sep 11 2014 18:54 Aug 28, 2024 Jkt 049200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\S4860.IS S4860

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1 toxicated, experiencing withdrawal, or pre2 senting with biomedical comorbidities; 

3 ‘‘(C) directly provides, or has a direct af4 filiation with, a provider or providers who can 

5 provide physical examinations, prescribe all ad6 diction and psychiatric medications, and provide 

7 medication management and laboratory testing 

8 as needed (except that access to methadone is 

9 not required if no providers of methadone for 

10 opioid use disorder are available, as determined 

11 by the Secretary); 

12 ‘‘(D) directly provides 20 hours or more of 

13 clinical services per week in an amount, fre14 quency, and intensity appropriate to individual 

15 patient needs as determined by a substance use 

16 disorder-specific multidimensional assessment, 

17 with structured services available seven days 

18 per week; 

19 ‘‘(E) directly provides clinically managed 

20 residential withdrawal management, including 

21 24-hour supervision, observation, and support 

22 for individuals who are intoxicated or experi23 encing withdrawal, who do not need medically 

24 monitored or managed care (as determined 

25 through a medical evaluation); 


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1 ‘‘(F) maintains clinical records on all pa2 tients and maintains such records as the Sec3 retary finds to be necessary to determine the 

4 degree and intensity of the treatment provided 

5 to individuals entitled to clinically managed 

6 high-intensity residential substance use disorder 

7 program insurance benefits under part A, pro8 vided that the Secretary shall not require a pro9 gram to maintain such records in a manner 

10 that is more extensive, detailed, or stringent 

11 than what is required of an institution that is 

12 considered a ‘hospital’ under subsection (e); 

13 ‘‘(G) manages patient referrals and transi14 tions to other levels of care when needed; and 

15 ‘‘(H) meets such additional staffing re16 quirements and other conditions as the Sec17 retary shall specify to ensure the effective and 

18 efficient furnishing of such program’s services 

19 and the compliance of such program with clini20 cally managed high-intensity residential sub21 stance use disorder program standards de22 scribed in the most current edition approved by 

23 the Secretary of evidence-based substance use 

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1 profit medical association generally recognized 

2 for its expertise in addiction treatment. 

3 Obtaining and maintaining certification from a certi4 fying body that has the necessary competencies to 

5 assess compliance with such program standards and 

6 is approved by the Secretary shall be deemed to 

7 demonstrate compliance with the standards de8 scribed in subparagraph (H). 

9 ‘‘(ppp) MEDICALLY MANAGED RESIDENTIAL SUB10 STANCE USE DISORDER SERVICES, PROGRAM, AND FA11 CILITY.— 

12 ‘‘(1) MEDICALLY MANAGED RESIDENTIAL SUB13 STANCE USE DISORDER SERVICES.—The term ‘medi14 cally managed residential substance use disorder 

15 services’ means the following items and services fur16 nished to an individual in a medically managed resi17 dential substance use disorder program (as defined 

18 in paragraph (2)) and (except as provided in sub19 paragraph (C)) by such program for the treatment 

20 of substance use disorders and co-occurring condi21 tions, including— 

22 ‘‘(A) bed and board; 

23 ‘‘(B) 24-hour nursing services; 

24 ‘‘(C) such clinical services and other re25 lated services (including substance use disorder 


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1 and co-occurring condition assessments and 

2 treatment planning), such use of medically 

3 managed residential substance use disorder fa4 cilities, and such medical social services (includ5 ing recovery support services), as are ordinarily 

6 furnished by the medically managed residential 

7 substance use disorder program for the care 

8 and treatment of residents of such program, 

9 and such drugs, supplies, appliances, and equip10 ment, for use in the medically managed residen11 tial substance use disorder program, as are or12 dinarily furnished by such program for the care 

13 and treatment of residents of such program; 

14 and 

15 ‘‘(D) such other diagnostic or therapeutic 

16 items or services, furnished by the medically 

17 managed residential substance use disorder pro18 gram or by others under arrangements with 

19 them made by the medically managed residen20 tial substance use disorder program, as are or21 dinarily furnished to residents either by the 

22 medically managed residential substance use 

23 disorder program or by others under such ar24 rangements, excluding— 


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1 ‘‘(i) medical or surgical services pro2 vided by a physician, services described by 

3 subsection (s)(2)(K), and qualified psychol4 ogist services; and 

5 ‘‘(ii) the services of a private-duty 

6 nurse or other private-duty attendant. 

7 ‘‘(2) MEDICALLY MANAGED RESIDENTIAL SUB8 STANCE USE DISORDER PROGRAM.—The term ‘medi9 cally managed residential substance use disorder 

10 program’ means a residential program that— 

11 ‘‘(A) is primarily engaged in providing 

12 management of substance withdrawal and bio13 medical comorbidities, including diagnosis, 

14 treatment, and care, for individuals with sub15 stance use disorders who need 24-hour observa16 tion, monitoring, and treatment, but do not re17 quire the full resources of a hospital; 

18 ‘‘(B) directly provides a comprehensive 

19 nursing assessment at the time of admission, 

20 with a substance use disorder-focused history 

21 obtained as part of the initial assessment which 

22 is reviewed by a physician or advanced practice 

23 provider within 24 hours of admission; 

24 ‘‘(C) directly provides a comprehensive 

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1 vanced practice provider within 24 hours of ad2 mission; 

3 ‘‘(D) directly provides sufficient biopsycho4 social screening and assessments of the pa5 tient’s substance use disorders and co-occurring 

6 disorders to determine the appropriate rec7 ommended level of care and treatment planning; 

8 ‘‘(E) directly provides daily medical inter9 ventions, including nursing and medical moni10 toring for stabilization of acute withdrawal, bio11 medical and psychiatric conditions, and psycho12 social services to encourage engagement in on13 going treatment, all in an amount, frequency, 

14 and intensity appropriate to individual patient 

15 needs as determined by a substance use dis16 order-specific multidimensional assessment; 

17 ‘‘(F) directly provides essential medications 

18 on site with policies and procedures that define 

19 essential medicines based on current standards 

20 of clinical practice and that ensure these medi21 cations are stocked and access to all Food and 

22 Drug Administration-approved medications for 

23 the treatment of substance use disorders (ex24 cept that access to methadone is not required if 

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1 order are available, as determined by the Sec2 retary); 

3 ‘‘(G) directly provides residential intoxica4 tion and withdrawal management services and 

5 residential management of biomedical condi6 tions; 

7 ‘‘(H) maintains clinical records on all pa8 tients and maintains such records as the Sec9 retary finds to be necessary to determine the 

10 degree and intensity of the treatment provided 

11 to individuals entitled to clinically managed 

12 high-intensity residential substance use disorder 

13 program insurance benefits under part A, pro14 vided that the Secretary shall not require a pro15 gram to maintain such records in a manner 

16 that is more extensive, detailed, or stringent 

17 than what is required of an institution that is 

18 considered a ‘hospital’ under subsection (e); 

19 ‘‘(I) manages patient transitions to other 

20 levels of care when needed; and 

21 ‘‘(J) meets such additional staffing re22 quirements and other conditions as the Sec23 retary shall specify to ensure the effective and 

24 efficient furnishing of such program’s services 

25 and the compliance of such program with cliniVerDate Sep 11 2014 18:54 Aug 28, 2024 Jkt 049200 PO 00000 Frm 00019 Fmt 6652 Sfmt 6201 E:\BILLS\S4860.IS S4860

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1 cally managed high-intensity residential sub2 stance use disorder program standards de3 scribed in the most current edition approved by 

4 the Secretary of evidence-based substance use 

5 disorder-specific criteria developed by a non6 profit medical association generally recognized 

7 for its expertise in addiction treatment. 

8 Obtaining and maintaining certification from a certi9 fying body that has the necessary competencies to 

10 assess compliance with such program standards and 

11 is approved by the Secretary shall be deemed to 

12 demonstrate compliance with the standards de13 scribed in subparagraph (J). 

14 ‘‘(3) MEDICALLY MANAGED RESIDENTIAL SUB15 STANCE USE DISORDER FACILITY.—The term ‘medi16 cally managed residential substance use disorder 

17 treatment facility’ means a facility that— 

18 ‘‘(A) is enrolled under section 1866(j); 

19 ‘‘(B) is accredited by an accrediting body 

20 approved by the Secretary; 

21 ‘‘(C) is legally authorized to provide a 

22 medically managed residential substance use 

23 disorder program under the law of the State (or 

24 under a State regulatory mechanism provided 


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1 by State law) in which the facility is located; 

2 and 

3 ‘‘(D) meets such additional conditions as 

4 the Secretary finds necessary in the interest of 

5 the health and safety of individuals who are 

6 residents of such facilities and are furnished 

7 medically managed residential substance use 

8 disorder services.’’. 

9 (c) INCLUDING RESIDENTIAL SUBSTANCE USE DIS10 ORDER FACILITIES AS MEDICARE PROVIDERS.—Section 

11 1866(e) of the Social Security Act (42 U.S.C. 1395cc(e)) 

12 is amended— 

13 (1) in paragraph (2), by striking at the end 

14 ‘‘and’’; 

15 (2) in paragraph (3), by striking the period at 

16 the end and inserting a semicolon; and 

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

18 paragraphs: 

19 ‘‘(4) clinically managed residential substance 

20 use disorder facilities (as defined in paragraph (3) 

21 of section 1861(nnn)), but only with respect to the 

22 furnishing of clinically managed low-intensity resi23 dential substance use disorder services (as defined in 

24 paragraph (1) of such section) and clinically man25 aged high-intensity residential substance use disVerDate Sep 11 2014 18:54 Aug 28, 2024 Jkt 049200 PO 00000 Frm 00021 Fmt 6652 Sfmt 6201 E:\BILLS\S4860.IS S4860

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1 order services (as defined in paragraph (1) of section 

2 1861(ooo)), as applicable; and 

3 ‘‘(5) medically managed residential substance 

4 use disorder facilities (as defined in paragraph (3) 

5 of section 1861(ppp)), but only with respect to the 

6 furnishing of clinically managed low-intensity resi7 dential substance use disorder services (as defined in 

8 paragraph (1) of section 1861(nnn)), clinically man9 aged high-intensity residential substance use dis10 order services (as defined in paragraph (1) of section 

11 1861(ooo)), and medically managed residential sub12 stance use disorder services (as defined in paragraph 

13 (1) of section 1861(ppp)), as applicable.’’. 

14 (d) PROSPECTIVE PAYMENT SYSTEM FOR RESIDEN15 TIAL SUBSTANCE USE DISORDER SERVICES.—Section 

16 1886 of the Social Security Act (42 U.S.C. 1395ww) is 

17 amended by adding at the end the following new sub18 section: 

19 ‘‘(u) PROSPECTIVE PAYMENT FOR RESIDENTIAL

20 SUBSTANCE USE DISORDER FACILITIES.— 

21 ‘‘(1) DEVELOPMENT OF SYSTEM.—The Sec22 retary shall develop a per diem prospective payment 

23 system for low-intensity clinically managed, high-in24 tensity clinically managed, and medically managed 

25 residential substance use disorder services, as those 


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1 terms are defined, respectively, in sections 

2 1861(nnn)(1), 1861(ooo)(1), and 1861(ppp)(1) (in 

3 this subsection collectively referred to as ‘residential 

4 substance use disorder services’). Such system shall 

5 include appropriate adjustments to reflect the dif6 fering resource-intensity of low-intensity clinically 

7 managed, high-intensity clinically managed, and 

8 medically managed residential substance use dis9 order services, and may include an adequate patient 

10 classification system that reflects differences in pa11 tient resource use and cost. In developing such sys12 tem, the Secretary may require clinically managed 

13 and medically managed residential substance use 

14 disorder facilities, as those terms are defined in sec15 tions 1861(nnn)(3) and section 1861(ppp)(3), re16 spectively (in this subsection collectively referred to 

17 as ‘residential substance use disorder facilities’), to 

18 submit such information to the Secretary, including 

19 cost reports, as the Secretary may require to develop 

20 such system. 

21 ‘‘(2) IMPLEMENTATION.— 

22 ‘‘(A) IN GENERAL.—The Secretary shall 

23 provide, for cost reporting periods beginning on 

24 or after October 1, 2025, for payments for resi25 dential substance use disorder services furVerDate Sep 11 2014 18:54 Aug 28, 2024 Jkt 049200 PO 00000 Frm 00023 Fmt 6652 Sfmt 6201 E:\BILLS\S4860.IS S4860

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1 nished by residential substance use disorder fa2 cilities in accordance with the prospective pay3 ment system established by the Secretary under 

4 this subsection. 

5 ‘‘(B) PAYMENTS.— 

6 ‘‘(i) INITIAL PAYMENTS.—The Sec7 retary shall implement such prospective 

8 payment system in the initial fiscal year so 

9 that the estimated aggregate amount of 

10 prospective payment rates is equal to 100 

11 percent of the estimated amount of reason12 able costs incurred by residential substance 

13 use disorder facilities in furnishing such 

14 services. 

15 ‘‘(ii) PAYMENTS IN SUBSEQUENT

16 YEARS.—Payment rates in years after the 

17 year of implementation of such system 

18 shall be the payment rates in the previous 

19 year, adjusted by an increase factor. Such 

20 factor shall be based on an appropriate 

21 percentage increase in a market basket of 

22 goods and services comprising the services 

23 for which payment is made under this sub24 section.’’. 

Æ 


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