II 

112TH CONGRESS 

1ST SESSION S. 1251 

To amend titles XVIII and XIX of the Social Security Act to curb waste, 

fraud, and abuse in the Medicare and Medicaid programs. 

IN THE SENATE OF THE UNITED STATES 

JUNE 22, 2011 

Mr. CARPER (for himself, Mr. COBURN, Mr. BENNET, Mr. ENZI, Mr. CORKER, 

Mr. BROWN of Massachusetts, Ms. KLOBUCHAR, and Mr. THUNE) introduced the following bill; which was read twice and referred to the Committee on Finance 

A BILL 

To amend titles XVIII and XIX of the Social Security Act 

to curb waste, fraud, and abuse in the Medicare and 

Medicaid programs. 

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; TABLE OF CONTENTS. 

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

5 ‘‘Medicare and Medicaid Fighting Fraud and Abuse to 

6 Save Taxpayers’ Dollars Act’’ or the ‘‘Medicare and Med7 icaid FAST Act’’. 

8 (b) TABLE OF CONTENTS.—The table of contents of 

9 this Act is as follows: 


jlentini on DSK4TPTVN1PROD with BILLS
2 

•S 1251 IS

Sec. 1. Short title; table of contents. 

TITLE I—PREVENTING PRESCRIPTION DRUG WASTE, FRAUD, 

AND ABUSE 

Sec. 101. Requiring valid National Provider Identifiers of prescribers on pharmacy claims and limiting access to the National Provider Identifier Registry. 

Sec. 102. Encouraging the establishment of State Prescription Drug Monitoring Programs. 

Sec. 103. Updating of DEA database of controlled substances providers. 

TITLE II—CURBING IMPROPER PAYMENTS 

Sec. 201. Addressing vulnerabilities identified by Recovery Audit Contractors. 

Sec. 202. Improving Senior Medicare Patrol and fraud reporting rewards. 

Sec. 203. Prohibiting the display of Social Security account numbers on newly 

issued Medicare identification cards and communications provided to Medicare beneficiaries. 

Sec. 204. Requiring prepayment review of all claims for durable medical equipment at high risk of waste, fraud, and abuse. 

Sec. 205. Strengthening Medicaid Program integrity through flexibility. 

TITLE III—IMPROVING DATA SHARING ACROSS AGENCIES AND 

PROGRAMS 

Sec. 301. Improving data sharing across agencies and programs. 

Sec. 302. Expanding automated prepayment review of Medicare claims. 

Sec. 303. Improving the sharing of data between the Federal Government and 

State Medicaid programs. 

Sec. 304. Improving claims processing and detection of fraud within the Medicaid and CHIP programs. 

Sec. 305. Reports. 

TITLE IV—IMPROVING CMS CONTRACTOR PERFORMANCE 

Sec. 401. Establishing Medicare administrative contractor error reduction incentives. 

Sec. 402. Separating provider enrollment and screening from Medicare administrative contractors. 

Sec. 403. Developing measurable performance metrics for Medicare contractors. 

TITLE V—OTHER PROVISIONS 

Sec. 501. Strengthening penalties for the illegal distribution of a Medicare, 

Medicaid, or CHIP beneficiary identification or billing privileges. 

Sec. 502. Providing implementation funding. 


jlentini on DSK4TPTVN1PROD with BILLS
3 

•S 1251 IS

1 TITLE I—PREVENTING PRE2 SCRIPTION DRUG WASTE, 

3 FRAUD, AND ABUSE 

4 SEC. 101. REQUIRING VALID NATIONAL PROVIDER IDENTI5 FIERS OF PRESCRIBERS ON PHARMACY 

6 CLAIMS AND LIMITING ACCESS TO THE NA7 TIONAL PROVIDER IDENTIFIER REGISTRY. 

8 (a) REQUIRING VALID NATIONAL PROVIDER IDENTI9 FIERS OF PRESCRIBERS ON PHARMACY CLAIMS.—Section 

10 1860D–4(c) of the Social Security Act (42 U.S.C. 1395w– 

11 104(c)) is amended by adding at the end the following new 

12 paragraph: 

13 ‘‘(4) REQUIRING VALID NATIONAL PROVIDER

14 IDENTIFIERS OF PRESCRIBERS ON PHARMACY

15 CLAIMS.— 

16 ‘‘(A) IN GENERAL.—For plan year 2013 

17 and subsequent plan years, subject to subpara18 graph (B), the Secretary shall prohibit PDP 

19 sponsors of prescription drug plans from paying 

20 claims for prescription drugs under this part 

21 that do not include the valid National Provider 

22 Identifier for the drug’s prescriber. 

23 ‘‘(B) PROCEDURES.—The Secretary shall 

24 establish— 


jlentini on DSK4TPTVN1PROD with BILLS
4 

•S 1251 IS

1 ‘‘(i) procedures for determining the 

2 validity of National Provider Identifiers 

3 under subparagraph (A); and 

4 ‘‘(ii) procedures for transferring to 

5 the Inspector General of the Department 

6 of Health and Human Services and appro7 priate law enforcement agencies and other 

8 oversight entities information on those Na9 tional Provider Identifiers and pharmacy 

10 claims, including records related to such 

11 claims, that the Secretary determines are 

12 invalid under clause (i). 

13 ‘‘(C) REPORT.—Not later than January 1, 

14 2014, the Inspector General of the Department 

15 of Health and Human Services shall submit to 

16 Congress a report on the effectiveness of the 

17 procedures established under subparagraph 

18 (B).’’. 

19 (b) LIMITING ACCESS TO NATIONAL PROVIDER

20 IDENTIFIER REGISTRY.— 

21 (1) IN GENERAL.—The Secretary of Health and 

22 Human Services (in this subsection referred to as 

23 the ‘‘Secretary’’), in consultation with the Attorney 

24 General, the Inspector General of the Department of 

25 Health and Human Services, the Chairman of the 


jlentini on DSK4TPTVN1PROD with BILLS
5 

•S 1251 IS

1 Federal Trade Commission, and affected parties (in2 cluding prescription drug plans under part D of title 

3 XVIII of the Social Security Act (42 U.S.C. 1395w– 

4 101 et seq.), MA–PD plans under part C of title 

5 XVIII of the Social Security Act (42 U.S.C. 1395w– 

6 21 et seq.), pharmacies, physicians, and pharmacy 

7 computer vendors), shall establish procedures and 

8 rules to restrict access to the National Provider 

9 Identifier Registry in order to deter its fraudulent 

10 use. 

11 (2) ACCESS.—The procedures established under 

12 paragraph (1) shall provide governmental and non13 governmental entities, as appropriate, access to such 

14 Registry under data use agreements and in accord15 ance with rules established by the Secretary under 

16 such paragraph. 

17 SEC. 102. ENCOURAGING THE ESTABLISHMENT OF STATE 

18 PRESCRIPTION DRUG MONITORING PRO19 GRAMS. 

20 (a) ENCOURAGING THE ESTABLISHMENT OF STATE

21 PRESCRIPTION DRUG MONITORING PROGRAMS.—Title 

22 XIX of the Social Security Act (42 U.S.C. 1396 et seq.) 

23 is amended by adding at the end the following new section: 


jlentini on DSK4TPTVN1PROD with BILLS
6 

•S 1251 IS

1 ‘‘SEC. 1947. ENCOURAGING THE ESTABLISHMENT OF STATE 

2 PRESCRIPTION DRUG MONITORING PRO3 GRAMS. 

4 ‘‘(a) IN GENERAL.—To encourage the establishment 

5 and use of a State Prescription Drug Monitoring Pro6 gram, notwithstanding sections 1905(b) and 1927(g), and 

7 for purposes of paragraphs (2)(B) and (3)(A) of section 

8 1903(d), if a State has established a State Prescription 

9 Drug Monitoring Program that has been certified as meet10 ing the requirements under subsection (b), with respect 

11 to any amounts recovered by or paid to a State subsequent 

12 to the date of such certification that are related to an over13 payment due to fraud, waste, or abuse in connection the 

14 provision of covered services under the State plan, the 

15 Federal medical assistance percentage with respect to such 

16 amounts shall be decreased by 10 percentage points. A 

17 State may use such amounts recovered by or paid to the 

18 State to support the State Prescription Drug Monitoring 

19 Program established by the State. 

20 ‘‘(b) REQUIREMENTS.—For purposes of subsection 

21 (a), the requirements of this subsection are that the Attor22 ney General certifies to the Secretary that the State has 

23 established a State Prescription Drug Monitoring Pro24 gram. In making a certification under the preceding sen25 tence, the Attorney General shall take into consideration 

26 requirements with respect to Prescription Drug MoniVerDate Mar 15 2010 20:26 Jun 29, 2011 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S1251.IS S1251

jlentini on DSK4TPTVN1PROD with BILLS
7 

•S 1251 IS

1 toring Programs under the Harold Rogers Prescription 

2 Drug Monitoring Program administered by the Depart3 ment of Justice or the National All Schedules Prescription 

4 Electronic Reporting program administered by the De5 partment of Health and Human Services. 

6 ‘‘(c) COMMISSION TO EXAMINE INTEROPERABILITY

7 AND OTHER RELATED ISSUES.— 

8 ‘‘(1) ESTABLISHMENT.—The Secretary and the 

9 Attorney General shall jointly establish a Commis10 sion to examine interoperability and other issues re11 lated to State Prescription Drug Monitoring Pro12 grams, including— 

13 ‘‘(A) best practices with respect to uniform 

14 electronic formats for the reporting, sharing, 

15 and disclosure of information under such Pro16 grams; and 

17 ‘‘(B) the ability to interface with such Pro18 grams. 

19 ‘‘(2) MEMBERSHIP.—The Commission shall be 

20 composed of the following members: 

21 ‘‘(A) The Secretary. 

22 ‘‘(B) The Attorney General. 

23 ‘‘(C) The heads of other appropriate agen24 cies (as determined jointly by the Secretary and 

25 the Attorney General). 


jlentini on DSK4TPTVN1PROD with BILLS
8 

•S 1251 IS

1 ‘‘(D) Stakeholders appointed jointly by the 

2 Secretary and the Attorney General. 

3 ‘‘(3) NO COMPENSATION OF MEMBERS.— 

4 ‘‘(A) NON-FEDERAL EMPLOYEES.—A 

5 member of the Commission who is not an offi6 cer or employee of the Federal Government 

7 shall serve without compensation. 

8 ‘‘(B) FEDERAL EMPLOYEES.—A member 

9 of the Commission who is an officer or em10 ployee of the Federal Government shall serve 

11 without compensation in addition to the com12 pensation received for the services of the mem13 ber as an officer or employee of the Federal 

14 Government. 

15 ‘‘(4) DURATION.—The Commission shall termi16 nate on the date that is 3 years after the date of en17 actment of the Medicare and Medicaid Fighting 

18 Fraud and Abuse to Save Taxpayers’ Dollars Act’’. 

19 (b) INCLUSION OF PRESCRIPTION DRUG MONI20 TORING PROGRAMS IN MEDICARE PART D OVERSIGHT.— 

21 Not later than 180 days after the date of enactment of 

22 this Act, the Secretary of Health and Human Services 

23 shall submit to Congress a plan on how Medicare part D 

24 oversight contractors and other oversight activities under 

25 part D of title XVIII of the Social Security Act (42 U.S.C. 


jlentini on DSK4TPTVN1PROD with BILLS
9 

•S 1251 IS

1 1395w–101 et seq.) can utilize State Prescription Drug 

2 Monitoring Programs. 

3 SEC. 103. UPDATING OF DEA DATABASE OF CONTROLLED 

4 SUBSTANCES PROVIDERS. 

5 (a) IN GENERAL.— 

6 (1) UPDATING BASED ON DEATH MASTER

7 FILE.—Not less frequently than on a daily basis, the 

8 Attorney General shall update the database of the 

9 Drug Enforcement Agency of persons registered to 

10 manufacture, distribute, or dispense a controlled 

11 substance under part C of title II of the Controlled 

12 Substances Act (21 U.S.C. 821 et seq.) to reflect 

13 any changes in the information in the Death Master 

14 File of the Social Security Administration. 

15 (2) UPDATING BASED ON OTHER INFORMATION

16 REPORTED TO THE SOCIAL SECURITY ADMINISTRA17 TION.—The Attorney General shall enter into an 

18 agreement with the Commissioner of Social Security 

19 to obtain information regarding deaths reported to 

20 the Commissioner, including death information re21 ported to the Commissioner under section 205(r) of 

22 the Social Security Act (42 U.5.C. 405(r)), in order 

23 to update the database of the Drug Enforcement 

24 Agency of persons registered to manufacture, dis25 tribute, or dispense a controlled substance under 


jlentini on DSK4TPTVN1PROD with BILLS
10 

•S 1251 IS

1 part C of title II of the Controlled Substances Act 

2 (21 U.S.C. 821 et seq.) to reflect any deaths re3 ported to the Commissioner of Social Security. The 

4 Attorney General shall take any actions required by 

5 the agreement with the Commissioner to maintain 

6 the confidentiality of such data and to assure that 

7 the data is used solely for the purposes of this para8 graph. 

9 (b) LIMITING ACCESS TO DEA DATABASE OF REG10 ISTRANTS.— 

11 (1) IN GENERAL.—The Attorney General, in 

12 consultation with the Secretary of Health and 

13 Human Services, the Inspector General of the De14 partment of Health and Human Services, the Chair15 man of the Federal Trade Commission, and affected 

16 parties (including prescription drug plans under part 

17 D of title XVIII of the Social Security Act (42 

18 U.S.C. 1395w–101 et seq.), MA–PD plans under 

19 part C of title XVIII of the Social Security Act (42 

20 U.S.C. 1395w–21 et seq.), pharmacies, physicians, 

21 and pharmacy computer vendors), shall establish 

22 procedures and rules to restrict access to the data23 base of the Drug Enforcement Agency of persons 

24 registered to manufacturer, distribute, or dispense a 

25 controlled substance under part C of title II of the 


jlentini on DSK4TPTVN1PROD with BILLS
11 

•S 1251 IS

1 Controlled Substances Act (21 U.S.C. 821 et seq.) 

2 in order to deter its fraudulent use. 

3 (2) ACCESS.—The procedures established under 

4 paragraph (1) shall provide governmental and non5 governmental entities, as appropriate, access to such 

6 database under data use agreements and in accord7 ance with rules established by the Attorney General 

8 under such paragraph. 

9 (c) REVIEW AND INVESTIGATION OF INVALID DEA 

10 REGISTRATION NUMBERS.—The Attorney General, in 

11 consultation with the Secretary of Health and Human 

12 Services, the Inspector General of the Department of 

13 Health and Human Services, the Chairman of the Federal 

14 Trade Commission, and affected parties (including pre15 scription drug plans under part D of title XVIII of the 

16 Social Security Act (42 U.S.C. 1395w–101 et seq.), MA– 

17 PD plans under part C of title XVIII of the Social Secu18 rity Act (42 U.S.C. 1395w–21 et seq.), pharmacies, physi19 cians, and pharmacy computer vendors), shall establish 

20 procedures and rules to review and investigate pharmacy 

21 claims under such part D that contain a registration num22 ber that was not assigned by the Attorney General under 

23 the Controlled Substances Act (21 U.S.C. 801 et seq.) to 

24 a practitioner (as defined in section 102 of such Act (21 

25 U.S.C. 802)). Such procedures shall include the matching 


jlentini on DSK4TPTVN1PROD with BILLS
12 

•S 1251 IS

1 of National Provider Identifiers submitted under section 

2 1860D–4(c)(4) of the Social Security Act, as added by 

3 section 101(a), to such registration numbers and the in4 vestigation of such registration numbers that are matched 

5 to a National Provider Identifier determined to be invalid 

6 under such section. 

7 (d) SENSE OF CONGRESS.—It is the sense of Con8 gress that the Attorney General should include in the up9 dates required under subsection (a) any other information 

10 determined relevant by the Attorney General, such as in11 formation from State Medical Boards. 

12 TITLE II—CURBING IMPROPER 

13 PAYMENTS 

14 SEC. 201. ADDRESSING VULNERABILITIES IDENTIFIED BY 

15 RECOVERY AUDIT CONTRACTORS. 

16 Section 1893(h) of the Social Security Act (42 U.S.C. 

17 1395ddd(h)) is amended— 

18 (1) in paragraph (1)(C), by inserting ‘‘and for 

19 provider education and overpayment appeals’’ before 

20 the period; 

21 (2) in paragraph (8)— 

22 (A) by striking ‘‘REPORT.—The Secretary’’ 

23 and inserting ‘‘REPORT.— 

24 ‘‘(A) IN GENERAL.—Subject to subpara25 graph (C), the Secretary’’; and 


jlentini on DSK4TPTVN1PROD with BILLS
13 

•S 1251 IS

1 (B) by adding after subparagraph (A), as 

2 inserted by subparagraph (A), the following new 

3 subparagraphs: 

4 ‘‘(B) INCLUSION OF IMPROPER PAYMENT

5 VULNERABILITIES IDENTIFIED.—Each report 

6 submitted under subparagraph (A) shall, sub7 ject to subparagraph (C), include— 

8 ‘‘(i) a description of— 

9 ‘‘(I) the types and financial cost 

10 to the program under this title of im11 proper payment vulnerabilities identi12 fied by recovery audit contractors 

13 under this subsection; and 

14 ‘‘(II) how the Secretary is ad15 dressing such improper payment 

16 vulnerabilities; and 

17 ‘‘(ii) an assessment of the effective18 ness of changes made to payment policies 

19 and procedures under this title in order to 

20 address the vulnerabilities so identified. 

21 ‘‘(C) LIMITATION.—The Secretary shall 

22 ensure that each report submitted under sub23 paragraph (A) does not include information 

24 that the Secretary determines would be senVerDate Mar 15 2010 20:26 Jun 29, 2011 Jkt 099200 PO 00000 Frm 00013 Fmt 6652 Sfmt 6201 E:\BILLS\S1251.IS S1251

jlentini on DSK4TPTVN1PROD with BILLS
14 

•S 1251 IS

1 sitive or would otherwise negatively impact pro2 gram integrity.’’; and 

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

4 paragraph: 

5 ‘‘(10) ADDRESSING IMPROPER PAYMENT

6 VULNERABILITIES.—The Secretary shall address im7 proper payment vulnerabilities identified by recovery 

8 audit contractors under this subsection in a timely 

9 manner.’’. 

10 SEC. 202. IMPROVING SENIOR MEDICARE PATROL AND 

11 FRAUD REPORTING REWARDS. 

12 (a) IN GENERAL.—The Secretary shall develop a 

13 plan, including suggested legislative changes to implement 

14 such plan, under which the Secretary shall revise the bene15 ficiary incentive program under section 203(b) of the 

16 Health Insurance Portability and Accountability Act of 

17 1996 (42 U.S.C. 1395b–5(b)) to encourage greater par18 ticipation by individuals to report fraud and abuse in the 

19 Medicare program. Such plan shall include recommenda20 tions for ways to enhance rewards for individuals report21 ing under the incentive program, including providing a 

22 monetary reward prior to the full recovery of an overpay23 ment. 

24 (b) PUBLIC AWARENESS AND EDUCATION CAM25 PAIGN.—The plan developed under subsection (a) shall 


jlentini on DSK4TPTVN1PROD with BILLS
15 

•S 1251 IS

1 also require the Secretary to use the Senior Medicare Pa2 trols authorized under section 411 of the Older Americans 

3 Act of 1965 (42 U.S.C. 3032) to conduct a public aware4 ness and education campaign to encourage participation 

5 in the revised beneficiary incentive program under sub6 section (a). 

7 (c) SUBMISSION OF PLAN.—Not later than 180 days 

8 after the date of enactment of this Act, the Secretary shall 

9 submit to Congress the plan developed under subsection 

10 (a). 

11 (d) DEFINITIONS.—In this section: 

12 (1) MEDICARE BENEFICIARY.—The term 

13 ‘‘Medicare beneficiary’’ means an individual entitled 

14 to, or enrolled for, benefits under part A of title 

15 XVIII of the Social Security Act (42 U.S.C. 1395c 

16 et seq.) or enrolled for benefits under part B of such 

17 title (42 U.S.C. 1395j et seq.). 

18 (2) MEDICARE PROGRAM.—The term ‘‘Medicare 

19 program’’ means the program under title XVIII of 

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

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

22 the Secretary of Health and Human Services. 


jlentini on DSK4TPTVN1PROD with BILLS
16 

•S 1251 IS

1 SEC. 203. PROHIBITING THE DISPLAY OF SOCIAL SECURITY 

2 ACCOUNT NUMBERS ON NEWLY ISSUED 

3 MEDICARE IDENTIFICATION CARDS AND 

4 COMMUNICATIONS PROVIDED TO MEDICARE 

5 BENEFICIARIES. 

6 (a) IN GENERAL.—Not later than 2 years after the 

7 date of enactment of this Act, the Secretary of Health and 

8 Human Services, in consultation with the Commissioner 

9 of Social Security, shall establish and begin to implement 

10 procedures to eliminate the unnecessary collection, use, 

11 and display of Social Security account numbers of Medi12 care beneficiaries. 

13 (b) NEWLY ISSUED MEDICARE CARDS AND COMMU14 NICATIONS PROVIDED TO BENEFICIARIES.— 

15 (1) NEWLY ISSUED CARDS.— 

16 (A) IN GENERAL.—Not later than 4 years 

17 after the date of enactment of this Act, the Sec18 retary of Health and Human Services, in con19 sultation with the Commissioner of Social Secu20 rity, shall ensure that each newly issued Medi21 care identification card meets the requirements 

22 described in subparagraph (B). 

23 (B) REQUIREMENTS.— 

24 (i) IN GENERAL.—Subject to clauses 

25 (ii) and (iii), the requirements described in 

26 this subparagraph are, with respect to a 


jlentini on DSK4TPTVN1PROD with BILLS
17 

•S 1251 IS

1 Medicare identification card, that the card 

2 does not display or electronically store (in 

3 an unencrypted format) a Medicare bene4 ficiary’s Social Security account number. 

5 (ii) EXCEPTION.—The Secretary may 

6 waive the requirements under clause (i) in 

7 the case where the health insurance claim 

8 number of a beneficiary is the Social Secu9 rity number of the beneficiary, the bene10 ficiary’s spouse, or another individual. 

11 (iii) USE OF PARTIAL ACCOUNT NUM12 BER.—The Secretary of Health and 

13 Human Services, in consultation with the 

14 Commissioner of Social Security, may pro15 vide for the use of a partial Social Security 

16 account number on a Medicare identifica17 tion card if the Secretary determines that 

18 such use does not allow an unacceptable 

19 risk of fraudulent use. 

20 (2) COMMUNICATIONS PROVIDED TO BENE21 FICIARIES.—Not later than 4 years after the date of 

22 enactment of this Act, the Secretary of Health and 

23 Human Services shall prohibit the display of a Medi24 care beneficiary’s Social Security account number on 

25 written or electronic communication provided to the 


jlentini on DSK4TPTVN1PROD with BILLS
18 

•S 1251 IS

1 beneficiary unless the Secretary, in consultation with 

2 the Commissioner of Social Security, determines 

3 that inclusion of Social Security account numbers on 

4 such communications is essential for the operation of 

5 the Medicare program. 

6 (c) MEDICARE BENEFICIARY DEFINED.—In this sec7 tion, the term ‘‘Medicare beneficiary’’ means an individual 

8 who is entitled to, or enrolled for, benefits under part A 

9 of title XVIII of the Social Security Act or enrolled under 

10 part B of such title. 

11 (d) CONFORMING AMENDMENTS.— 

12 (1) REFERENCE IN THE SOCIAL SECURITY

13 ACT.—Section 205(c)(2)(C) of the Social Security 

14 Act (42 U.S.C. 405(c)(2)(C)) is amended— 

15 (A) by moving clause (x), as added by sec16 tion 1414(a)(2) of the Patient Protection and 

17 Affordable Care Act (Public Law 111–148), 6 

18 ems to the left; 

19 (B) by redesignating clause (x), as added 

20 by section 2(a)(1) of the Social Security Num21 ber Protection Act of 2010 (42 U.S.C. 1305 

22 note), as clause (xii); and 

23 (C) by adding after clause (xii), as redesig24 nated by subparagraph (B), the following new 

25 clause: 


jlentini on DSK4TPTVN1PROD with BILLS
19 

•S 1251 IS

1 ‘‘(xiii) Subject to section 203 of the Medicare and 

2 Medicaid Fighting Fraud and Abuse to Save Taxpayers’ 

3 Dollars Act, social security account numbers shall not be 

4 displayed on Medicare identification cards or on commu5 nications provided to Medicare beneficiaries.’’. 

6 (2) ACCESS TO INFORMATION.—Section 205(r) 

7 of the Social Security Act (405 U.S.C. 405(r)) is 

8 amended by adding at the end the following new 

9 paragraph: 

10 ‘‘(10) To prevent and identify fraudulent activity, the 

11 Commissioner shall upon the request of the Attorney Gen12 eral or upon the request of the Secretary of Health and 

13 Human Services enter into a reimbursable agreement with 

14 the Attorney General or the Secretary to provide informa15 tion collected under paragraph (1) if— 

16 ‘‘(A) the requirements of subparagraphs (A) 

17 and (B) of paragraph (3) are met; and 

18 ‘‘(B) such agreement includes appropriate pro19 visions to protect the confidentiality of information 

20 provided by the Commissioner under such agree21 ment.’’. 

22 (e) PILOT PROGRAM.— 

23 (1) ESTABLISHMENT.—The Secretary shall es24 tablish a pilot program utilizing smart card tech25 nology to evaluate— 


jlentini on DSK4TPTVN1PROD with BILLS
20 

•S 1251 IS

1 (A) the applicability of smart card tech2 nology to the Medicare program under title 

3 XVIII of the Social Security Act (42 U.S.C. 

4 1395 et seq.), including the applicability of such 

5 technology to Medicare beneficiaries or Medi6 care providers; and 

7 (B) whether such cards would be effective 

8 in preventing fraud under the Medicare pro9 gram. 

10 (2) IMPLEMENTATION.— 

11 (A) INITIAL IMPLEMENTATION.—The Sec12 retary shall implement the pilot program under 

13 this subsection not later than 1 year after the 

14 date of enactment of this Act. 

15 (B) SCOPE AND DURATION.—The Sec16 retary shall conduct the pilot program— 

17 (i) in not less than 2 States; and 

18 (ii) for a period of not less than 180 

19 days or more than 2 years. 

20 (3) REPORT.—Not later than 12 months after 

21 the completion of the pilot program under this sub22 section, the Secretary shall submit to the appro23 priate committees of Congress and make available to 

24 the public a report that includes the following: 


jlentini on DSK4TPTVN1PROD with BILLS
21 

•S 1251 IS

1 (A) A summary of the pilot program and 

2 findings, including— 

3 (i) the costs or savings to the Medi4 care program as a result of the implemen5 tation of the pilot program; 

6 (ii) whether the use of smart card 

7 technology resulted in improvements in the 

8 quality of care provided to Medicare bene9 ficiaries under the pilot program; and 

10 (iii) whether such technology was use11 ful in preventing or detecting fraud, waste, 

12 and abuse in the Medicare program. 

13 (B) Recommendations regarding whether 

14 the use of smart card technology should be ex15 panded under the Medicare program. 

16 (4) DEFINITIONS.—In this subsection: 

17 (A) MEDICARE BENEFICIARY.—The term 

18 ‘‘Medicare beneficiary’’ means an individual en19 titled to, or enrolled for, benefits under part A 

20 of title XVIII of the Social Security Act (42 

21 U.S.C. 1395c et seq.) or enrolled for benefits 

22 under part B of such title (42 U.S.C. 1395j et 

23 seq.). 

24 (B) MEDICARE PROVIDER.—The term 

25 ‘‘Medicare provider’’ includes a provider of servVerDate Mar 15 2010 20:26 Jun 29, 2011 Jkt 099200 PO 00000 Frm 00021 Fmt 6652 Sfmt 6201 E:\BILLS\S1251.IS S1251

jlentini on DSK4TPTVN1PROD with BILLS
22 

•S 1251 IS

1 ices (as defined in section 1861(u) of the Social 

2 Security Act (42 U.S.C. 1395x(u))) and a sup3 plier (as defined in section 1861(d) of such Act 

4 (42 U.S.C. 1395x(d))). 

5 (C) SECRETARY.—The term ‘‘Secretary’’ 

6 means the Secretary of Health and Human 

7 Services. 

8 (D) SMART CARD.—The term ‘‘smart 

9 card’’ means identification used by a Medicare 

10 beneficiary or a Medicare provider that includes 

11 anti-fraud attributes. Such a card— 

12 (i) may rely on existing commercial 

13 data transfer networks or on a network of 

14 proprietary card readers or databases; and 

15 (ii) may include— 

16 (I) cards using technology adapt17 ed from the financial services indus18 try; 

19 (II) cards containing individual 

20 biometric identification, provided that 

21 such identification is encrypted and 

22 not contained in any central database; 

23 (III) cards adapting technology 

24 and processes utilized in the 

25 TRICARE program under chapter 55 


jlentini on DSK4TPTVN1PROD with BILLS
23 

•S 1251 IS

1 of title 10, United States Code, or by 

2 the Veterans Administration; or 

3 (IV) such other technology as the 

4 Secretary determines appropriate. 

5 SEC. 204. REQUIRING PREPAYMENT REVIEW OF ALL 

6 CLAIMS FOR DURABLE MEDICAL EQUIPMENT 

7 AT HIGH RISK OF WASTE, FRAUD, AND 

8 ABUSE. 

9 Section 1834(a) of the Social Security Act (42 U.S.C. 

10 1395m(a)) is amended by adding at the end the following 

11 new paragraph: 

12 ‘‘(22) PREPAYMENT REVIEW FOR DURABLE

13 MEDICAL EQUIPMENT AT HIGH RISK OF FRAUD.— 

14 Not later than 270 days after the date of enactment 

15 of the Medicare and Medicaid Fighting Fraud and 

16 Abuse to Save Taxpayers’ Dollars Act, the Sec17 retary, in consultation with the Inspector General of 

18 the Department of Health and Human Services, 

19 shall establish policies and procedures for prepay20 ment review, which may include pre-certification, for 

21 all claims for reimbursement under this title for du22 rable medical equipment at high risk of waste, 

23 fraud, and abuse, as determined by the Secretary, 

24 including power wheelchairs.’’. 


jlentini on DSK4TPTVN1PROD with BILLS
24 

•S 1251 IS

1 SEC. 205. STRENGTHENING MEDICAID PROGRAM INTEG2 RITY THROUGH FLEXIBILITY. 

3 Section 1936 of the Social Security Act (42 U.S.C. 

4 1396u–6) is amended— 

5 (1) in subsection (a), by inserting ‘‘, or other6 wise,’’ after ‘‘entities’’; and 

7 (2) in subsection (e)— 

8 (A) in paragraph (1), in the matter pre9 ceding subparagraph (A), by inserting ‘‘(includ10 ing the costs of equipment, salaries and bene11 fits, and travel and training)’’ after ‘‘Program 

12 under this section’’; and 

13 (B) in paragraph (3), by striking ‘‘by 100’’ 

14 and inserting ‘‘by 100, or such number as de15 termined necessary by the Secretary to carry 

16 out the Program,’’. 

17 TITLE III—IMPROVING DATA 

18 SHARING ACROSS AGENCIES 

19 AND PROGRAMS 

20 SEC. 301. IMPROVING DATA SHARING ACROSS AGENCIES 

21 AND PROGRAMS. 

22 (a) IN GENERAL.—In order to ensure that the Sec23 retary, Medicare program safeguard contractors and other 

24 oversight contractors (as defined in subsection (g)(4)), the 

25 Inspector General of the Department of Health and 

26 Human Services, the Attorney General, and State and 


jlentini on DSK4TPTVN1PROD with BILLS
25 

•S 1251 IS

1 local law enforcement are able to operate with greater co2 ordination to curb fraud and improper payments, the Sec3 retary, the Inspector General of the Department of Health 

4 and Human Services, and the Attorney General shall pro5 vide for increased coordination and data sharing as de6 scribed in the succeeding subsections. 

7 (b) IMPROVING DATA SHARING INTERNALLY AND

8 WITH CMS CONTRACTORS.— 

9 (1) IN GENERAL.—The Secretary shall establish 

10 policies and procedures to ensure that claims and 

11 other data, including the data described in para12 graph (3), is accessible to Medicare program safe13 guard contractors and other oversight contractors 

14 not less frequently than on a daily basis. 

15 (2) ANALYSIS OF DATA.—The Secretary shall 

16 require Medicare program safeguard contractors and 

17 other oversight contractors to analyze the data 

18 accessed under paragraph (1) on an ongoing basis 

19 for purposes of conducting pre- and post-payment 

20 reviews under the Medicare program. 

21 (3) DATA DESCRIBED.—The following data is 

22 described in this paragraph: 

23 (A) Claims payment, claims denial, and 

24 other claims data under the Medicare program 


jlentini on DSK4TPTVN1PROD with BILLS
26 

•S 1251 IS

1 from the common working file and the Medicare 

2 national claims history database. 

3 (B) Data on providers of services and sup4 pliers under the Medicare program, including 

5 data from the Medicare Provider Enrollment, 

6 Chain, and Ownership System (PECOS) of the 

7 Centers for Medicare & Medicaid Services. 

8 (C) Medicare beneficiary data, including 

9 data from the Enrollment DataBase of the Cen10 ters for Medicare & Medicaid Services. 

11 (c) PROVIDER DATABASE REVIEWS AND

12 VERIFICATION.— 

13 (1) IN GENERAL.— 

14 (A) REVIEW AND UPDATE OF MEDICARE

15 PROVIDER DATABASES.—The Secretary shall 

16 establish policies and procedures, which may in17 clude contractors, to review and update on a 

18 daily basis Medicare provider databases, includ19 ing the review and update of the Medicare Pro20 vider Enrollment, Chain, and Ownership Sys21 tem (PECOS) of the Centers for Medicare & 

22 Medicaid Services against death data of the So23 cial Security Administration, for accuracy and 

24 completeness. Such policies and procedures 

25 shall also include data matches on a daily basis, 


jlentini on DSK4TPTVN1PROD with BILLS
27 

•S 1251 IS

1 as determined appropriate by the Secretary, 

2 against other databases as determined appro3 priate by the Secretary, including the database 

4 of the Drug Enforcement Agency of persons 

5 registered to manufacture, distribute, or dis6 pense a controlled substance under part C of 

7 title II of the Controlled Substances Act (21 

8 U.S.C. 821 et seq.), State medical licensing 

9 data, databases of suspended or debarred Fed10 eral contractors, including the Excluded Parties 

11 List System of the General Services Adminis12 tration, the Debt Check program of the Depart13 ment of the Treasury, a list of incarcerated in14 dividuals from the Department of Justice and 

15 each State’s Department of Corrections, and 

16 the List of Excluded Individuals/Entities of the 

17 Office of Inspector General of the Department 

18 of Health and Human Services. 

19 (B) CONSULTATION.—The policies and 

20 procedures under subparagraph (A) shall re21 quire the Secretary to periodically consult with 

22 external organizations, including the Federation 

23 of State Medical Boards, to determine data 

24 sources and screening tools best suited to detect 

25 fraudulent applications for enrollment under 


jlentini on DSK4TPTVN1PROD with BILLS
28 

•S 1251 IS

1 section 1866(j) of the Social Security Act (42 

2 U.S.C. 1395cc(j)) submitted by providers of 

3 medical or other items or services and suppliers 

4 under the Medicare program. 

5 (C) DATA MATCHING.— 

6 (i) IN GENERAL.—The policies and 

7 procedures under subparagraph (A) may 

8 include entering into agreements with the 

9 Commissioner of Social Security pursuant 

10 to section 205(r) of the Social Security Act 

11 (42 U.S.C. 405(r)) to match data against 

12 the death information maintained by the 

13 Commissioner, and matching against the 

14 database of the Drug Enforcement Agency 

15 of persons registered to manufacture, dis16 tribute, or dispense a controlled substance 

17 under part C of title II of the Controlled 

18 Substances Act (21 U.S.C. 821 et seq.), 

19 and other Federal databases, as deter20 mined appropriate by the Secretary. 

21 (ii) CONFIDENTIALITY OF DATA OB22 TAINED.—The Secretary shall take any ac23 tions required by an agreement described 

24 in clause (i) or any other agreement with 

25 the Commissioner of Social Security to obVerDate Mar 15 2010 20:26 Jun 29, 2011 Jkt 099200 PO 00000 Frm 00028 Fmt 6652 Sfmt 6201 E:\BILLS\S1251.IS S1251

jlentini on DSK4TPTVN1PROD with BILLS
29 

•S 1251 IS

1 tain data from the Commissioner for pur2 poses of this section to maintain the con3 fidentiality of data obtained from the Com4 missioner and to assure that the data is 

5 used solely for the purposes of this section. 

6 (D) ONGOING ANALYSIS.—The Secretary 

7 shall use analytic software for the conduct of 

8 ongoing analysis of Medicare provider databases 

9 described in subparagraph (A) to verify and up10 date data supplied by providers of services and 

11 suppliers under the Medicare program. The 

12 Secretary may use commercial database sources 

13 for purposes of verifying such data. 

14 (2) ACCESS TO NATIONAL DIRECTORY OF NEW

15 HIRES.—Section 453(j) of the Social Security Act 

16 (42 U.S.C. 653(j)) is amended by adding at the end 

17 the following new paragraph: 

18 ‘‘(12) PROVISION OF NEW HIRE INFORMATION

19 TO THE CENTERS FOR MEDICARE & MEDICAID SERV20 ICES AND APPLICABLE STATE HEALTH SUBSIDY

21 PROGRAMS.—The National Directory of New Hires 

22 shall provide the Administrator of the Centers for 

23 Medicare & Medicaid Services and, for purposes of 

24 carrying out section 1413(c)(3)(A)(ii) of Public Law 

25 111–148, each applicable State health subsidy proVerDate Mar 15 2010 20:26 Jun 29, 2011 Jkt 099200 PO 00000 Frm 00029 Fmt 6652 Sfmt 6201 E:\BILLS\S1251.IS S1251

jlentini on DSK4TPTVN1PROD with BILLS
30 

•S 1251 IS

1 gram (as defined in section 1413(e) of such Public 

2 Law) with all information in the National Direc3 tory.’’ 

4 (3) ACCESS TO LIST OF CONVICTED INDIVID5 UALS.—The Attorney General shall provide the Sec6 retary of Health and Human Services access to a 

7 list of convicted individuals for use in preventing 

8 waste, fraud, and abuse under the Medicare and 

9 Medicaid programs. 

10 (d) BENEFICIARY DATABASE REVIEW AND

11 VERIFICATION.— 

12 (1) IN GENERAL.—The Secretary shall establish 

13 policies and procedures, which may include contrac14 tors, to review and update on a daily basis Medicare 

15 beneficiary databases, including the Enrollment 

16 DataBase of the Centers for Medicare & Medicaid 

17 Services, for accuracy and completeness. Such poli18 cies and procedures shall include data matches 

19 against death data of the Social Security Adminis20 tration and also on a daily basis, as determined ap21 propriate by the Secretary, other Federal databases 

22 as determined appropriate by the Secretary, includ23 ing a list of incarcerated individuals from the De24 partment of Justice and each State’s Department of 

25 Corrections. 


jlentini on DSK4TPTVN1PROD with BILLS
31 

•S 1251 IS

1 (2) ONGOING ANALYSIS.—The Secretary shall 

2 use analytic software for the conduct of ongoing 

3 analysis of Medicare beneficiary databases described 

4 in paragraph (1) to verify and update data supplied 

5 by providers of services and suppliers under the 

6 Medicare program. The Secretary may use commer7 cial database sources for purposes of verifying such 

8 data. 

9 (e) CONTINUED EFFORTS ON INTEGRATED DATA

10 REPOSITORY AND ONE PI PROJECT; EXPANDED ACCESS

11 BY AGENCIES.— 

12 (1) CONTINUED EFFORTS ON INTEGRATED

13 DATA REPOSITORY AND ONE PI PROJECT.— 

14 (A) IN GENERAL.—The Secretary shall— 

15 (i) continue to incorporate Medicare 

16 claims and payment, provider, and bene17 ficiary data into the Integrated Data Re18 pository under section 1128J(a)(1) of the 

19 Social Security Act, as added by section 

20 6402(a) of the Patient Protection and Af21 fordable Care Act; and 

22 (ii) fully implement the waste, fraud, 

23 and abuse detection solution of the Centers 

24 for Medicare & Medicaid Services, called 

25 the ‘‘One PI project’’. 


jlentini on DSK4TPTVN1PROD with BILLS
32 

•S 1251 IS

1 (B) UPDATING OF IDR ON DAILY BASIS.— 

2 The Secretary shall establish policies and proce3 dures to ensure that the Integrated Data Re4 pository is updated with Medicare claims pay5 ment data and data from the Medicare provider 

6 databases described in subsection (c)(1) and 

7 Medicare beneficiary databases described in 

8 subsection (d)(1), including the common work9 ing file, on a daily basis. 

10 (C) ACCESS TO IDR.—The Secretary shall 

11 ensure that Medicare program safeguard con12 tractors and other oversight contractors have 

13 access to the full range of data contained in the 

14 Integrated Data Repository and related analytic 

15 tools by not later than September 30, 2012. 

16 Such access shall include both real-time portal 

17 access and other means in accordance with pro18 tocols established by the Secretary. 

19 (D) LAW ENFORCEMENT ACCESS.—The 

20 Secretary shall ensure that Federal and other 

21 appropriate law enforcement agencies, including 

22 the Inspector General of the Department of 

23 Health and Human Services and the Attorney 

24 General, have access to the full range of data 

25 contained in the Integrated Data Repository 


jlentini on DSK4TPTVN1PROD with BILLS
33 

•S 1251 IS

1 and related analytic tools by not later than Sep2 tember 30, 2012. Such access shall include both 

3 real-time portal access and other means in ac4 cordance with protocols established by the Sec5 retary. 

6 (E) DATE CERTAIN FOR INCLUSION OF

7 PREPAYMENT CLAIMS DATA.—The Secretary 

8 shall ensure that the Integrated Data Reposi9 tory includes access to prepayment claims data 

10 by not later than September 30, 2012. 

11 (F) DATE CERTAIN FOR INCLUSION OF

12 MEDICAID PROGRAM DATA.—The Secretary 

13 shall ensure that the Integrated Data Reposi14 tory includes access to or incorporates Medicaid 

15 program data by not later than September 30, 

16 2014 (or, if States are unable to provide certain 

17 data to the Secretary by such date, a substan18 tial amount of the Medicaid program data that 

19 is available as of such date). 

20 (2) EXPANDED DATABASE ACCESS TO APPRO21 PRIATE STATE ENTITIES.— 

22 (A) ACCESS TO INTEGRATED DATA REPOS23 ITORY.—For purposes of enhancing data shar24 ing in order to identify programmatic weak25 nesses and improving the timeliness of analysis 


jlentini on DSK4TPTVN1PROD with BILLS
34 

•S 1251 IS

1 and actions to prevent waste, fraud, and abuse, 

2 relevant State agencies, including the State 

3 Medicaid plans under title XIX of the Social 

4 Security Act, State child health plans under 

5 title XXI of such Act, and State Medicaid fraud 

6 control units (as described in section 1903(q) of 

7 the Social Security Act (42 U.S.C. 1396b(q))), 

8 shall have access to the full range of data con9 tained in the Integrated Data Repository, in10 cluding the One PI system established under 

11 the One PI project, as directed by the Sec12 retary, by not later than September 30, 2013. 

13 The Secretary may, in consultation with the In14 spector General of the Department of Health 

15 and Human Services, give such access to State 

16 attorneys general and State law enforcement 

17 agencies. 

18 (B) CONFORMING AMENDMENTS.—Section 

19 1128J(a)(2) of the Social Security Act, as 

20 added by section 6402(a) of the Patient Protec21 tion and Affordable Care Act (Public Law 111– 

22 148) is amended— 

23 (i) by striking ‘‘DATABASES.—’’ 

24 and inserting ‘‘DATABASES.—’’ 


jlentini on DSK4TPTVN1PROD with BILLS
35 

•S 1251 IS

1 ‘‘(A) ACCESS FOR THE CONDUCT OF LAW

2 ENFORCEMENT AND OVERSIGHT ACTIVITIES.— 

3 For purposes’’; 

4 (ii) in subparagraph (A), as added by 

5 subclause (I), by inserting ‘‘, including, in 

6 accordance with section 301(e)(1)(D) of 

7 the Medicare and Medicaid Fighting Fraud 

8 and Abuse to Save Taxpayers’ Dollars Act, 

9 the Integrated Data Repository under 

10 paragraph (1)’’ before the period at the 

11 end; and 

12 (iii) by adding at the end the fol13 lowing new subparagraph: 

14 ‘‘(B) ACCESS TO REDUCE WASTE, FRAUD, 

15 AND ABUSE.—For purposes of reducing waste, 

16 fraud, and abuse, and to the extent consistent 

17 with applicable information, privacy, security, 

18 and disclosure laws, including the regulations 

19 promulgated under the Health Insurance Port20 ability and Accountability Act of 1996 and sec21 tion 552a of title 5, United States Code, and 

22 subject to any information systems security re23 quirements under such laws or otherwise re24 quired by the Secretary, the Secretary, in con25 sultation with the Inspector General of the DeVerDate Mar 15 2010 20:26 Jun 29, 2011 Jkt 099200 PO 00000 Frm 00035 Fmt 6652 Sfmt 6201 E:\BILLS\S1251.IS S1251

jlentini on DSK4TPTVN1PROD with BILLS
36 

•S 1251 IS

1 partment of Health and Human Services, shall 

2 allow appropriate State agency access to claims 

3 and payment data of the Department of Health 

4 and Human Services and its contractors related 

5 to titles XVIII, XIX, and XXI, including, in ac6 cordance with section 301(e)(2)(A) of the Medi7 care and Medicaid Fighting Fraud and Abuse 

8 to Save Taxpayers’ Dollars Act, the Integrated 

9 Data Repository under paragraph (1).’’. 

10 (f) GENERAL PROTOCOLS AND SECURITY.— 

11 (1) IN GENERAL.—The Secretary shall ensure 

12 that any data provided to an entity or individual 

13 under the provisions of or amendments made by this 

14 section is provided to such entity or individual in ac15 cordance with protocols established by the Secretary 

16 under paragraph (2). The Secretary shall consult 

17 with the Inspector General of the Department of 

18 Health and Human Services prior to implementing 

19 this subsection. 

20 (2) PROTOCOLS.— 

21 (A) IN GENERAL.—The Secretary shall es22 tablish protocols to ensure the secure transfer 

23 and storage of any data provided to another en24 tity or individual under the provisions of or 

25 amendments made by this section. 


jlentini on DSK4TPTVN1PROD with BILLS
37 

•S 1251 IS

1 (B) CONSIDERATION OF RECOMMENDA2 TIONS OF THE INSPECTOR GENERAL OF THE

3 DEPARTMENT OF HEALTH AND HUMAN SERV4 ICES.—In establishing protocols under subpara5 graph (A), the Secretary shall take into account 

6 recommendations submitted to the Secretary by 

7 the Inspector General of the Department of 

8 Health and Human Services with respect to the 

9 secure transfer and storage of such data. 

10 (g) DEFINITIONS.—In this section: 

11 (1) FEDERAL HEALTH CARE PROGRAM.—The 

12 term ‘‘Federal health care program’’ has the mean13 ing given such term in section 1128B(f) of the So14 cial Security Act (42 U.S.C. 1320a–7b(f)). 

15 (2) MEDICAID PROGRAM.—The term ‘‘Medicaid 

16 program’’ means the program under title XIX of the 

17 Social Security Act (42 U.S.C. 1396 et seq.). 

18 (3) MEDICARE PROGRAM.—The term ‘‘Medicare 

19 program’’ means the program under title XVIII of 

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

21 (4) MEDICARE PROGRAM SAFEGUARD CONTRAC22 TORS AND OTHER OVERSIGHT CONTRACTORS.—The 

23 term ‘‘Medicare program safeguard contractors and 

24 other oversight contractors’’ includes zone program 

25 integrity contractors, program safeguard or integrity 


jlentini on DSK4TPTVN1PROD with BILLS
38 

•S 1251 IS

1 contractors, recovery audit contractors under section 

2 1893(h) of the Social Security Act (42 U.S.C. 

3 1395ddd(h)), special investigative units at Medicare 

4 contractors (as defined in section 1889(g) of the So5 cial Security Act (42 U.S.C. 1395zz(g))), and any 

6 other oversight contractors designated by the Sec7 retary. 

8 (5) PROVIDER OF SERVICES.—The term ‘‘pro9 vider of services’’ has the meaning given such term 

10 in section 1861(u) of the Social Security Act (42 

11 U.S.C. 1395x(u)). 

12 (6) SECRETARY.—The term ‘‘Secretary’’ means 

13 the Secretary of Health and Human Services. 

14 (7) STATE.—The term ‘‘State’’ includes the 

15 District of Columbia, the Commonwealth of Puerto 

16 Rico, the Virgin Islands, Guam, and American 

17 Samoa. 

18 (8) SUPPLIER.—The term ‘‘supplier’’ has the 

19 meaning given such term in section 1861(d) of the 

20 Social Security Act (42 U.S.C. 1395x(d)). 

21 SEC. 302. EXPANDING AUTOMATED PREPAYMENT REVIEW 

22 OF MEDICARE CLAIMS. 

23 (a) AUTOMATED PREPAYMENT REVIEW.— 

24 (1) IN GENERAL.—Subject to subsection (b), 

25 the Secretary shall establish automated prepayment 


jlentini on DSK4TPTVN1PROD with BILLS
39 

•S 1251 IS

1 review of all Medicare claims under parts A and B 

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

3 1395 et seq.) by not later than September 30, 2012. 

4 (2) IMPLEMENTATION.—The provisions of this 

5 section shall be implemented in conjunction with, 

6 and as part of, any predictive modeling and other 

7 analytics technologies implemented under section 

8 4241 of the Small Business Jobs Act of 2010 (42 

9 U.S.C. 1320a–7n), except that any requirement 

10 under such section 4241 that conflicts with a re11 quirement under this section shall not apply to this 

12 section. 

13 (b) ELEMENTS.—Such automated prepayment review 

14 shall include the following: 

15 (1) PROGRAM INTEGRITY SYSTEM.— 

16 (A) IN GENERAL.—Subject to subpara17 graph (D), a program integrity system under 

18 which relevant claims under such parts A and 

19 B are compared in order to— 

20 (i) identify errors or fraud under the 

21 Medicare program, including— 

22 (I) duplicate claims for items or 

23 services; and 

24 (II) claims where payment of 

25 benefits under one such part is only 


jlentini on DSK4TPTVN1PROD with BILLS
40 

•S 1251 IS

1 available if such payment is not avail2 able under another such part; and 

3 (ii) obtain such other information or 

4 conduct such other analysis as the Sec5 retary determines is useful for program in6 tegrity purposes. 

7 (B) IMPLEMENTATION.—Not later than 

8 September 30, 2013, the Secretary shall ensure 

9 that all relevant daily claims data under such 

10 parts A and B are compared as part of such 

11 program integrity system. 

12 (C) PLAN FOR INCLUSION OF PART D

13 CLAIMS DATA.—Not later than September 30, 

14 2013, the Secretary shall establish a plan for 

15 including Medicare claims under part D of such 

16 title XVIII (42 U.S.C. 1395w–101 et seq.) for 

17 use in comparisons under such program integ18 rity system. 

19 (D) NO IMPACT ON PROMPT PAYMENT RE20 QUIREMENTS.—In no case shall the program in21 tegrity system under this paragraph have any 

22 impact on prompt payment requirements under 

23 such parts A and B, including such require24 ments under sections 1816(c)(2) and 


jlentini on DSK4TPTVN1PROD with BILLS
41 

•S 1251 IS

1 1842(c)(2) of the Social Security Act (42 

2 U.S.C. 1395h(c)(2); 1395u(c)(2)). 

3 (2) AUTOMATED RISK-BASED PROVIDER

4 VERIFICATION.— 

5 (A) IN GENERAL.—An automated risk6 based verification system for the purpose of 

7 verification and analysis of providers of services 

8 and suppliers under the Medicare program on 

9 an ongoing basis, including during the period 

10 between the enrollment of the provider of serv11 ices or supplier under section 1866(j) of the So12 cial Security Act (42 U.S.C. 1395cc(j)) and the 

13 revalidation (or any subsequent revalidation) of 

14 such provider of services or supplier under such 

15 section. Subject to subparagraph (C), such sys16 tem shall include criminal background checks 

17 for providers of services and suppliers who the 

18 Secretary determines present a high risk of 

19 waste, fraud, and abuse. 

20 (B) IMPLEMENTATION.—The Secretary 

21 shall establish the system under subparagraph 

22 (A) not later than September 30, 2013. 

23 (C) NO DUPLICATION OF SCREENING

24 UNDER ENROLLMENT PROCESS.—The system 

25 under subparagraph (A) shall be in addition to 


jlentini on DSK4TPTVN1PROD with BILLS
42 

•S 1251 IS

1 and shall not duplicate any screening, including 

2 any criminal background check, conducted 

3 under section 1866(j)(2) of the Social Security 

4 Act (42 U.S.C. 1395cc(j)(2)). 

5 (D) PROHIBITION ON DISCLOSURE OF

6 RISK-BASED DATA AND ANALYSIS.—The Sec7 retary shall not disclose to the public any data 

8 collected or analysis conducted under the auto9 mated risk-based verification system under sub10 paragraph (A). 

11 (3) TRACKING REJECTED CLAIMS.— 

12 (A) IN GENERAL.—For the purpose of 

13 identifying and analyzing potentially fraudulent 

14 and otherwise inappropriate claims under the 

15 Medicare program, a process for identifying and 

16 tracking, including by provider of services or 

17 supplier, claims for payment under the Medi18 care program that were rejected or denied 

19 under the automated edit process of a medicare 

20 administrative contractor under section 1874A 

21 of the Social Security Act (42 U.S.C. 1395kk). 

22 (B) IMPLEMENTATION.—The Secretary 

23 shall establish the process under subparagraph 

24 (A) not later than September 30, 2013. 

25 (c) DEFINITIONS.—In this section: 


jlentini on DSK4TPTVN1PROD with BILLS
43 

•S 1251 IS

1 (1) MEDICARE PROGRAM.—The term ‘‘Medicare 

2 program’’ means the program under title XVIII of 

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

4 (2) AUTOMATED PREPAYMENT REVIEW.—The 

5 term ‘‘automated prepayment review’’ means screen6 ing using automated data analysis and intelligent 

7 analysis prior to making payment. Such term does 

8 not include prepayment medical review. 

9 (3) PROVIDER OF SERVICES.—The term ‘‘pro10 vider of services’’ has the meaning given that term 

11 in section 1861(u) of such Act (42 U.S.C. 

12 1395ww(u)). 

13 (4) SECRETARY.—The term ‘‘Secretary’’ means 

14 the Secretary of Health and Human Services. 

15 (5) SUPPLIER.—The term ‘‘supplier’’ has the 

16 meaning given such term in section 1861(d) of such 

17 Act (42 U.S.C. 1395ww(d)). 

18 SEC. 303. IMPROVING THE SHARING OF DATA BETWEEN 

19 THE FEDERAL GOVERNMENT AND STATE 

20 MEDICAID PROGRAMS. 

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

22 Human Services (in this section referred to as the ‘‘Sec23 retary’’) shall establish a plan to encourage and facilitate 

24 the inclusion of States in the Medicare-Medicaid Data 

25 Match Program (commonly referred to as the ‘‘Medi-Medi 


jlentini on DSK4TPTVN1PROD with BILLS
44 

•S 1251 IS

1 Program’’) under section 1893(g) of the Social Security 

2 Act (42 U.S.C. 1395ddd(g)). 

3 (b) PROGRAM REVISIONS TO IMPROVE MEDI-MEDI

4 DATA MATCH PROGRAM PARTICIPATION BY STATES.— 

5 Section 1893(g)(1)(A) of the Social Security Act (42 

6 U.S.C. 1395ddd(g)(1)(A)) is amended— 

7 (1) in the matter preceding clause (i), by insert8 ing ‘‘or otherwise’’ after ‘‘eligible entities’’; 

9 (2) in clause (i)— 

10 (A) by inserting ‘‘to review claims data’’ 

11 after ‘‘algorithms’’; and 

12 (B) by striking ‘‘service, time, or patient’’ 

13 and inserting ‘‘provider, service, time, or pa14 tient’’; 

15 (3) in clause (ii)— 

16 (A) by inserting ‘‘to investigate and re17 cover amounts with respect to suspect claims’’ 

18 after ‘‘appropriate actions’’; and 

19 (B) by striking ‘‘; and’’ and inserting a 

20 semicolon; 

21 (4) in clause (iii), by striking the period and in22 serting ‘‘; and’’; and 

23 (5) by adding at end the following new clause: 

24 ‘‘(iv) furthering the Secretary’s de25 sign, development, installation, or enhanceVerDate Mar 15 2010 20:26 Jun 29, 2011 Jkt 099200 PO 00000 Frm 00044 Fmt 6652 Sfmt 6201 E:\BILLS\S1251.IS S1251

jlentini on DSK4TPTVN1PROD with BILLS
45 

•S 1251 IS

1 ment of an automated data system archi2 tecture— 

3 ‘‘(I) to collect, integrate, and as4 sess data for purposes of program in5 tegrity, program oversight, and ad6 ministration, including the Medi-Medi 

7 Program; and 

8 ‘‘(II) that improves the coordina9 tion of requests for data from 

10 States.’’. 

11 (c) PROVIDING STATES WITH DATA ON IMPROPER

12 PAYMENTS MADE FOR ITEMS OR SERVICES PROVIDED TO

13 DUAL ELIGIBLE INDIVIDUALS.— 

14 (1) IN GENERAL.—The Secretary shall develop 

15 and implement a plan that allows each State agency 

16 responsible for administering a State plan for med17 ical assistance under title XIX of the Social Security 

18 Act access to relevant data on improper or erroneous 

19 payments made under the Medicare program under 

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

21 1395 et seq.) for health care items or services pro22 vided to dual eligible individuals. 

23 (2) DUAL ELIGIBLE INDIVIDUAL DEFINED.—In 

24 this section, the term ‘‘dual eligible individual’’ 

25 means an individual who is entitled to, or enrolled 


jlentini on DSK4TPTVN1PROD with BILLS
46 

•S 1251 IS

1 for, benefits under part A of title XVIII of the So2 cial Security Act (42 U.S.C. 1395c et seq.), or en3 rolled for benefits under part B of title XVIII of 

4 such Act (42 U.S.C. 1395j et seq.), and is eligible 

5 for medical assistance under a State plan under title 

6 XIX of such Act (42 U.S.C. 1396 et seq.) or under 

7 a waiver of such plan. 

8 SEC. 304. IMPROVING CLAIMS PROCESSING AND DETEC9 TION OF FRAUD WITHIN THE MEDICAID AND 

10 CHIP PROGRAMS. 

11 (a) MEDICAID.—Section 1903(i) of the Social Secu12 rity Act (42 U.S.C. 1396b(i)), as amended by section 

13 2001(a)(2)(B) of the Patient Protection and Affordable 

14 Care Act (Public Law 111–148), is amended— 

15 (1) in paragraph (25), by striking ‘‘or’’ at the 

16 end; 

17 (2) in paragraph (26), by striking the period 

18 and inserting ‘‘; or’’; and 

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

20 paragraph: 

21 ‘‘(27) with respect to amounts expended for an 

22 item or service for which medical assistance is pro23 vided under the State plan or under a waiver of such 

24 plan unless the claim for payment for such item or 

25 service contains— 


jlentini on DSK4TPTVN1PROD with BILLS
47 

•S 1251 IS

1 ‘‘(A) a valid beneficiary identification num2 ber that, for purposes of the individual who re3 ceived such item or service, has been deter4 mined by the State agency to correspond to an 

5 individual who is eligible to receive benefits 

6 under the State plan or waiver; and 

7 ‘‘(B) a valid provider identifier that, for 

8 purposes of the provider that furnished such 

9 item or service, has been determined by the 

10 State agency to correspond to a participating 

11 provider that is eligible to receive payment for 

12 furnishing such item or service under the State 

13 plan or waiver.’’. 

14 (b) CHIP.—Section 2107(e)(1)(I) of the Social Secu15 rity Act (42 U.S.C. 1397gg(e)(1)(I)) is amended by strik16 ing ‘‘and (17)’’ and inserting ‘‘(17), and (27)’’. 

17 SEC. 305. REPORTS. 

18 (a) REPORT TO CONGRESS ON PLAN FOR IMPLEMEN19 TATION.— 

20 (1) REPORT.— 

21 (A) IN GENERAL.—Not later than 270 

22 days after the date of enactment of this Act, 

23 the Secretary of Health and Human Services, 

24 in consultation with the Commissioner of Social 

25 Security and the Attorney General, shall submit 


jlentini on DSK4TPTVN1PROD with BILLS
48 

•S 1251 IS

1 to Congress a report containing a plan for im2 plementing the provisions of and amendments 

3 made by sections 301 through 304, including, 

4 with respect to the implementation of section 

5 303, the plan described in subparagraph (B). 

6 (B) PLAN FOR INCREASING RECOVERY OF

7 OVERPAYMENTS.—The report submitted under 

8 subparagraph (A) shall include a plan, devel9 oped by the Secretary of Health and Human 

10 Services, in consultation with the inspector 

11 General of the Department of Health and 

12 Human Services, to increase the recovery of 

13 overpayments for health care items or services 

14 provided to dual eligible individuals (as defined 

15 in section 303(c)(2)). 

16 (2) INCLUSION IN ANNUAL HEALTH CARE

17 FRAUD AND ABUSE CONTROL ACCOUNT REPORT.— 

18 Section 1817(k)(5) of the Social Security Act (42 

19 U.S.C. 1395i(k)(5)) is amended— 

20 (A) in subparagraph (A), by striking 

21 ‘‘and’’ at the end; 

22 (B) in subparagraph (B), by striking the 

23 period at the end and inserting ‘‘; and’’; and 

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

25 subparagraph: 


jlentini on DSK4TPTVN1PROD with BILLS
49 

•S 1251 IS

1 ‘‘(C) effective beginning with the report 

2 submitted January 1 following the date the re3 port under section 306(a)(1) of the Medicare 

4 and Medicaid Fighting Fraud and Abuse to 

5 Save Taxpayers’ Dollars Act is submitted, any 

6 updates to the plan included in the report 

7 under such section 306(a)(1), including any po8 tential challenges to meeting the deadlines for 

9 implementation of the provisions of and amend10 ments made by sections 301 through 304 of 

11 such Act.’’. 

12 (b) REPORT TO CONGRESS ON INTERAGENCY CO13 OPERATION AND DATA SHARING.—Not later than 180 

14 days after the date of enactment of this Act, the Secretary 

15 of Health and Human Services, in consultation with the 

16 Administrator of the Veterans Administration, the Sec17 retary of Defense, the Director of the Office of Personnel 

18 Management, and the head of any other relevant Federal 

19 agency that administers a Federal health care program, 

20 shall submit to Congress a report on the potential of data 

21 sharing, including the sharing or data checking of Medi22 care provider and Medicare beneficiary databases, to pre23 vent and detect potential fraud and improper payments 

24 under the Medicare program. 


jlentini on DSK4TPTVN1PROD with BILLS
50 

•S 1251 IS

1 TITLE IV—IMPROVING CMS 

2 CONTRACTOR PERFORMANCE 

3 SEC. 401. ESTABLISHING MEDICARE ADMINISTRATIVE CON4 TRACTOR ERROR REDUCTION INCENTIVES. 

5 (a) IN GENERAL.—Section 1874A(b)(1)(D) of the 

6 Social Security Act (42 U.S.C. 1395kk(b)(1)(D)) is 

7 amended— 

8 (1) by striking ‘‘QUALITY.—The Secretary’’ and 

9 inserting ‘‘QUALITY.— 

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

11 (ii) and (iii), the Secretary’’; and 

12 (2) by inserting after clause (i), as added by 

13 paragraph (1), the following new clauses: 

14 ‘‘(ii) IMPROPER PAYMENT ERROR

15 RATE REDUCTION INCENTIVE PLAN.—The 

16 Secretary shall establish a plan to provide 

17 incentives for medicare administrative con18 tractors to reduce the improper payment 

19 error rates in their jurisdictions. 

20 ‘‘(iii) CONTENTS OF PLAN.—The plan 

21 established under clause (ii)— 

22 ‘‘(I) may include a sliding scale 

23 of bonus payments and additional in24 centives to medicare administrative 

25 contractors that reduce the improper 


jlentini on DSK4TPTVN1PROD with BILLS
51 

•S 1251 IS

1 payment error rates in their jurisdic2 tions to certain benchmark levels; and 

3 ‘‘(II) shall include penalties, in4 cluding substantial reductions in 

5 award fee payments under award fee 

6 contracts, for any medicare adminis7 trative contractor that reaches an 

8 upper end error threshold or other 

9 threshold as determined by the Sec10 retary.’’. 

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

12 this section shall apply to contracts entered into on or 

13 after the date that is 12 months after the date of enact14 ment of this Act and to current contracts through modi15 fication when practicable. 

16 SEC. 402. SEPARATING PROVIDER ENROLLMENT AND 

17 SCREENING FROM MEDICARE ADMINISTRA18 TIVE CONTRACTORS. 

19 (a) IN GENERAL.—Section 1866(j)(1) of the Social 

20 Security Act (42 U.S.C. 1395cc(j)(1)) is amended by add21 ing at the end the following new subparagraph: 

22 ‘‘(D) IMPLEMENTATION.—The enrollment 

23 process established under subparagraph (A) 

24 and the provider screening under paragraph (2) 

25 shall be carried out under one or more conVerDate Mar 15 2010 20:26 Jun 29, 2011 Jkt 099200 PO 00000 Frm 00051 Fmt 6652 Sfmt 6201 E:\BILLS\S1251.IS S1251

jlentini on DSK4TPTVN1PROD with BILLS
52 

•S 1251 IS

1 tracts with entities. Such contracts shall be sep2 arate from any contract to serve as a medicare 

3 administrative contractor under section 

4 1874A.’’. 

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

6 subsection (a) shall apply to contracts entered into on or 

7 after the date that is 24 months after the date of enact8 ment of this Act and to current contracts through modi9 fication when practicable. 

10 SEC. 403. DEVELOPING MEASURABLE PERFORMANCE 

11 METRICS FOR MEDICARE CONTRACTORS. 

12 (a) REPORT.—Not later than 12 months after the 

13 date of enactment of this Act, the Secretary of Health and 

14 Human Services (in this section referred to as the ‘‘Sec15 retary’’) shall submit to Congress a report containing 

16 measurable metrics for improving Medicare contractor 

17 performance, including Medicare administrative contrac18 tors under section 1874A of the Social Security Act (42 

19 U.S.C. 1395kk), program safeguard contractors and other 

20 similar contractors, Medicare Drug Integrity Contractors, 

21 qualified independent contractors with a contract under 

22 section 1869(c) of the Social Security Act (42 U.S.C. 

23 1395ff(c)), and other contractors that perform adminis24 trative or oversight functions under the Medicare program 


jlentini on DSK4TPTVN1PROD with BILLS
53 

•S 1251 IS

1 under title XVIII of the Social Security Act (42 U.S.C. 

2 1395 et seq.). 

3 (b) CONTENTS OF REPORT.—The report submitted 

4 under subsection (a) shall include the Secretary’s rec5 ommendations for the development of measurable per6 formance metrics for Medicare contractors (or updated 

7 and revised measurable performance metrics), together 

8 with recommendations for such legislation and administra9 tive action as the Secretary considers appropriate. 

10 (c) RELATIONSHIP TO GOVERNMENT PERFORMANCE

11 AND RESULTS ACT.—The metrics submitted in the report 

12 under subsection (a) may include performance goals or 

13 performance indicators established under the provisions of 

14 and amendments made by the GPRA Modernization Act 

15 of 2010 (Public Law 111–352). 

16 (d) REVIEW BY THE COMPTROLLER GENERAL.—Not 

17 later than 270 days after the date on which the report 

18 is submitted under subsection (a), the Comptroller Gen19 eral of the United States shall submit to Congress a report 

20 containing a review of the report submitted under such 

21 subsection. 


jlentini on DSK4TPTVN1PROD with BILLS
54 

•S 1251 IS

1 TITLE V—OTHER PROVISIONS 

2 SEC. 501. STRENGTHENING PENALTIES FOR THE ILLEGAL 

3 DISTRIBUTION OF A MEDICARE, MEDICAID, 

4 OR CHIP BENEFICIARY IDENTIFICATION OR 

5 BILLING PRIVILEGES. 

6 Section 1128B(b) of the Social Security Act (42 

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

8 following: 

9 ‘‘(4) Whoever knowingly, intentionally, and with 

10 the intent to defraud purchases, sells or distributes, 

11 or arranges for the purchase, sale, or distribution of 

12 a Medicare, Medicaid, or CHIP beneficiary identi13 fication number or billing privileges under title 

14 XVIII, title XIX, or title XXI, including a provider 

15 identifier, shall be imprisoned for not more than 10 

16 years or fined not more than $500,000 ($1,000,000 

17 in the case of a corporation), or both.’’. 

18 SEC. 502. PROVIDING IMPLEMENTATION FUNDING. 

19 (a) IN GENERAL.—For purposes of carrying out the 

20 provisions of and amendments made by this Act, in addi21 tion to funds otherwise available, there are appropriated 

22 to the Secretary of Health and Human Services for the 

23 Centers for Medicare & Medicaid Services Program Man24 agement Account, from amounts in the general fund of 

25 the Treasury not otherwise appropriated, $75,000,000 for 


jlentini on DSK4TPTVN1PROD with BILLS
55 

•S 1251 IS

1 the period of fiscal years 2012 through 2016. Amounts 

2 appropriated under the preceding sentence shall remain 

3 available until expended. 

4 (b) REVISION TO THE MEDICARE IMPROVEMENT

5 FUND.—Section 1898(b)(1)(B) of the Social Security Act 

6 (42 U.S.C. 1395iii(b)(1)(B)) is amended by striking 

7 ‘‘$275,000,000’’ and inserting ‘‘$200,000,000’’. 

Æ 


jlentini on DSK4TPTVN1PROD with BILLS