II 

109TH CONGRESS 

1ST SESSION S. 1733 

To establish pilot projects under the medicare program to provide incentives 

for home health agencies to utilize home monitoring and communications 

technologies. 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 20, 2005 

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

to the Committee on Finance 

A BILL 

To establish pilot projects under the medicare program to 

provide incentives for home health agencies to utilize 

home monitoring and communications technologies. 

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

3 SECTION 1. REMOTE MONITORING PILOT PROJECTS. 

4 (a) PILOT PROJECTS.— 

5 (1) IN GENERAL.—Not later than 9 months 

6 after the date of enactment of this Act, the Sec7 retary of Health and Human Services (in this sec8 tion referred to as the ‘‘Secretary’’) shall conduct 

9 pilot projects under title XVIII of the Social Secu-
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1 rity Act for the purpose of providing incentives to 

2 home health agencies to utilize home monitoring and 

3 communications technologies that— 

4 (A) enhance health outcomes for medicare 

5 beneficiaries; and 

6 (B) reduce expenditures under such title. 

7 (2) SITE REQUIREMENTS.— 

8 (A) URBAN AND RURAL.—The Secretary 

9 shall conduct the pilot projects under this sec10 tion in both urban and rural areas. 

11 (B) SITE IN A SMALL STATE.—The Sec12 retary shall conduct at least 1 of the pilot 

13 projects in a State with a population of less 

14 than 1,000,000. 

15 (3) DEFINITION OF HOME HEALTH AGENCY.— 

16 In this section, the term ‘‘home health agency’’ has 

17 the meaning given that term in section 1861(o) of 

18 the Social Security Act (42 U.S.C. 1395x(o)). 

19 (b) MEDICARE BENEFICIARIES WITHIN THE SCOPE

20 OF PROJECTS.—The Secretary shall specify the criteria 

21 for identifying those medicare beneficiaries who shall be 

22 considered within the scope of the pilot projects under this 

23 section for purposes of the application of subsection (c) 

24 and for the assessment of the effectiveness of the home 

25 health agency in achieving the objectives of this section. 
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1 Such criteria may provide for the inclusion in the projects 

2 of medicare beneficiaries who begin receiving home health 

3 services under title XVIII of the Social Security Act after 

4 the date of the implementation of the projects. 

5 (c) INCENTIVES.— 

6 (1) PERFORMANCE TARGETS.—The Secretary 

7 shall establish for each home health agency partici8 pating in a pilot project under this section a per9 formance target using one of the following meth10 odologies, as determined appropriate by the Sec11 retary: 

12 (A) ADJUSTED HISTORICAL PERFORMANCE

13 TARGET.—The Secretary shall establish for the 

14 agency— 

15 (i) a base expenditure amount equal 

16 to the average total payments made to the 

17 agency under parts A and B of title XVIII 

18 of the Social Security Act for medicare 

19 beneficiaries determined to be within the 

20 scope of the pilot project in a base period 

21 determined by the Secretary; and 

22 (ii) an annual per capita expenditure 

23 target for such beneficiaries, reflecting the 

24 base expenditure amount adjusted for risk 

25 and adjusted growth rates. 
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1 (B) COMPARATIVE PERFORMANCE TAR2 GET.—The Secretary shall establish for the 

3 agency a comparative performance target equal 

4 to the average total payments under such parts 

5 A and B during the pilot project for comparable 

6 individuals in the same geographic area that 

7 are not determined to be within the scope of the 

8 pilot project. 

9 (2) INCENTIVE.—Subject to paragraph (3), the 

10 Secretary shall pay to each participating home care 

11 agency an incentive payment for each year under the 

12 pilot project equal to a portion of the medicare sav13 ings realized for such year relative to the perform14 ance target under paragraph (1). 

15 (3) LIMITATION ON EXPENDITURES.—The Sec16 retary shall limit incentive payments under this sec17 tion in order to ensure that the aggregate expendi18 tures under title XVIII of the Social Security Act 

19 (including incentive payments under this subsection) 

20 do not exceed the amount that the Secretary esti21 mates would have been expended if the pilot projects 

22 under this section had not been implemented. 

23 (d) WAIVER AUTHORITY.—The Secretary may waive 

24 such provisions of titles XI and XVIII of the Social Secu-
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1 rity Act as the Secretary determines to be appropriate for 

2 the conduct of the pilot projects under this section. 

3 (e) REPORT TO CONGRESS.—Not later than 5 years 

4 after the date that the first pilot project under this section 

5 is implemented, the Secretary shall submit to Congress a 

6 report on the pilot projects. Such report shall contain a 

7 detailed description of issues related to the expansion of 

8 the projects under subsection (f) and recommendations for 

9 such legislation and administrative actions as the Sec10 retary considers appropriate. 

11 (f) EXPANSION.—If the Secretary determines that 

12 any of the pilot projects under this section enhance health 

13 outcomes for medicare beneficiaries and reduce expendi14 tures under title XVIII of the Social Security Act, the Sec15 retary may initiate comparable projects in additional 

16 areas. 

17 (g) INCENTIVE PAYMENTS HAVE NO EFFECT ON

18 OTHER MEDICARE PAYMENTS TO AGENCIES.—An incen19 tive payment under this section— 

20 (1) shall be in addition to the payments that a 

21 home health agency would otherwise receive under 

22 title XVIII of the Social Security Act for the provi23 sion of home health services; and 
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1 (2) shall have no effect on the amount of such 

2 payments. 

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