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103D CONGRESS

1ST SESSION H. R. 1586

To amend title XVIII of the Social Security Act to eliminate the annual

cap on the amount of payment for outpatient physical therapy and

occupational therapy services under part B of the medicare program,

and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

APRIL 1, 1993

Mr. RICHARDSON introduced the following bill; which was referred jointly to

the Committees on Ways and Means and Energy and Commerce

A BILL

To amend title XVIII of the Social Security Act to eliminate

the annual cap on the amount of payment for outpatient

physical therapy and occupational therapy services under

part B of the medicare program, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,
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1 SECTION 1. ELIMINATION OF ANNUAL CAP ON AMOUNT OF

2 MEDICARE PAYMENT FOR OUTPATIENT

3 PHYSICAL THERAPY AND OCCUPATIONAL

4 THERAPY SERVICES.

5 (a) IN GENERAL.—Section 1833 of the Social Secu6 rity Act (42 U.S.C. 1395l) is amended by striking sub7 section (g).

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

9 subsection (a) shall apply to services furnished on or after

10 January 1, 1994.

11 SEC. 2. EXTRA-BILLING LIMITS.

12 (a) ENFORCEMENT AND UNIFORM APPLICATION.—

13 (1) ENFORCEMENT.—Paragraph (1) of section

14 1848(g) of the Social Security Act (42 U.S.C.

15 1395w–4(g)) is amended to read as follows:

16 ‘‘(1) LIMITATION ON ACTUAL CHARGES.—

17 ‘‘(A) IN GENERAL.—In the case of a

18 nonparticipating physician or nonparticipating

19 supplier or other person (as defined in section

20 1842(i)(2)) who does not accept payment on an

21 assignment-related basis with respect to a phy22 sician’s service furnished to an individual en23 rolled under this part, the following rules apply:

24 ‘‘(i) APPLICATION OF LIMITING

25 CHARGE.—No such physician, supplier, or

26 person may bill or collect an actual charge
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1 for the service in excess of the limiting

2 charge described in paragraph (2) for such

3 service.

4 ‘‘(ii) NO LIABILITY FOR EXCESS

5 CHARGES.—No person is liable for pay6 ment of any amounts billed for the service

7 in excess of such limiting charge.

8 ‘‘(iii) CORRECTION OF EXCESS

9 CHARGES.—If such a physician, supplier,

10 or other person bills, but does not collect,

11 an actual charge for a service in violation

12 of clause (i), the physician, supplier, or

13 other person shall reduce on a timely basis

14 the actual charge billed for the service to

15 an amount not to exceed the limiting

16 charge for the service.

17 ‘‘(iv) REFUND OF EXCESS COLLEC18 TIONS.—If such a physician, supplier, or

19 other person collects an actual charge for

20 a service in violation of clause (i), the phy21 sician, supplier, or other person shall pro22 vide on a timely basis a refund to the indi23 vidual charged in the amount by which the

24 amount collected exceeded the limiting

25 charge for the service. The amount of such
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1 a refund shall be reduced to the extent the

2 individual has an outstanding balance owed

3 by the individual to the physician, supplier,

4 or other person.

5 ‘‘(B) SANCTIONS.—If a physician, supplier,

6 or other person—

7 ‘‘(i) knowingly and willfully bills or

8 collects for services in violation of subpara9 graph (A)(i) on a repeated basis, or

10 ‘‘(ii) fails to comply with clause (iii)

11 or (iv) of subparagraph (A) on a timely

12 basis,

13 the Secretary may apply sanctions against the

14 physician, supplier, or other person in accord15 ance with paragraph (2) of section 1842(j). The

16 provisions of section 1842(j)(4) shall apply for

17 purposes of this paragraph except that any ref18 erence in such section to a physician is deemed

19 also to include a reference to a supplier or other

20 person under this subparagraph.

21 ‘‘(C) TIMELY BASIS.—For purposes of this

22 paragraph, the term ‘on a timely basis’, means

23 not later than 30 days after the date the physi24 cian, supplier, or other person is notified by the
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1 carrier under this part of a violation of the re2 quirements of subparagraph (A).’’.

3 (2) UNIFORM APPLICATION OF EXTRA-BILLING

4 LIMITS TO PHYSICIANS’ SERVICES.—

5 (A) IN GENERAL.—Section 1848(g)(2)(C)

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

7 4(g)(2)(C)) is amended by inserting ‘‘or for

8 nonparticipating suppliers or other persons’’

9 after ‘‘nonparticipating physicians’’.

10 (B) CONFORMING DEFINITION.—Section

11 1842(i)(2) of the Social Security Act (42

12 U.S.C. 1395u(i)(2)) is amended—

13 (i) by striking ‘‘, and the term’’ and

14 inserting ‘‘; the term’’, and

15 (ii) by inserting before the period at

16 the end the following: ‘‘; and the term

17 ‘nonparticipating supplier or other person’

18 means a supplier or other person (exclud19 ing a provider of services) that is not a

20 participating physician or supplier (as de21 fined in subsection (h)(1))’’.

22 (3) ADDITIONAL CONFORMING AMENDMENTS.—

23 Section 1848 of the Social Security Act (42 U.S.C.

24 1395w–4) is amended—

25 (A) in subsection (a)(3)—
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1 (i) by inserting ‘‘AND SUPPLIERS’’

2 after ‘‘PHYSICIANS’’,

3 (ii) by inserting ‘‘or a

4 nonparticipating supplier or other person

5 (as defined in section 1842(i)(2))’’ after

6 ‘‘nonparticipating physician’’, and

7 (iii) by adding at the end the follow8 ing: ‘‘In the case of physicians’ services

9 (including services which the Secretary ex10 cludes pursuant to subsection (j)(3)) of a

11 nonparticipating physician, supplier, or

12 other person for which payment is made

13 under this part on a basis other than the

14 fee schedule amount, the payment shall be

15 based on 95 percent of the payment basis

16 for services of such type which are fur17 nished by a participating physician, sup18 plier, or other person.’’;

19 (B) in subsection (g)(1)(A), as amended by

20 subsection (a), in the matter before clause (i),

21 by inserting ‘‘(including services which the Sec22 retary excludes pursuant to subsection (j)(3))’’

23 after ‘‘a physician’s service’’;

24 (C) in subsection (g)(2)(D), by inserting

25 ‘‘(or, if payment under this part is made on a
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1 basis other than the fee schedule under this sec2 tion, 95 percent of the other payment basis)’’

3 after ‘‘subsection (a)’’;

4 (D) in subsection (g)(3)(B)—

5 (i) by inserting after the first sentence

6 the following: ‘‘No person is liable for pay7 ment of any amounts billed for such a

8 service in violation of the previous sen9 tence.’’, and

10 (ii) in the last sentence, by striking

11 ‘‘previous sentence’’ and inserting ‘‘first

12 sentence’’; and

13 (E) in subsection (h)—

14 (i) by inserting ‘‘or nonparticipating

15 supplier or other person’’ after ‘‘physician’’

16 the first place it appears,

17 (ii) by inserting ‘‘, supplier, or other

18 person’’ after ‘‘physician’’ the second place

19 it appears, and

20 (iii) by inserting ‘‘, suppliers, and

21 other persons’’ after ‘‘physicians’’ the sec22 ond place it appears.

23 (b) INFORMATION ON EXTRA-BILLING LIMITS.—
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1 (1) PART OF EXPLANATION OF MEDICARE BEN2 EFITS.—Section 1842(h)(7) of the Social Security

3 Act (42 U.S.C. 1395u(h)(7)) is amended—

4 (A) by striking ‘‘and’’ at the end of sub5 paragraph (B);

6 (B) in subparagraph (C), by striking ‘‘shall

7 include’’ and by striking the period at the end

8 and inserting ‘‘, and’’; and

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

10 subparagraph:

11 ‘‘(D) in the case of services for which the billed

12 amount exceeds the limiting charge imposed under

13 section 1848(g), information regarding such limiting

14 charge (including information concerning the right

15 to a refund under section 1848(g)(1)(A)(iv)).’’.

16 (2) DETERMINATIONS BY CARRIERS.—Subpara17 graph (G) of section 1842(b)(3) of the Social Secu18 rity Act (42 U.S.C. 1395u(b)(3)) is amended to read

19 as follows:

20 ‘‘(G) for a service that is furnished with respect

21 to an individual enrolled under this part, that is not

22 paid on an assignment-related basis, and that is sub23 ject to a limiting charge under section 1848(g),

24 will—
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1 ‘‘(i) determine, prior to making payment,

2 whether the amount billed for such service ex3 ceeds the limiting charge applicable under sec4 tion 1848(g)(2);

5 ‘‘(ii) notify the physician, supplier, or other

6 person periodically (but not less often than once

7 every 30 days) of determinations that amounts

8 billed exceeded such limiting charges; and

9 ‘‘(iii) provide for prompt response to in10 quiries of physicians, suppliers, and other per11 sons concerning the accuracy of such limiting

12 charges for their services;’’.

13 (c) REPORT ON CHARGES IN EXCESS OF LIMITING

14 CHARGE.—Section 1848(g)(6)(B) of the Social Security

15 Act (42 U.S.C. 1395w–4(g)(6)(B)) is amended by insert16 ing ‘‘on the extent to which actual charges exceed limiting

17 charges, the number and types of services involved, and

18 the average amount of excess charges and’’ after ‘‘report

19 to the Congress’’.

20 (d) EFFECTIVE DATES.—

21 (1) ENFORCEMENT AND UNIFORM APPLICA22 TION.—The amendments made by subsection (a)

23 shall apply to services furnished on or after Janu24 ary 1, 1994.
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1 (2) EXPLANATIONS.—The amendments made

2 by subsection (b)(1) shall apply to explanations of

3 benefits provided on or after January 1, 1994, ex4 cept that the requirement for including information

5 concerning the right to a refund shall apply to expla6 nations of benefits provided on or after July 1,

7 1994.

8 (3) CARRIER DETERMINATIONS.—The amend9 ments made by subsection (b)(2) shall apply to con10 tracts as of January 1, 1994.

11 (4) REPORT.—The amendment made by sub12 section (c) shall apply to reports for years beginning

13 after 1994.

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