II

106TH CONGRESS

2D SESSION S. 2735

To promote access to health care services in rural areas.

IN THE SENATE OF THE UNITED STATES

JUNE 15, 2000

Mr. CONRAD (for himself, Mr. GRASSLEY, Mr. DASCHLE, Mr. BAUCUS, Mr.

KERREY, Mr. JEFFORDS, Mr. ROCKEFELLER, Mr. THOMAS, Mr. HARKIN,

Mr. ROBERTS, Mr. JOHNSON, Mr. COCHRAN, and Mrs. LINCOLN) introduced the following bill; which was read twice and referred to the Committee on Finance

A BILL

To promote access to health care services in rural areas.

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 ‘‘Health Care Access and Rural Equality Act of 2000’’.

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

7 this Act is as follows:

Sec. 1. Short title; table of contents.

TITLE I—INCREASE IN MARKET BASKET PERCENTAGE

ADJUSTMENT FOR RURAL HOSPITALS

Sec. 101. Increase in market basket percentage adjustment for rural hospitals.
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TITLE II—CAPITAL RELIEF FOR RURAL HEALTH CARE

INFRASTRUCTURE

Sec. 201. Capital infrastructure revolving loan program.

TITLE III—REFINEMENT OF THE MEDICARE DEPENDENT, SMALL

RURAL HOSPITAL PROGRAM

Sec. 301. Making the medicare dependent, small rural hospital program permanent.

Sec. 302. Option to base eligibility on discharges during any of the 3 most recent audited cost reporting periods.

TITLE IV—EXEMPTION FOR MEDICARE SWING BED HOSPITALS

Sec. 401. Exemption of medicare swing bed hospitals from the prospective payment system for skilled nursing facilities.

TITLE V—TREATMENT OF PHYSICIAN PATHOLOGY SERVICES

Sec. 501. Treatment of certain physician pathology services under medicare.

TITLE VI—TECHNICAL CORRECTIONS TO THE BALANCED

BUDGET REFINEMENT ACT

Sec. 601. Payments to critical access hospitals for clinical diagnostic laboratory

tests.

Sec. 602. All-inclusive payment option for outpatient critical access hospital

services.

Sec. 603. Extension of option to use rebased target amounts to all sole community hospitals.

Sec. 604. Grants for upgrading data systems.

1 TITLE I—INCREASE IN MARKET

2 BASKET PERCENTAGE AD3 JUSTMENT FOR RURAL HOS4 PITALS

5 SEC. 101. INCREASE IN MARKET BASKET PERCENTAGE AD6 JUSTMENT FOR RURAL HOSPITALS.

7 Section 1886(b)(3)(B)(i) of the Social Security Act

8 (42 U.S.C. 1395ww(b)(3)(B)(i)) (as amended by section

9 406 of the Medicare, Medicaid, and SCHIP Balanced

10 Budget Refinement Act of 1999 (113 Stat. 1501A–373),
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1 as enacted into law by section 1000(a)(6) of Public Law

2 106–113) is amended—

3 (1) in subclause (XVI)—

4 (A) by striking ‘‘(other than sole commu5 nity hospitals)’’ and inserting ‘‘(other than any

6 hospital that is located in a rural area and that

7 has less than 100 beds, is classified under sub8 section (d)(5)(C), or is a sole community hos9 pital (as defined in subsection (d)(5)(D)(iii)))’’;

10 and

11 (B) by striking ‘‘increase for sole commu12 nity hospitals’’ and inserting ‘‘increase for any

13 hospital that is located in a rural area and that

14 has less than 100 beds, is classified under sub15 section (d)(5)(C), or is a sole community hos16 pital (as defined in subsection (d)(5)(D)(iii))’’;

17 and

18 (2) in subclause (XVII)—

19 (A) by inserting ‘‘(other than any hospital

20 that is located in a rural area and that has less

21 than 100 beds, is classified under subsection

22 (d)(5)(C), or is a sole community hospital (as

23 defined in subsection (d)(5)(D)(iii)))’’ after ‘‘for

24 hospitals’’; and
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1 (B) by inserting ‘‘, and the market basket

2 percentage increase for any hospital that is lo3 cated in a rural area and that has less than

4 100 beds, is classified under subsection

5 (d)(5)(C), or is a sole community hospital (as

6 defined in subsection (d)(5)(D)(iii))’’ after ‘‘in

7 all areas’’.

8 TITLE II—CAPITAL RELIEF FOR

9 RURAL HEALTH CARE INFRA10 STRUCTURE

11 SEC. 201. CAPITAL INFRASTRUCTURE REVOLVING LOAN

12 PROGRAM.

13 (a) IN GENERAL.—Part A of title XVI of the Public

14 Health Service Act (42 U.S.C. 300q et seq.) is amended

15 by adding at the end the following new section:

16 ‘‘CAPITAL INFRASTRUCTURE REVOLVING LOAN PROGRAM

17 ‘‘SEC. 1603. (a) AUTHORITY TO MAKE AND GUAR18 ANTEE LOANS.—

19 ‘‘(1) AUTHORITY TO MAKE LOANS.—The Sec20 retary may make loans from the fund established

21 under section 1602(d) to any rural entity for

22 projects for capital improvements, including—

23 ‘‘(A) the acquisition of land necessary for

24 the capital improvements;
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1 ‘‘(B) the renovation or modernization of

2 any building;

3 ‘‘(C) the acquisition or repair of fixed or

4 major movable equipment; and

5 ‘‘(D) such other project expenses as the

6 Secretary determines appropriate.

7 ‘‘(2) AUTHORITY TO GUARANTEE LOANS.—

8 ‘‘(A) IN GENERAL.—The Secretary may

9 guarantee the payment of principal and interest

10 for loans to rural entities for projects for cap11 ital improvements described in paragraph (1) to

12 non-Federal lenders.

13 ‘‘(B) INTEREST SUBSIDIES.—In the case

14 of a guarantee of any loan to a rural entity

15 under subparagraph (A)(i), the Secretary may

16 pay to the holder of such loan and for and on

17 behalf of the project for which the loan was

18 made, amounts sufficient to reduce by not more

19 than 3 percent of the net effective interest rate

20 otherwise payable on such loan.

21 ‘‘(b) AMOUNT OF LOAN.—The principal amount of

22 a loan directly made or guaranteed under subsection (a)

23 for a project for capital improvement may not exceed

24 $5,000,000.

25 ‘‘(c) FUNDING LIMITATIONS.—
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1 ‘‘(1) GOVERNMENT CREDIT SUBSIDY EXPO2 SURE.—The total of the Government credit subsidy

3 exposure under the Credit Reform Act of 1990 scor4 ing protocol with respect to the loans outstanding at

5 any time with respect to which guarantees have been

6 issued, or which have been directly made, under sub7 section (a) may not exceed $50,000,000 per year.

8 ‘‘(2) TOTAL AMOUNTS.—Subject to paragraph

9 (1), the total of the principal amount of all loans di10 rectly made or guaranteed under subsection (a) may

11 not exceed $250,000,000 per year.

12 ‘‘(d) ADDITIONAL ASSISTANCE.—

13 ‘‘(1) NONREPAYABLE GRANTS.—Subject to

14 paragraph (2), the Secretary may make a grant to

15 a rural entity, in an amount not to exceed $50,000,

16 for purposes of capital assessment and business

17 planning.

18 ‘‘(2) LIMITATION.—The cumulative total of

19 grants awarded under this subsection may not ex20 ceed $2,500,000 per year.

21 ‘‘(e) TERMINATION OF AUTHORITY.—The Secretary

22 may not directly make or guarantee any loan under sub23 section (a) or make a grant under subsection (d) after

24 September 30, 2005.’’.
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1 (b) RURAL ENTITY DEFINED.—Section 1624 of the

2 Public Health Service Act (42 U.S.C. 300s–3) is amended

3 by adding at the end the following new paragraph:

4 ‘‘(15)(A) The term ‘rural entity’ includes—

5 ‘‘(i) a rural health clinic, as defined in sec6 tion 1861(aa)(2) of the Social Security Act;

7 ‘‘(ii) any medical facility with at least 1,

8 but less than 50 beds that is located in—

9 ‘‘(I) a county that is not part of a

10 metropolitan statistical area; or

11 ‘‘(II) a rural census tract of a metro12 politan statistical area (as determined

13 under the most recent modification of the

14 Goldsmith Modification, originally pub15 lished in the Federal Register on February

16 27, 1992 (57 Fed. Reg. 6725));

17 ‘‘(iii) a hospital that is classified as a

18 rural, regional, or national referral center under

19 section 1886(d)(5)(C) of the Social Security

20 Act; and

21 ‘‘(iv) a hospital that is a sole community

22 hospital (as defined in section

23 1886(d)(5)(D)(iii) of the Social Security Act).

24 ‘‘(B) For purposes of subparagraph (A), the

25 fact that a clinic, facility, or hospital has been geo-
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1 graphically reclassified under the medicare program

2 under title XVIII of the Social Security Act shall not

3 preclude a hospital from being considered a rural en4 tity under clause (i) or (ii) of subparagraph (A).’’.

5 (c) CONFORMING AMENDMENTS.—Section 1602 of

6 the Public Health Service Act (42 U.S.C. 300q–2) is

7 amended—

8 (1) in subsection (b)(2)(D), by inserting ‘‘or

9 1603(a)(2)(B)’’ after ‘‘1601(a)(2)(B)’’; and

10 (2) in subsection (d)—

11 (A) in paragraph (1)(C), by striking ‘‘sec12 tion 1601(a)(2)(B)’’ and inserting ‘‘sections

13 1601(a)(2)(B) and 1603(a)(2)(B)’’; and

14 (B) in paragraph (2)(A), by inserting ‘‘or

15 1603(a)(2)(B)’’ after ‘‘1601(a)(2)(B)’’.

16 TITLE III—REFINEMENT OF THE

17 MEDICARE DEPENDENT,

18 SMALL RURAL HOSPITAL

19 PROGRAM

20 SEC. 301. MAKING THE MEDICARE DEPENDENT, SMALL

21 RURAL HOSPITAL PROGRAM PERMANENT.

22 (a) PAYMENT METHODOLOGY.—Section

23 1886(d)(5)(G) of the Social Security Act (42 U.S.C.

24 1395ww(d)(5)(G)) (as amended by section 404(a) of the

25 Medicare, Medicaid, and SCHIP Balanced Budget Refine-
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1 ment Act of 1999 (113 Stat. 1501A–372), as enacted into

2 law by section 1000(a)(6) of Public Law 106–113) is

3 amended—

4 (1) in clause (i), by striking ‘‘and before Octo5 ber 1, 2006,’’; and

6 (2) in clause (ii)(II), by striking ‘‘and before

7 October 1, 2006,’’.

8 (b) CONFORMING AMENDMENTS.—

9 (1) TARGET AMOUNT.—Section 1886(b)(3)(D)

10 of the Social Security Act (42 U.S.C.

11 1395ww(b)(3)(D)) (as amended by section 404(b)(1)

12 of the Medicare, Medicaid, and SCHIP Balanced

13 Budget Refinement Act of 1999 (113 Stat. 1501A–

14 372), as enacted into law by section 1000(a)(6) of

15 Public Law 106–113) is amended—

16 (A) in the matter preceding clause (i), by

17 striking ‘‘and before October 1, 2006,’’; and

18 (B) in clause (iv), by striking ‘‘through fis19 cal year 2005,’’ and inserting ‘‘or any subse20 quent fiscal year,’’.

21 (2) PERMITTING HOSPITALS TO DECLINE RE22 CLASSIFICATION.—Section 13501(e)(2) of the Omni23 bus Budget Reconciliation Act of 1993 (42 U.S.C.

24 1395ww note) (as amended by section 404(b)(2) of

25 the Medicare, Medicaid, and SCHIP Balanced
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1 Budget Refinement Act of 1999 (113 Stat. 1501A–

2 372), as enacted into law by section 1000(a)(6) of

3 Public Law 106–113) is amended by striking ‘‘or

4 fiscal year 2000 through fiscal year 2005’’ and in5 serting ‘‘fiscal year 2000, or any subsequent fiscal

6 year,’’.

7 SEC. 302. OPTION TO BASE ELIGIBILITY ON DISCHARGES

8 DURING ANY OF THE 3 MOST RECENT AU9 DITED COST REPORTING PERIODS.

10 (a) OPTION TO BASE ELIGIBILITY ON DISCHARGES

11 DURING ANY OF THE 3 MOST RECENT AUDITED COST

12 REPORTING PERIODS.—Section 1886(d)(5)(G)(iv)(IV) of

13 the Social Security Act (42 U.S.C.

14 1395ww(d)(5)(G)(iv)(IV)) is amended by inserting ‘‘, or

15 any of the 3 most recent audited cost reporting periods,’’

16 after ‘‘1987’’.

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

18 this section shall apply with respect to cost reporting peri19 ods beginning on or after the date of enactment of this

20 Act.
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1 TITLE IV—EXEMPTION FOR

2 MEDICARE SWING BED HOS3 PITALS

4 SEC. 401. EXEMPTION OF MEDICARE SWING BED HOS5 PITALS FROM THE PROSPECTIVE PAYMENT

6 SYSTEM FOR SKILLED NURSING FACILITIES.

7 (a) EXEMPTION FOR MEDICARE SWING BED HOS8 PITALS.—

9 (1) IN GENERAL.—Section 1888(e)(7) of the

10 Social Security Act (42 U.S.C. 1395yy(e)(7)(A)) is

11 amended—

12 (A) in the heading, by striking ‘‘TRANSI13 TION’’ and inserting ‘‘EXEMPTION’’;

14 (B) by striking subparagraph (A) and in15 serting the following new subparagraph:

16 ‘‘(A) IN GENERAL.—The prospective pay17 ment system under this subsection shall not

18 apply to items and services provided by a facil19 ity described in subparagraph (B).’’; and

20 (C) in subparagraph (B), by striking ‘‘, for

21 which payment’’ and all that follows before the

22 period.

23 (2) EFFECTIVE DATE.—The amendments made

24 by paragraph (1) shall take effect as if included in

25 the enactment of section 4432 of the Balanced
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1 Budget Act of 1997 (Public Law 105–133; 111

2 Stat. 414).

3 (b) CHANGE IN EFFECTIVE DATE OF BBRA AMEND4 MENTS.—

5 (1) IN GENERAL.—Section 408(c) of the Medi6 care, Medicaid, and SCHIP Balanced Budget Re7 finement Act of 1999 (113 Stat. 1501A–375), as en8 acted into law by section 1000(a)(6) of Public Law

9 106–113, is amended by striking ‘‘the date that is’’

10 and all that follows before the period at the end and

11 inserting ‘‘January 1, 2001’’.

12 (2) EFFECTIVE DATE.—The amendment made

13 by paragraph (1) shall take effect as if included in

14 the enactment of section 408 of the Medicare, Med15 icaid, and SCHIP Balanced Budget Refinement Act

16 of 1999 (113 Stat. 1501A–375), as enacted into law

17 by section 1000(a)(6) of Public Law 106–113.

18 TITLE V—TREATMENT OF PHYSI19 CIAN PATHOLOGY SERVICES

20 SEC. 501. TREATMENT OF CERTAIN PHYSICIAN PATHOLOGY

21 SERVICES UNDER MEDICARE.

22 (a) IN GENERAL.—Notwithstanding any other provi23 sion of law, when an independent laboratory, under a

24 grandfathered arrangement with a hospital, furnishes the

25 technical component of a physician pathology service with
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1 respect to a fee-for-service medicare beneficiary who is an

2 inpatient of the hospital, such component shall be treated

3 as a service for which payment shall be made to the lab4 oratory under section 1848 of the Social Security Act (42

5 U.S.C. 1395w–4) and not as an inpatient hospital service

6 for which payment is made to the hospital under section

7 1886(d) of such Act (42 U.S.C. 1395ww(d)).

8 (b) DEFINITIONS.—For purposes of this section—

9 (1) the term ‘‘grandfathered arrangement’’

10 means an arrangement between an independent lab11 oratory and a hospital—

12 (A) that was in effect as of July 22, 1999,

13 even if such arrangement is subsequently re14 newed; and

15 (B) under which the laboratory furnishes

16 the technical component of physician pathology

17 services with respect to hospital inpatients and

18 submits a claim for payment for such compo19 nent to a medicare carrier (and not to the hos20 pital);

21 (2) the term ‘‘fee-for-service medicare bene22 ficiary’’ means an individual who—

23 (A) is entitled to benefits under part A of

24 title XVIII of the Social Security Act (42

25 U.S.C. 1395c et seq.); and
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1 (B) is not enrolled in a Medicare+Choice

2 plan under part C of such Act (42 U.S.C.

3 1395w–21 et seq.), a plan offered by an eligible

4 organization under section 1876 of such Act

5 (42 U.S.C. 1395mm), or a medicare managed

6 care demonstration project; and

7 (3) the term ‘‘medicare carrier’’ means an orga8 nization with a contract under section 1842 of such

9 Act (42 U.S.C. 1395u).

10 (c) EFFECTIVE DATE.—This section shall apply to

11 services furnished on or after July 22, 1999.

12 TITLE VI—TECHNICAL CORREC13 TIONS TO THE BALANCED

14 BUDGET REFINEMENT ACT

15 SEC. 601. PAYMENTS TO CRITICAL ACCESS HOSPITALS FOR

16 CLINICAL DIAGNOSTIC LABORATORY TESTS.

17 (a) PAYMENT ON COST BASIS WITHOUT BENE18 FICIARY COST-SHARING.—

19 (1) IN GENERAL.—Section 1833(a)(6) of the

20 Social Security Act (42 U.S.C. 1395l(a)(6)) is

21 amended by inserting ‘‘(including clinical diagnostic

22 laboratory services furnished by a critical access hos23 pital)’’ after ‘‘outpatient critical access hospital serv24 ices’’.

25 (2) NO BENEFICIARY COST-SHARING.—
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1 (A) IN GENERAL.—Section 1834(g) of the

2 Social Security Act (42 U.S.C. 1395m(g)) is

3 amended by inserting ‘‘(except that in the case

4 of clinical diagnostic laboratory services fur5 nished by a critical access hospital the amount

6 of payment shall be equal to 100 percent of the

7 reasonable costs of the critical access hospital

8 in providing such services)’’ before the period

9 at the end.

10 (B) BBRA AMENDMENT.—Section 1834(g)

11 of the Social Security Act (42 U.S.C.

12 1395m(g)) (as amended by section 403(d) of

13 the Medicare, Medicaid, and SCHIP Balanced

14 Budget Refinement Act of 1999 (113 Stat.

15 1501A–371), as enacted into law by section

16 1000(a)(6) of Public Law 106–113) is

17 amended—

18 (i) in paragraph (1), by inserting

19 ‘‘(except that in the case of clinical diag20 nostic laboratory services furnished by a

21 critical access hospital the amount of pay22 ment shall be equal to 100 percent of the

23 reasonable costs of the critical access hos24 pital in providing such services)’’ after

25 ‘‘such services,’’; and
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1 (ii) in paragraph (2)(A), by inserting

2 ‘‘(except that in the case of clinical diag3 nostic laboratory services furnished by a

4 critical access hospital the amount of pay5 ment shall be equal to 100 percent of the

6 reasonable costs of the critical access hos7 pital in providing such services)’’ before

8 the period at the end.

9 (b) CONFORMING AMENDMENTS.—Paragraphs

10 (1)(D)(i) and (2)(D)(i) of section 1833(a) of the Social

11 Security Act (42 U.S.C. 1395l(a)(1)(D)(i);

12 1395l(a)(2)(D)(i)) (as amended by section 403(e) of the

13 Medicare, Medicaid, and SCHIP Balanced Budget Refine14 ment Act of 1999 (113 Stat. 1501A–371), as enacted into

15 law by section 1000(a)(6) of Public Law 106–113) are

16 each amended by striking ‘‘or which are furnished on an

17 outpatient basis by a critical access hospital’’.

18 (c) TECHNICAL AMENDMENT.—Section 403(d)(2) of

19 the Medicare, Medicaid, and SCHIP Balanced Budget Re20 finement Act of 1999 (113 Stat. 1501A–371), as enacted

21 into law by section 1000(a)(6) of Public Law 106–113,

22 is amended by striking ‘‘subsection (a)’’ and inserting

23 ‘‘paragraph (1)’’.

24 (d) EFFECTIVE DATES.—
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1 (1) IN GENERAL.—Except as provided in para2 graph (2), the amendments made by this section

3 shall apply to services furnished on or after Novem4 ber 29, 1999.

5 (2) BBRA AND TECHNICAL AMENDMENTS.—

6 The amendments made by subsections (a)(2)(B) and

7 (c) shall take effect as if included in the enactment

8 of section 403(d) of the Medicare, Medicaid, and

9 SCHIP Balanced Budget Refinement Act of 1999

10 (113 Stat. 1501A–371), as enacted into law by sec11 tion 1000(a)(6) of Public Law 106–113.

12 SEC. 602. ALL-INCLUSIVE PAYMENT OPTION FOR OUT13 PATIENT CRITICAL ACCESS HOSPITAL SERV14 ICES.

15 (a) ALL-INCLUSIVE PAYMENT OPTION FOR OUT16 PATIENT CRITICAL ACCESS HOSPITAL SERVICES.—Sec17 tion 1834(g) (42 U.S.C. 1395m(g)) (as amended by sec18 tion 601 of this Act and section 403(d) of the Medicare,

19 Medicaid, and SCHIP Balanced Budget Refinement Act

20 of 1999 (113 Stat. 1501A–371), as enacted into law by

21 section 1000(a)(6) of Public Law 106–113) is amended—

22 (1) by striking paragraph (1) and inserting the

23 following new paragraph:

24 ‘‘(1) ELECTION OF CAH.—At the election of a

25 critical access hospital, the amount of payment for
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1 outpatient critical access hospital services under this

2 part shall be determined under paragraph (2) or (3),

3 such amount determined under either paragraph

4 without regard to the amount of the customary or

5 other charge.’’; and

6 (2) by striking paragraph (3) and inserting the

7 following new paragraph:

8 ‘‘(3) ALL-INCLUSIVE RATE.—If a critical access

9 hospital elects this paragraph to apply, with respect

10 to both facility services and professional services,

11 there shall be paid amounts equal to the reasonable

12 costs of the critical access hospital in providing such

13 services (except that in the case of clinical diagnostic

14 laboratory services furnished by a critical access hos15 pital the amount of payment shall be equal to 100

16 percent of the reasonable costs of the critical access

17 hospital in providing such services), less the amount

18 that such hospital may charge as described in sec19 tion 1866(a)(2)(A).’’.

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

21 subparagraph (a) shall take effect as if included in the

22 enactment of section 403(d) of the Medicare, Medicaid,

23 and SCHIP Balanced Budget Refinement Act of 1999

24 (113 Stat. 1501A–371), as enacted into law by section

25 1000(a)(6) of Public Law 106–113.
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1 SEC. 603. EXTENSION OF OPTION TO USE REBASED TARGET

2 AMOUNTS TO ALL SOLE COMMUNITY HOS3 PITALS.

4 (a) IN GENERAL.—Section 1886(b)(3)(I)(i) of the

5 Social Security Act (42 U.S.C. 1395ww(b)(3)(I)(i)) (as

6 added by section 405 of the Medicare, Medicaid, and

7 SCHIP Balanced Budget Refinement Act of 1999 (113

8 Stat. 1501A–372), as enacted into law by section

9 1000(a)(6) of Public Law 106–113) is amended—

10 (1) in the matter preceding subclause (I)—

11 (A) by striking ‘‘for its cost reporting pe12 riod beginning during 1999 is paid on the basis

13 of the target amount applicable to the hospital

14 under subparagraph (C) and that’’; and

15 (B) by striking ‘‘such target amount’’ and

16 inserting ‘‘the amount otherwise determined

17 under subsection (d)(5)(D)(i)’’;

18 (2) in subclause (I), by striking ‘‘target amount

19 otherwise applicable’’ and all that follows through

20 ‘‘target amount’)’’ and inserting ‘‘the amount other21 wise applicable to the hospital under subsection

22 (d)(5)(D)(i) (referred to in this clause as the ‘sub23 section (d)(5)(D)(i) amount’)’’; and

24 (3) in each of subclauses (II) and (III), by

25 striking ‘‘subparagraph (C) target amount’’ and in26 serting ‘‘subsection (d)(5)(D)(i) amount’’.
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1 (b) EFFECTIVE DATE.—The amendments made by

2 this section shall take effect as if included in the enact3 ment of the Medicare, Medicaid, and SCHIP Balanced

4 Budget Refinement Act of 1999, as enacted into law by

5 section 1000(a)(6) of Public Law 106–113.

6 SEC. 604. GRANTS FOR UPGRADING DATA SYSTEMS.

7 (a) IN GENERAL.—Part B of title XVI of the Public

8 Health Service Act (42 U.S.C. 300r et seq.) is amended

9 by adding at the end the following new section:

10 ‘‘GRANTS FOR UPGRADING DATA SYSTEMS

11 ‘‘SEC. 1611. (a) GRANTS TO HOSPITALS.—The Sec12 retary may make grants to hospitals that have submitted

13 applications in accordance with subsection (c) to assist eli14 gible small rural hospitals in meeting the costs of estab15 lishing data systems required to meet requirements estab16 lished under the medicare program pursuant to amend17 ments made by the Balanced Budget Act of 1997 and the

18 Health Insurance Portability and Accountability Act of

19 1996.

20 ‘‘(b) ELIGIBLE SMALL RURAL HOSPITAL DE21 FINED.—For purposes of this section, the term ‘eligible

22 small rural hospital’ means a non-Federal, short-term gen23 eral acute care hospital that—
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1 ‘‘(1) is located in a rural area, as defined for

2 purposes of section 1886(d) of the Social Security

3 Act; and

4 ‘‘(2) has less than 50 beds.

5 ‘‘(c) APPLICATION.—A hospital seeking a grant

6 under this section shall submit an application to the Sec7 retary on or before such date and in such form and man8 ner as the Secretary specifies.

9 ‘‘(d) AMOUNT OF GRANT.—A grant to a hospital

10 under this section may not exceed $50,000.

11 ‘‘(e) USE OF FUNDS.—A hospital receiving a grant

12 under this section may use the funds for the purchase of

13 computer software and hardware, the education and train14 ing of hospital staff on computer information systems, the

15 expenses related to the administrative simplification re16 quirements under part C of title XI of the Social Security

17 Act, and to offset costs related to the implementation of

18 prospective payment systems under title XVIII of such

19 Act.

20 ‘‘(f) REPORTS.—

21 ‘‘(1) INFORMATION.—A hospital receiving a

22 grant under this section shall furnish the Secretary

23 with such information as the Secretary may require

24 to evaluate the project for which the grant is made
22

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1 and to ensure that the grant is expended for the

2 purposes for which it is made.

3 ‘‘(2) TIMING OF SUBMISSION.—

4 ‘‘(A) INTERIM REPORTS.—The Secretary

5 shall report to the Committee on Commerce of

6 the House of Representatives and the Com7 mittee on Health, Education, Labor, and Pen8 sions of the Senate at least annually on the

9 grant program established under this section,

10 including in such report information on the

11 number of grants made, the nature of the

12 projects involved, the geographic distribution of

13 grant recipients, and such other matters as the

14 Secretary deems appropriate.

15 ‘‘(B) FINAL REPORT.—The Secretary shall

16 submit a final report to such committees not

17 later than 180 days after the completion of all

18 of the projects for which a grant is made under

19 this section.

20 ‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There

21 are authorized to be appropriated such sums as may be

22 necessary for grants under this section.’’.

23 (b) CONFORMING AMENDMENT.—Section 1820(g)(3)

24 of the Social Security Act (42 U.S.C. 1395i–4(g)(3)) (as

25 added by section 409 of the Medicare, Medicaid, and
23

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1 SCHIP Balanced Budget Refinement Act of 1999 (113

2 Stat. 1501A–375), as enacted into law by section

3 1000(a)(6) of Public Law 106–113) is repealed.

Æ