I 

111TH CONGRESS 

1ST SESSION H. R. 4390 

To amend title XI of the Social Security Act to provide for enhanced program 

and provider protections under the Medicare, Medicaid, and Children’s 

Health Insurance programs. 

IN THE HOUSE OF REPRESENTATIVES 

DECEMBER 16, 2009 

Mr. MURPHY of New York introduced the following bill; which was referred 

to the Committee on Energy and Commerce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined 

by the Speaker, in each case for consideration of such provisions as fall 

within the jurisdiction of the committee concerned 

A BILL 

To amend title XI of the Social Security Act to provide 

for enhanced program and provider protections under 

the Medicare, Medicaid, and Children’s Health Insurance 

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. 

4 This Act may be cited as the ‘‘Medicare and Medicaid 

5 Fraud Prevention and Control Act of 2009’’. 


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1 SEC. 2. ENHANCED CMS PROGRAM PROTECTION AUTHOR2 ITY. 

3 (a) IN GENERAL.—Title XI of the Social Security Act 

4 (42 U.S.C. 1301 et seq.) is amended by inserting after 

5 section 1128F the following new section: 

6 ‘‘SEC. 1128G. ENHANCED PROGRAM AND PROVIDER PRO7 TECTIONS IN THE MEDICARE, MEDICAID, AND 

8 CHIP PROGRAMS. 

9 ‘‘(a) CERTAIN AUTHORIZED SCREENING, ENHANCED

10 OVERSIGHT PERIODS, ENROLLMENT MORATORIA, AND

11 PERIODIC VALIDATIONS.— 

12 ‘‘(1) AUTHORIZATION.— 

13 ‘‘(A) IN GENERAL.—In which the Sec14 retary has determined that there is a significant 

15 risk of fraudulent activity (as determined by the 

16 Secretary based on relevant complaints, reports, 

17 referrals by law enforcement or other sources, 

18 data analysis, trending information, or claims 

19 submissions by providers of services and sup20 pliers) with respect to a category of provider of 

21 services or supplier of items or services, which 

22 may be a category within a geographic area, 

23 under title XVIII, XIX, or XXI, the Secretary 

24 may impose, subject to subparagraph (B), with 

25 respect to a program under title XVIII, XIX, or 

26 XXI, the Secretary impose any of the following 


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1 requirements with respect to a provider of serv2 ices or a supplier (whether such provider or 

3 supplier is initially enrolling in the program or 

4 is renewing such enrollment): 

5 ‘‘(i) Screening under paragraph (2). 

6 ‘‘(ii) Enhanced oversight periods 

7 under paragraph (3). 

8 ‘‘(iii) Enrollment moratoria under 

9 paragraph (4). 

10 ‘‘(iv) Periodic validations of authoriza11 tions under paragraph (5). 

12 ‘‘(B) STATE REQUIREMENT.—In applying 

13 this subsection for purposes of title XIX and 

14 XXI, the Secretary may require a State to 

15 carry out the provisions of this subsection (and 

16 subsection (b)) as a requirement of the State 

17 plan under title XIX or the child health plan 

18 under title XXI. Actions taken and determina19 tions made under this subsection and subsection 

20 (b) shall not be subject to review by a judicial 

21 tribunal. 

22 ‘‘(2) SCREENING.—For purposes of paragraph 

23 (1), the Secretary shall establish procedures under 

24 which screening is conducted with respect to proVerDate Nov 24 2008 02:09 Dec 19, 2009 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H4390.IH H4390

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1 viders of services and suppliers described in such 

2 paragraph. Such screening may include at least— 

3 ‘‘(A) licensing board checks; 

4 ‘‘(B) screening against the list of individ5 uals and entities excluded from the program 

6 under title XVIII, XIX, or XXI; 

7 ‘‘(C) the excluded provider list system; 

8 ‘‘(D) background checks; 

9 ‘‘(E) unannounced pre-enrollment or other 

10 site visits; and 

11 ‘‘(F) heightened disclosure of affiliations. 

12 ‘‘(3) ENHANCED OVERSIGHT PERIOD.—For 

13 purposes of paragraph (1), the Secretary shall estab14 lish procedures to provide for a period of not less 

15 than 30 days and not more than 365 days during 

16 which providers of services and suppliers described 

17 in such paragraph, as the Secretary determines ap18 propriate, would be subject to enhanced oversight, 

19 such as required or unannounced (or required and 

20 unannounced) site visits or inspections, prepayment 

21 review, enhanced review of claims, and such other 

22 actions as specified by the Secretary, under the pro23 grams under titles XVIII, XIX, and XXI. Under 

24 such procedures, the Secretary may extend such pe25 riod for more than 365 days if the Secretary deterVerDate Nov 24 2008 02:09 Dec 19, 2009 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H4390.IH H4390

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1 mines that after the initial period such additional 

2 period of oversight is necessary. 

3 ‘‘(4) ENHANCED OVERSIGHT FOR CLAIMS OF

4 DME SUPPLIERS.—If the Secretary determines under 

5 paragraph (1) that there is a significant risk of 

6 fraudulent activity among suppliers of durable med7 ical equipment, in the case of a supplier of durable 

8 medical equipment who is within a category or geo9 graphic area under title XVIII identified pursuant to 

10 such determination, whether at the time of initial 

11 enrollment under such title or otherwise, the Sec12 retary shall, notwithstanding section 1842(c)(2), 

13 withhold payment under such title with respect to 

14 durable medical equipment furnished by such sup15 plier during a period specified by the Secretary. 

16 ‘‘(5) PERIODIC REVIEW OF PHYSICIAN AUTHOR17 IZATIONS.—For purposes of paragraph (1), the Sec18 retary shall establish a program under which, in 

19 cases in which the Secretary (or an administrative 

20 contractor) determines under a program described in 

21 paragraph (1) that there may have been a pattern 

22 of excessive prescribing or authorization of items or 

23 services by a physician or other health care profes24 sional— 


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1 ‘‘(A) the Secretary (or contractor) submits 

2 to the physician or professional on a quarterly 

3 basis a list of the claims submitted under the 

4 program based on a prescription or authoriza5 tion by the physician or professional; and 

6 ‘‘(B) if the physician or professional does 

7 not validate by the end of the 90-day period be8 ginning on the date of receipt of the list the le9 gitimacy of the previously identified claims for 

10 items and services prescribed or authorized by 

11 the physician or professional, claims relating to 

12 such items and services prescribed or author13 ized by such physician or professional for subse14 quent periods shall be denied until such valida15 tion is made. 

16 ‘‘(6) MORATORIUM ON ENROLLMENT OF PRO17 VIDERS AND SUPPLIERS.—For purposes of para18 graph (1), the Secretary, based upon a finding of a 

19 risk of serious ongoing fraud within a program 

20 under title XVIII, XIX, or XXI, may impose a mor21 atorium on the enrollment of providers of services 

22 and suppliers within a category of providers of serv23 ices and suppliers (including a category within a spe24 cific geographic area) under such title. Such a mora25 torium may only be imposed if the Secretary makes 


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1 a determination that the moratorium would not ad2 versely impact access of individuals to care under 

3 such program. 

4 ‘‘(7) CLARIFICATION.—Nothing in this sub5 section shall be interpreted to preclude or limit the 

6 ability of a State to engage in provider screening or 

7 enhanced provider oversight activities beyond those 

8 required by the Secretary. 

9 ‘‘(b) PROBATIONARY PERIOD TO DETERMINE LEGIT10 IMACY OF NEW PROVIDERS AND SUPPLIERS.—The Sec11 retary shall establish procedures (without regard to sec12 tion 1874A(h)) under which at the time a provider or sup13 plier is first approved for participation in the program 

14 under title XVIII, XIX, or XXI, there shall be a proba15 tionary period of heightened review (specified by the Sec16 retary, but in no case longer than 1 year) under which— 

17 ‘‘(1) the Secretary (or an administrative con18 tractor) shall review a random or other appropriate 

19 sample of claims to determine the legitimacy of the 

20 operations of the provider or supplier; 

21 ‘‘(2) the Secretary (or such contractor) shall 

22 validate the legitimacy of physician prescriptions or 

23 other authorizations for the items and services fur24 nished by such provider or supplier; and 


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1 ‘‘(3) if the Secretary, on the basis of such a re2 view of such claims or such validation, makes a pre3 liminary finding that a significant or dispropor4 tionate number of such claims are not legitimate (as 

5 determined by the Secretary), the Secretary may 

6 suspend or terminate the participation of the pro7 vider or supplier with notice to the provider or sup8 plier. 

9 The provisions of subsections (c) through (g) of section 

10 1128 shall apply to a suspension or termination under 

11 paragraph (3) in the same manner as such provisions 

12 apply to an exclusion under subsection (a) or (b) of such 

13 section. In the case of a physician or other professional 

14 that fails to cooperate with the Secretary (or a contractor) 

15 in the validation of prescriptions or authorizations de16 scribed in paragraph (2), the Secretary may impose a civil 

17 monetary penalty of not to exceed $10,000 with respect 

18 to the validation of items and services furnished by any 

19 particular provider or supplier. The provisions of section 

20 1128A (other than subsections (a) and (b)) shall apply 

21 to a civil money penalty under the previous sentence in 

22 the same manner as such provisions apply to a penalty 

23 or proceeding under section 1128A(a).’’. 


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1 (b) REVISION OF PROMPT PAY PROVISIONS.—Sec2 tions 1816(c)(2) and 1842(c)(2) of such Act (42 U.S.C. 

3 1395h(c)(2), 1395u(c)(2)) are each amended— 

4 (1) in subparagraph (A), by striking ‘‘Each 

5 contract’’ and inserting ‘‘Subject to subparagraph 

6 (C), each contract’’; and 

7 (2) by adding at the end the following new sub8 paragraph: 

9 ‘‘(C) Subparagraph (A) shall not apply to claims of 

10 providers or suppliers in cases in which the Secretary iden11 tifies a pattern or practice of claim submission that appear 

12 to be suspicious or otherwise indicative of a higher likeli13 hood of being fraudulent.’’. 

14 (c) CONFORMING AMENDMENTS.— 

15 (1) MEDICAID.—Section 1902(a) of the Social 

16 Security Act (42 U.S.C. 1396a(a)) is amended— 

17 (A) in paragraph (23), by inserting before 

18 the semicolon at the end the following: ‘‘or by 

19 a person to whom or entity to which a morato20 rium under section 1128G(a)(4) is applied dur21 ing the period of such moratorium’’; 

22 (B) in paragraph (72); by striking at the 

23 end ‘‘and’’; 

24 (C) in paragraph (73), by striking the pe25 riod at the end and inserting ‘‘; and’’; and 


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1 (D) by adding after paragraph (73) the 

2 following new paragraph: 

3 ‘‘(74) provide that the State will enforce any 

4 determination made by the Secretary under sub5 section (a) (relating to a significant risk of fraudu6 lent activity with respect to a category of provider 

7 or supplier described in such subsection through use 

8 of the appropriate procedures described in such sub9 section) or subsection (b) section 1128G and that 

10 the State will carry out any activities as required by 

11 the Secretary for purposes of such subsection (a).’’. 

12 (2) CHIP.—Section 2102 of such Act (42 

13 U.S.C. 1397bb) is amended by adding at the end the 

14 following new subsection: 

15 ‘‘(d) PROGRAM INTEGRITY.—A State child health 

16 plan shall include a description of the procedures to be 

17 used by the State— 

18 ‘‘(1) to enforce any determination made by the 

19 Secretary under subsection (a) (relating to a signifi20 cant risk of fraudulent activity with respect to a cat21 egory of provider or supplier described in such sub22 section through use of the appropriate procedures 

23 described in such subsection) or subsection (b) sec24 tion 1128G; and 


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1 ‘‘(2) to carry out any activities as required by 

2 the Secretary for purposes of such subsection.’’. 

3 (3) MEDICARE.—Section 1866(j) of such Act 

4 (42 U.S.C. 1395cc(j)) is amended by adding at the 

5 end the following new paragraph: 

6 ‘‘(3) PROGRAM INTEGRITY.—The provisions of 

7 subsections (a) and (b) of section 1128G apply to 

8 enrollments and renewals of enrollments of providers 

9 of services and suppliers under this title.’’. 

10 (d) CONSULTATION WITH OIG.—In implementing 

11 the amendments made by this section and determining 

12 under paragraph (1) of section 1128G(a) of the Social Se13 curity Act, as inserted by subsection (a), that a provider, 

14 supplier, or type of service, for an area, is a significant 

15 risk of fraudulent activity, the Secretary of Health and 

16 Human Services shall consult with the Inspector General 

17 of the Department of Health and Human Services in order 

18 to identify classes of providers and suppliers or types of 

19 items and services, or such a type of provider, supplier, 

20 or service for a specific geographic area, as being particu21 larly subject to fraud or abuse under Medicare, Medicaid, 

22 or the State children’s health insurance program. 

23 (e) ADDITIONAL FUNDING.—There are authorized to 

24 be appropriated such sums as may be appropriate to carry 

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1 tion). Such sums shall be in addition to any amounts that 

2 may be available from the Health Care Fraud and Abuse 

3 Control Account under section 1817(k) of the Social Secu4 rity Act (42 U.S.C. 1395i(k)). 

5 (f) EFFECTIVE DATE; EXPEDITED IMPLEMENTA6 TION.— 

7 (1) EFFECTIVE DATE.—The amendments made 

8 by this section shall take effect upon the date of the 

9 enactment of this Act and section 1128G(b) of the 

10 Social Security Act shall apply to providers and sup11 pliers that are first approved for participation on 

12 and after the date that is 6 months after the date 

13 of the enactment of this Act. 

14 (2) EXPEDITED IMPLEMENTATION.—The Sec15 retary of Health and Human Services shall promul16 gate regulations not later than 6 months after the 

17 date of the enactment of this Act to carry out this 

18 section, which regulations shall be effective and final 

19 immediately on an interim basis as of the date of 

20 publication of the interim final regulation. With re21 spect to such an interim final regulation, the Sec22 retary shall provide for a period of public comments 

23 on such regulation after the date of publication. The 


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1 Secretary may change or revise such regulation after 

2 completion of the period of public comment. 

Æ 


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