Calendar No. 578

103D CONGRESS

2D SESSION S. 2381

A BILL

To require the Secretary of Health and Human

guidance, and for other purposes.Services to provide health care fraud and abuse

AUGUST 18, 1994

Read the second time and placed on the calendar
II

Calendar No. 578

103D CONGRESS

2D SESSION S. 2381

To require the Secretary of Health and Human Services to provide health

care fraud and abuse guidance, and for other purposes.

IN THE SENATE OF THE UNITED STATES

AUGUST 11, 1994

Mr. COHEN introduced the following bill; which was read the first time

AUGUST 18, 1994

Read the second time and placed on the calendar

A BILL

To require the Secretary of Health and Human Services

to provide health care fraud and abuse guidance, 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,

3 SECTION 1. HEALTH CARE FRAUD AND ABUSE GUIDANCE.

4 (a) SOLICITATION AND PUBLICATION OF MODIFICA5 TIONS TO EXISTING SAFE HARBORS AND NEW SAFE

6 HARBORS.—

7 (1) IN GENERAL.—
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1 (A) SOLICITATION OF PROPOSALS FOR

2 SAFE HARBORS.—Not later than January 1,

3 1995, and not less than annually thereafter, the

4 Secretary of Health and Human Services (here5 after in this section referred to as the ‘‘Sec6 retary’’) shall publish a notice in the Federal

7 Register soliciting proposals, which will be ac8 cepted during a 60-day period, for—

9 (i) modifications to existing safe har10 bors issued pursuant to section 14(a) of

11 the Medicare and Medicaid Patient and

12 Program Protection Act of 1987 (42

13 U.S.C. 1320a–7b note);

14 (ii) additional safe harbors specifying

15 payment practices that shall not be treated

16 as a criminal offense under section

17 1128B(b) of the Social Security Act the

18 (42 U.S.C. 1320a–7b(b)) and shall not

19 serve as the basis for an exclusion under

20 section 1128(b)(7) of such Act (42 U.S.C.

21 1320a–7(b)(7));

22 (iii) interpretive rulings to be issued

23 pursuant to subsection (b); and

24 (iv) special fraud alerts to be issued

25 pursuant to subsection (c).
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1 (B) PUBLICATION OF PROPOSED MODI2 FICATIONS AND PROPOSED ADDITIONAL STATE

3 HARBORS.—After considering the proposals de4 scribed in clauses (i) and (ii) of subparagraph

5 (A), the Secretary, in consultation with the At6 torney General, shall publish in the Federal

7 Register proposed modifications to existing safe

8 harbors and proposed additional safe harbors, if

9 appropriate, with a 60-day comment period.

10 After considering any public comments received

11 during this period, the Secretary shall issue

12 final rules modifying the existing safe harbors

13 and establishing new safe harbors, as appro14 priate.

15 (C) REPORT.—The Inspector General of

16 the Department of Health and Human Services

17 (hereafter in this section referred to as the ‘‘In18 spector General’’) shall, in an annual report to

19 Congress or as part of the year-end semiannual

20 report required by section 5 of the Inspector

21 General Act of 1978 (5 U.S.C. App.), describe

22 the proposals received under clauses (i) and (ii)

23 of subparagraph (A) and explain which propos24 als were included in the publication described in

25 subparagraph (B), which proposals were not in-
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1 cluded in that publication, and the reasons for

2 the rejection of the proposals that were not in3 cluded.

4 (2) CRITERIA FOR MODIFYING AND ESTABLISH5 ING SAFE HARBORS.—In modifying and establishing

6 safe harbors under paragraph (1)(B), the Secretary

7 may consider the extent to which providing a safe

8 harbor for the specified payment practice may result

9 in any of the following:

10 (A) An increase or decrease in access to

11 health care services.

12 (B) An increase or decrease in the quality

13 of health care services.

14 (C) An increase or decrease in patient free15 dom of choice among health care providers.

16 (D) An increase or decrease in competition

17 among health care providers.

18 (E) An increase or decrease in the ability

19 of health care facilities to provide services in

20 medically underserved areas or to medically un21 derserved populations.

22 (F) An increase or decrease in the cost to

23 Government health care programs.

24 (G) An increase or decrease in the poten25 tial overutilization of health care services.
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1 (H) The existence or nonexistence of any

2 potential financial benefit to a health care pro3 fessional or provider which may vary based on

4 their decisions of—

5 (i) whether to order a health care

6 item or service; or

7 (ii) whether to arrange for a referral

8 of health care items or services to a par9 ticular practitioner or provider.

10 (I) Any other factors the Secretary deems

11 appropriate in the interest of preventing fraud

12 and abuse in Government health care programs.

13 (b) INTERPRETIVE RULINGS.—

14 (1) IN GENERAL.—

15 (A) REQUEST FOR INTERPRETIVE RUL16 ING.—Any person may present, at any time, a

17 request to the Inspector General for a state18 ment of the Inspector General’s current inter19 pretation of the meaning of a specific aspect of

20 the application of sections 1128A and 1128B of

21 the Social Security Act (hereafter in this sec22 tion referred to as an ‘‘interpretive ruling’’).

23 (B) ISSUANCE AND EFFECT OF INTERPRE24 TIVE RULING.—
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1 (i) IN GENERAL.—If appropriate, the

2 Inspector General shall in consultation

3 with the Attorney General, issue an inter4 pretive ruling in response to a request de5 scribed in subparagraph (A). Interpretive

6 rulings shall not have the force of law and

7 shall be treated as an interpretive rule

8 within the meaning of section 553(b) of

9 title 5, United States Code. All interpretive

10 rulings issued pursuant to this provision

11 shall be published in the Federal Register

12 or otherwise made available for public in13 spection.

14 (ii) REASONS FOR DENIAL.—If the In15 spector General does not issue an interpre16 tive ruling in response to a request de17 scribed in subparagraph (A), the Inspector

18 General shall notify the requesting party of

19 such decision and shall identify the reasons

20 for such decision.

21 (2) CRITERIA FOR INTERPRETIVE RULINGS.—

22 (A) IN GENERAL.—In determining whether

23 to issue an interpretive ruling under paragraph

24 (1)(B), the Inspector General may consider—
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1 (i) whether and to what extent the re2 quest identifies an ambiguity within the

3 language of the statute, the existing safe

4 harbors, or previous interpretive rulings;

5 and

6 (ii) whether the subject of the re7 quested interpretive ruling can be ade8 quately addressed by interpretation of the

9 language of the statute, the existing safe

10 harbor rules, or previous interpretive rul11 ings, or whether the request would require

12 a substantive ruling not authorized under

13 this subsection.

14 (B) NO RULINGS ON FACTUAL ISSUES.—

15 The Inspector General shall not give an inter16 pretive ruling on any factual issue, including

17 the intent of the parties or the fair market

18 value of particular leased space or equipment.

19 (c) SPECIAL FRAUD ALERTS.—

20 (1) IN GENERAL.—

21 (A) REQUEST FOR SPECIAL FRAUD

22 ALERTS.—Any person may present, at any

23 time, a request to the Inspector General for a

24 notice which informs the public of practices

25 which the Inspector General considers to be
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1 suspect or of particular concern under section

2 1128B(b) of the Social Security Act (42 U.S.C.

3 1320a–7b(b)) (hereafter in this subsection re4 ferred to as a ‘‘special fraud alert’’).

5 (B) ISSUANCE AND PUBLICATION OF SPE6 CIAL FRAUD ALERTS.—Upon receipt of a re7 quest described in subparagraph (A), the In8 spector General shall investigate the subject

9 matter of the request to determine whether a

10 special fraud alert should be issued. If appro11 priate, the Inspector General shall in consulta12 tion with the Attorney General, issue a special

13 fraud alert in response to the request. All spe14 cial fraud alerts issued pursuant to this sub15 paragraph shall be published in the Federal

16 Register.

17 (2) CRITERIA FOR SPECIAL FRAUD ALERTS.—

18 In determining whether to issue a special fraud alert

19 upon a request described in paragraph (1), the In20 spector General may consider—

21 (A) whether and to what extent the prac22 tices that would be identified in the special

23 fraud alert may result in any of the con24 sequences described in subsection (a)(2); and
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1 (B) the volume and frequency of the con2 duct that would be identified in the special

3 fraud alert.